HR's survival depends largely on embracing Digital HR (Facts and Figures in the Nigerian Landscape)

There is a general notion that HR Professionals are slow adopters towards the use of digital tools. Though I can't ascertain the accuracy of this notion, it is an obvious fact that HR is in most cases the last department in most organisations to embrace digital tools to improve its processes.

In order to address this globally, Digital HR as a distinct function in the HR department was established and HR professionals who understood the importance and use of these tools became sought after. However, this isn't fully the case in Nigeria (We would look at this extensively from a survey conducted below).

Lets look at Digital HR in detail.

What is Digital HR?

Digital HR is the digital transformation of HR services and processes through the use of social, mobile, analytics and cloud (SMAC) technologies. The sole application of new technologies is not what makes HR digital, however as Jeff Mike, from Bersin by Deloitte puts it: “Digital HR should also align culture, talent, structure, and processes to balance efficiency and innovation, as well as to sustain a measurable impact on the greater organization as it continuously transforms.”

In the past some Organisations have tried adopting the use of SMAC tools but dropped it along the line for different reasons unique to them. The major factor behind this in most cases is because we are fascinated by the use of these latest technology, instead of stepping back to address whats wrong in our processes and fix them before implementing any technology tool. Adding technology to a faulty process only enhances the faults instead of maximizing it. Enrique Rubio succinctly expressed this in one of his articles by stating that “HR digital transformation doesn't start with technology. It ends with it.”

How are we embracing Digital HR in Nigeria (The Digital HR Survey)?

At the beginning of January 2019, I embarked on a journey to answer a personal question: How well are we adopting Digital HR and its tools in Nigeria. There are a lot of preconceptions out there, as well as very few articles and studies addressing this, but none answered my questions as someone who is very passionate about Digital HR. Since then, I have spent about 38 hours in my free time over the weekend to interpret the data used & compose this article and 336 hours to gather the data used through a survey sent to several HR Professionals at different levels.

Disclaimer: It should be stated that the views expressed in this article are solely that of the author, Joshua Ayo Omomia, in his private capacity and do not in any way represent the views of the company he works with or any other entity in Nigeria.

Sample Size

At the beginning of the year I reached out to experienced HR professionals to participate in the Digital HR survey. My final sample size for this report is 46 participants from different companies representing a range of major industries.

1) Sample Size by Level

In the sample size, majority of our respondents fell under the Operational level.

2) Sample Size by Job title

Based on Job titles, HR Officers had the most representation, making 13% of the participants, this was followed by HRBP's with 8.7%. There were some interesting Job titles such as HR Digital learning leader and HR Product Manager.

3) Sample Size by Industry

In grouping the Organisations surveyed into Industries, I used the NSE industry classification standard. This brought it to 12 industry sectors. This survey further reinforced the fact that the Nigerian Economy is majorly service driven. 37% of our respondents were from the Services sector, this was followed by the Consumer goods sector with 17% then the Oil and Gas sector with 15%. No respondent identified to be from either the Agriculture, Natural Resources or Conglomerates Sectors. This could only mean that either my Survey pool wasn't far reaching or we don't have enough structured companies in these sectors.

4) Majority of the respondents that participated in the survey currently work with Multinationals

5) Most of the respondents attest to the fact that the Company they work with use applications to make their processes easier and more efficient.

For the purpose of this research, Microsoft tools such as Excel, Word, PowerPoint etc were excluded. Business Intelligence tools such as Microsoft Power BI were however accepted.

6) Most respondents use these tools for Core HR functions, less use it for Strategic HR Functions

For this survey, I grouped the technological tools into Core HR, Workforce Management and Strategic HR. Core HR applications are responsible for managing employee benefits, employee’s sensitive data, Payroll management etc.Workforce Management applications are responsible for tracking each employee’s attendance, track each employee’s sick or paid time off day accruals and usages etc. Strategic HR applications are responsible for recruiting and tracking talent acquisition data, learning and development management , performance review, assessing skills gaps and predicting turnover.

7) Organisations in the Services sector invested the most in tools that track its employee’s attendance, sick or paid time off day accruals and usages.

While Organisations in the Utilities and Industrial Goods sector solely tracked their workforce management, this is understandable since work in these sectors are labor intensive. Furthermore, the only sector that had an equal spend on all categories of tools was the Healthcare Sector. The Oil & Gas sector and Information & Communication Sector closely followed. In addition to this, most sectors do not fully embrace Strategic HR tools, the only Sector which had this as the second most used tool was the Financial Services Sector.

8) Cost is the major impediment to fully embracing Digital HR

Excluding the Not Applicable option, Cost came out tops as the major reason hindering firms from going digital. This was followed by a need for more explanation on these tools and software.

9) At the C-Suite Level, HR Professionals are solely concerned about the numbers, at the Operational level, cost and a need for more explanation on the tools and software are a major concern.

At the Executive level it is understandable that the cost to the business is a major concern for them considering the fact that they speak numbers at Board and Executive meetings. Senior Level HR Professionals also complain of Cost and a need for more explanation on these tools. Middle Level Professionals were the only ones who complained about a lack of Vendors for these tools. Operational Level Professionals complained about Cost and a need for more explanation, this is understandable considering the fact that other levels expect them to have a grasp of these tools and explain it to them.

10) On a Sector basis, the Oil and Gas sector isn't bothered with cost but rather a need for more explanation on these tools and software, in comparison cost is a major factor in the Services sector

In the Healthcare industry, the major hindrance is the fact that these tools are not considered relevant. The ICT sector is the only sector that complained about a lack of Vendors/Providers.

11) In terms of participants that signified they don't use these tools, the Services sector has the most potential for Vendors and Providers to tap into.

12) Most Organisations surveyed subscribe to applications owned by external Vendors/Providers while a few own customized applications built solely for them.

13) All respondents consider People Analytics Important

14) Majority of the Respondents use graphical images and videos to facilitate and explain HR Processes, Policies and Procedures

15) 87% consider it necessary to use Social Media to facilitate HR Processes

16) 24% of the respondents feel threatened by Automation and the Future of Work

Conclusion

While there are many takeaways from the study and the charts above, these were the strongest signals to me:

1- Cost is a major impediment to fully embracing Digital HR. The reason for this might not be too far fetched, most of the Vendors/Providers who develop these HR tools are mostly based outside Nigeria thereby causing their pricing to be at the dollar equivalent.

2- Other sectors excluding Oil & Gas and the Utilities Sector are heavily influenced by the Price of these tools.

3- We recognize the importance of Social, Mobile, Analytics and Cloud (SMAC) technologies but we are not fully embracing it. Apart from Cost as a major factor, a lot of HR Professionals want to be properly educated on the importance of these tools.

4- HR professionals at the Operational, Middle and Senior level are the agents that can push reforms. HR Professionals at the C-Suite Level would listen to their reporting lines so far the financial implication can be accommodated by the budget.

5- The Lack of Vendors/Providers isn't an impediment to the Digital HR transformation in Nigeria.

6- The market for Core HR and Workforce management tools is almost saturated. The category of tools with the greatest potential are Strategic HR tools.

This article is the first piece of a longer-term project I am pursuing to better understand the Global Digital HR Landscape. Please follow me on these platforms, medium, on LinkedIn, and Twitter to be notified of future projects.

Feel free to use the figures by referencing this article.

If this study was useful to you, please share it with your colleagues and friends. Write in the comments below what other observations you want addressed. I will tweet new charts here.

I would have to appreciate all the respondents from my Linkedin network and HR groups such as the HR Zone and The Village, thank you all for participating.

Ayo.