Disruption in HR: Reinvention or Irrelevance?

One of my favourite high-tech entrepreneurs, Peter Diamandis, said in one of his recent Exponential Wisdom podcasts with Dan Sullivan that "you should never let a good crisis go to waste". It's true that if we look back on history, it has been during most crucial times, times where humanity's mettle is tested, that great things can happen. The periods after the Great Depression in the 20s-30s, the Cold War in during the 50s and 60s, or the dot-com bubble 20 years ago all accelerated innovation and disruption, and positioned key companies that challenged the status quo in those periods to dominate subsequently for years if not decades.

Looking at the pandemic we see both the big tech giants as well as a myriad of start-ups shaking and disrupting entire industries in a matter of months. The pace of innovation is accelerating, allowing for collaboration, funding and execution of ideas to happen in record time.

Human Resources has been no exception to this trend of disruption and innovation. Some are even arguing that HR is not needed anymore. BBC News aired a story back in February this year (https://www.bbc.com/news/business-56130187) about Octopus Energy, a green energy UK start-up valued at more than GBP 1.4b, which "has no HR function". The article quotes Greg Jackson, Octopus' CEO as saying that "there's a tendency for large companies to infantilise their employees and drown creative people in process and bureaucracy". and that "HR departments don't make employees happier or more productive in his experience".

While I believe that position is extreme, I do think that changes in both technology as well as business models are accelerating the pace at which HR is becoming disrupted. Increasingly, employees are more and more empowered, automating a greater number of activities historically done by HR. Here are a few examples:

• Machine Learning-powered algorithms include candidate screening, through tools that use natural language processing code on pdf files to screen CVs based on a given set of qualifications This is great for companies that get literally thousands of CVs for one or two positions. The initial screening process can be fairly automated, with humans concentrating only on a "premium" set of preselected CVs.
• Candidate interview video analysis tools powered by AI that allow both facial expressions as well as tone of voice to be analyzed and detect personality traits, and whether these are compatible with or enhancing of a given job's performance, are also becoming increasingly more available.
• Deeply personalized learning and development content through micro-learning and other tools given the needs of your job, building in recall exercises to ensure learning is reinforced.
• Employee engagement and preference analysis is another area where technology is allowing first a lot more real-time feedback from employees, which has become a must in such a volatile pandemic environment we are living through now. There are tools in the market that allow preference analysis on different elements of a company's value proposition for employees. These used to be static (not changing much in time), but in a pandemic world full of volatility, keeping close track of employee preferences is a must.
• Real-time (or at least frequent) performance conversations, which is becoming increasingly more of a trend now, is also further enabled through new technology
• Predictive analytics based on machine learning tools that correlate dozens of different factors and estimate, for instance, an employee's probability of quitting within the next 6 months are also becoming more prevalent. Predictive attrition models allow HR to act preemptively and avoid the loss of high performing talent.

Let us now couple these advances in HR tech with two other or trends: HR self management and the role of line managers and/or team leaders. HR tools are allowing employees themselves to take a lot of matters into their own hands, without a need for the "traditional HR", or certainly not as much as before. Couple that with having access to an unprecedented amount of learning content online for free, and what you get is an increasingly more capable workforce that can find a lot of answers on their own.

Line managers, on the other hand, are also becoming more mature. Concepts of teaming, coaching, mentoring and people development are becoming increasingly more deeply ingrained into what they are supposed to do. These are the kind of line managers that Greg Jackson from Octopus Energy refers to in the article above. It's a fallacy to think that part of HR's role is to develop employees. That is first and foremost the accountability of line managers. It is true that many have not necessarily been taught how to do that, and that's one area where HR can come in, as an enabler.

When you couple advances in HR tech with HR self management and increased accountability of line managers, where does that leave HR as a function? HR can no longer afford to play the role it has played in the past. Even HR Business Partner models which have been around for 10-20 years now, have to evolve. Conventional HR, as one might call it, has its days numbered. HR has to evolve its role to a much higher value-add, or otherwise it will find itself obsolete within the next 10 years.

So, what should HR do? HR has to be able to deal with and live within much more dynamic environments, applying agile methodologies and ways of thinking, which are more suited for a fast-changing environment where business requirements for talent might change from one week to the next. Along these lines HR needs to be able to deal effectively with an increasingly more contingent workforce, finding the right talent needed at any point in time really quickly, and onboarding / off-boarding (temporary) employees rapidly. HR needs to become an "information broker" that can contribute to curating learning content and make it relevant to the needs of employees and the organization as a whole, allowing the them to survive in the middle of this digital deluge. HR should enable the development of employees with capabilities across an increasingly wider set of cross-functional areas, aiming to develop those "digital polymaths" that can harness the power of technology to the full, rather than continuing to build functional specialists. HR professionals also need to hone deeper behavioral skills to understand a changing workforce, its motivation and its purpose. And last but not least, be able to use the predictive analytics tools mentioned above to maximize quality of hire, onboard and off-board employees quickly and effectively, and minimize attrition of top-performing staff.

Disruption is here to stay. Advances in AI may be changing the future of work and the future of HR. HR professionals need to acknowledge this and embrace change and disruption as something inherent to their jobs. They will then evolve and not only survive, but thrive through this disruption.