The Future of HR: People, Business, Agility and Technology

The future of Human Resources will greatly depend on its ability to smoothly integrate four core elements: putting people first, aligning its operation with the business purpose and goals, becoming more agile and leveraging on technology.

Each of those four core elements are not new, but HR hasn't been too effective in each of them individually, least so in their integration.

How does this integration and the future of HR look like?

More and more people are getting engaged in the conversation about the future of HR. This conversation is inspiring an entire generation of HR practitioners and business leaders to take ownership and become active members in the construction of the future of HR. But, once again, how does that future look like?

To understand what the future might look like it is necessary to understand where we are coming from.

HR was traditionally considered a “cost center”, the “necessary evil” within the organization. HR was in charge of hiring and firing, ensuring that people were following regulations and policies and getting paid, and managing paperwork. We can summarize these functions in three of the most dreaded words that described HR role in the past: transaction, administration and control. Such was the role that HR held for too long.

Things have changed significantly ever since the advent of the first “HR” (personnel management) at the beginning of the 20th century. Today, HR is in the “eye of the hurricane”.

And at this moment, more than any other time in the past, business leaders acknowledge that HR is a critical piece of the success of any organization way beyond "transaction, administration and control".

HR is the business and the business is HR. This has been said by some, understood just by a few, and still not embraced by most.  

The same business leaders that used to tell HR not to take risks, the ones that hired the least innovative people in the world to run HR or didn’t pay attention to it or provided the necessary resources, the ones that never gave HR a “seat at the table”, those are the same ones now demanding that HR becomes more innovative and agile, that it pays more attention to employee experience (learning from customer experience), integrates technology in the operations, and, on top of that, that shows the ROI of its processes and align everything that it does with business outcomes.

Really?

HR hasn’t felt this kind of pressure before, because business leaders didn’t care about it.

Of course, most organizations today are feeling the heat of extreme and asymmetric competition from all flanks, all industries, all countries. They are feeling how the talent pool is becoming more exquisite to accept a job, how filling vacancies takes way more time than before and how turnover is higher and faster.

The bottom line: HR is important. It always was. But finally business leaders and organizations are becoming aware of this. Unfortunately, HR isn't fully ready yet to deliver the kind of value that is expected from it.

To create the best HR function that has ever existed it is fundamental to acknowledge that HR is being asked to do what was never asked before from it. But not only that, to do what HR is being asked to do it needs skills and capabilities that were never part of its portfolio.

So, the future of HR begins by understanding the current limitations and working towards building the necessary capabilities to not only become aware of the major changes and trends that are transforming the world and the workplace, but to take advantage of them in the benefit of the organization and its people.

Thus, the first part of the answer to the question “how does the future of HR look like” begins with this: in the future of HR, HR practitioners are open-minded, lifelong learners and willing to diversify the portfolio of content they learn beyond payroll and administration, entering into the world of technology, innovation and disruption.

To do this, new learning programs will be necessary, a new set of skills that emphasize content that hasn't been traditionally part of the set of competencies for HR, collaboration with people across the organization, bringing people onboard HR who know about things that aren't necessarily "HR" (like technology).

This first element can be summarized in one word: awareness and capacity building. The future of HR requires HR practitioners to be aware of what happens in the company, the industry and, in general, the world around them, and that they take action by building the capacities they need to stay relevant and adding value.

As I mentioned before, I see four core values in the future of HR.

Putting people first

Forgive my bluntness, but I don’t think HR was ever about people. You may argue against that. You may disagree with my assessment about the past of HR. But, even today, a lot of people don’t trust HR. You see it in the many articles coming out in the media about “HR isn’t your friend” or “don’t trust HR” or “beware of HR” or "where was HR when this or that happened".

HR was really never about people. It was about "transaction, administration and control". And, normally, those three actually go against the flow.

The future of HR is putting people first, for real. And to put people first a new set of skills to maximize employee experience will be fundamental. Among those skills or capabilities, emotional and social intelligence, communication, change management, negotiation, collaboration and listening will be paramount.

The second part to the question “how does the future of HR look like” includes: in the future of HR, HR practitioners are focused on delivering the best human and employee experience. Their processes are to benefit people.

Aligning HR with business outcomes

How many HR practitioners would be able to assess the ROI of their processes?

This isn’t an accusation or a way to shame anyone. If you are an HR practitioner and you don’t know to calculate the ROI of your role and, even if you do, you don't think is that significant, I don’t blame you. This was never part of your portfolio or role. But today it is. And we must integrate such analysis in the HR operation.

HR isn’t a stand-alone function, neither an island in an ocean in a planet far away from Earth. HR is part of the organization and, as such, its strategies, processes and systems must be aligned with the business. The future of HR requires that HR rows in the direction that the company is going to.

I understand that not for every single HR process will it be possible to literally calculate the ROI. But what’s important here is to consider that anything that is not aligned with the business is waste. As such, you must get rid of it. Alignment means focusing the energy into what truly delivers value for the people and the organization.

Becoming agile

One company that builds airplanes’ turbines used to take two years to build a model, test it, improve it and ship it. Today, the same company takes two weeks, because computational power together with cloud-computing and 3D printing allow them to quickly iterate and build extremely cheap turbine versions until they have the final one.

For such a company, it was OK to take six months to hire an engineer. Today, they need that engineer in three days. Are your HR processes ready to respond to such velocity? My guess is probably not. And it is OK (well, not really...). This is just the beginning. It will get faster. And HR needs to build the capacities to become more agile and respond much faster and effectively to the breathtaking pace of innovation and change in the real world.

There are two things that HR needs in this direction: build agile processes and build the capabilities to think agilely about its agile processes.

By building agile processes HR will have the possibility to respond faster to incoming demands that require shorter and shorter response times. By building the capabilities to be agile, HR will have the opportunity to revisit and change whatever processes it is running to make them more agile than it could already be.

The future of HR is agility to respond to a chaotic, fast-paced changing world.

Leveraging on technology

The last piece in the puzzle to put together the future of HR is this idea of leveraging on technology. A lot of people think of it at the first, but it is not. We can't leverage on technology to improve ineffective and pathetic HR processes. We must completely redesign those processes before thinking of a digital strategy and bringing technology onboard.

HR has always leverage on technology. But it’s done so in the wrong way. It is not enough to add a layer of technology to improve ineffective processes. Why? Because there’s a high risk of also augmenting the inefficiencies and making them, well, more inefficient.

In the 21st century, to stay ahead of the competition curve, and truly take advantage of the capabilities that technology is offering, it isn’t enough just to buy whatever shiny HR software was presented at the latest technology conference. There’s more than just that.

What HR needs is to completely redesign its processes in order to integrate them effectively available technology and deliver the full value of the process and the tech, without carrying on the inefficiencies of one or the other.

HR currently doesn’t have the capabilities to do this because it’s been focused on bringing people onboard who are mostly focused on labor relations or compensation, without a real understanding of how technology works.

The best solution for HR is to collaborate with those who know about technology and perhaps some of HR. Bring them onboard: data scientists, programmers, engineers, economists, disruptors, etc. They will help rethink the processes and use the appropriate technology, instead of just adding a tech band-aid to a messed-up process.

The future of HR

What is the answer to the question of how the future of HR looks like? It’s complex. But in the grand scheme, the future of HR requires awareness to understand the current limitations to satisfy demands from the organization and its people. In the future, HR will be focused on four core elements: putting people first, aligning processes with business outcomes, constantly seeking to become more agile, all while leveraging on existing or future technology.

Where are you in this process? 

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About the author:

Enrique is an HR and Tech Evangelist and founder of Hacking HR Forum. Enrique came to the United States from Venezuela as a Fulbright Scholar. Prior to coming to the US, Enrique was the CEO at Management Consultants, a firmed specialized in Human Resources and Corporate Social Responsibility in Venezuela. Before Management Consultants, Enrique worked in the telecommunications sector as a Senior Project Engineer for Telefonica. He currently works as an advisor for the CHRO at the Inter-American Development Bank. He is also the cofounder of Cotopaxi, an artificial intelligence based recruitment platform focused on Latin America and the Caribbean. Enrique is a guest author in several blogs about innovation, management and human resources. He has over twenty years of experience. Enrique holds an Electronic Engineering from Simon Bolivar University in Venezuela and an Executive Master’s in Public Administration from Maxwell School in Syracuse, New York. Enrique also holds a Design Thinking certification from Darden School of Business at the University of Virginia, he is certified Scrum Master and PMP.

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