HR is under constant pressure to change the way it operates and strategises. There are several large and unavoidable factors that contribute to a more or less constant disruption of HR strategy and its current function - new technologies, innovations and rapid globalisation to name a few. So what are the greatest challenges HR faces? How can ODs and Directors overcome them?
As we discuss in our white paper HR in 2020, where we look at the future of HR, there are several challenges that HR strategists need to tackle. A recent study by The Economist notes that the following factors contribute to the challenges HR faces:
Age demographic of staff With people retiring later and the influx of Gen Y and Gen Z, HR needs to combat a clash of cultures as well as meet the demand for a greater work-life balance from both younger and older workers.
Globalisation Dealing with globalised operations means not only does HR have to create a common thread of culture and values across the business, but adapt this across different cultures. HR also needs to have an understanding of worldwide market impacts for the business.
Economic fluctuation HR needs to become agile in its response to market changes which now happen at a faster pace than ever thanks to both globalisation and technological advances. An insight into the company’s strategic positioning in economic situations is now an essential for HR when developing change or development initiatives.
Digital technology The implications of digital technology on workforces is both profound and long lasting – the need to upskill employees in digital skills as well as implement digital change internally are things HR will need to deal with in the coming years.
Sadly, there is no magic HR wand that can create a cultural and business fit in one go; we can only predict the best future HR strategies that Directors and ODs can implement to adapt. HR needs to become more involved in core business strategy – in reality, a company isn’t driven by profits or by technology; it’s driven by the people who create those profits and master that technology to make it a success. This is something HR has direct experience in and can bring to the boardroom – sweeping aside issues of credibility and capability to show that they are the best placed strategists to initiate business change. HR and business no longer need act like oil and water.
One HR World member noted at a recent debate that they felt the future HR function will be “much more professional, and an awful lot of transactional stuff will be outsourced to people who do it really well”. Whilst he was “hopeful” and believed that “the overall quality and capability will keep rising, people have got to be a lot more assertive and more forceful” if HR is to reach this goals. Julia Ingall explains that “We [HR] need to have the confidence to just claim our seat at the so-called top table, rather than constantly justifying it.” But it’s not just down to HR to give itself a greater voice, whilst its responsibility to create a greater volume when it comes to transformative ideas, it’s ultimately down to CEOs to listen to them.
HR has modern challenges to face, and it needs to think of itself as a vital part of overall business strategy and at the heart of transformative planning. It’s time for HR to take the reigns and lead organisations into the modern workplace environment, with a people-centric approach to truly revolutionise the relationship between HR and ‘the rest of the business’.