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HR’s New Challenge: Shifting from Tactics to Strategy

Today’s seismic demographic shifts are rocking HR departments around the globe. To stay ahead of the changes, HR must take on a new leadership role.

The typical human resources department is too deeply mired in day-to-day administration for strategic planning. That’s a big problem now that baby boomers are retiring and shifts in workplace demographics have made talent a hot commodity. HR urgently needs to shed its old identity as a support function and put on the C-level identity it’s been fighting so hard to earn. But how?

We gathered a panel of experts to discuss what HR needs to do now to deliver greater business value in the future.

  • Sameer Patel, Senior Vice President of Products and Go- to-Market for Cloud Collaboration Solutions, SAP
  • David Ludlow, Global Vice President of Product Marketing, SAP and SuccessFactors, an SAP company
  • Kerry Brown, Vice President, Enablement of Learning, SAP Education, and User Adoption, SAP
  • Karie Willyerd, Senior Vice President, Learning and Social Adoption, SuccessFactors
  • Arun Srinivasan, Vice President, Marketing and Strategy, Fieldglass, an SAP company

Why are HR’s traditional ways not working anymore?

Karie Willyerd: The baby boomers are retiring in droves, the incoming supply of  talent  is increasingly diverse  and  flexible, and  many  of  the available jobs in the jobless economy are temporary and contingent. It’s easy to get drawn into crisis mode and respond only to what’s most urgent, but that leaves HR with no strategic view of the future.

Sameer Patel: Traditional HR systems aren’t designed for the newest members of the workforce, who have very different ways of working, such as self-guided learning through online videos. “I want a two-minute video on how to do something really well from a colleague who’s done it for 15 years” is an approach HR doesn’t cater to yet. We need to blend traditional and informal ways of learning and sharing.

Kerry Brown: HR can’t just be the nice people down the hall taking care of payroll and benefits. They have to look at how to recruit, train, and retain talent. People have become an unbelievably large and costly asset, but when I ask companies if they know what their potential demographic shift will be in the next five years, some say yes, and many say they’re thinking about it, but many say they’re not even thinking about it yet.

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What needs to change?

Arun Srinivasan: The challenge facing HR today is how to be a business enabler instead of just a policy enforcer. You’re not there just to automate the human resources function. You’re there to manage talent more effectively and help the business be more competitive and efficient.

Willyerd: HR should have at least one workforce planning and analytics person on a staff of more than 30, but I see HR staffs of more than a thousand with no one handling planning and analytics. Someone has to be developing a plan for the future workforce that aligns with overall business strategy. You wouldn’t run a business without a vision of where you’re headed, and you shouldn’t run HR like that, either.

Brown: HR has to start being proactive about measuring and evaluating its performance to demonstrate that it adds value, just like any other business function. You need data and analytics. The more the information proves your worth, the more impact you can have.

Brown: HR has to start being proactive about measuring and evaluating its performance to demonstrate that it adds value, just like any other business function. You need data and analytics. The more the information proves your worth, the more impact you can have.

What is the most important thing HR can do to bolster its credibility as a strategic function?

Brown: HR is better known for being supportive than it is for strong business leadership. The more HR can leverage its data about talent, the more compellingly it can argue that it’s evolving from tactical to strategic and that it deserves the budget to support that evolution.

Patel: Understanding business data allows HR to talk to its line-of- business counterparts about ways to add value, which has been missing. For example, if HR sees that the company has 33% attrition in its call center, it can suggest solutions that help address the reasons people leave the job so quickly.

David Ludlow: HR has to get more comfortable with quantifying things. Say you have a manager whose turnover numbers are significantly higher than average. What does that say about the manager? You can’t know unless you have the discipline and access to data to get insight.

Srinivasan: Data allows you to understand who your workers are and how best to engage them to improve the talent pool and boost business performance.  This  goes  beyond  standardizing  processes  to  getting visibility into what’s happening in the organization. Developing a more holistic view of the employee population, both contingent and full-time, also shows you where you’re competing for talent and how your needs are changing. That puts you in a better position to create medium-term and long-term workforce strategies.

Willyerd: In an SAP/Oxford Economics survey about the future of the workforce, only 39% of companies said they use quantifiable metrics and benchmarking as part of their workforce development strategy, and only 42% said they know how to extract meaningful insights from the data available to them.1 That’s a huge opportunity for HR. There’s an old saying that applies here: if you agree with everything I say, I don’t need you at the table. HR has to bring a vision, a purpose, and a different point of view to the table to make a contribution. And to do that, it has to bring insights that are informed by evidence.

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There’s more.

TO LEARN MORE ABOUT HOW HR CAN BECOME MORE STRATEGIC, READ THE IN-DEPTH REPORT 5 BAD HABITS HR NEEDS TO BREAK IN 2015.

The SAP Center for Business Insight program supports the discovery and development of new research-based thinking to address the challenges of business and technology executives.

  1. Workforce 2020: The Looming Talent Crisis (Oxford Economics, 2014), http://www.successfactors.com/en_us/lp/workforce-2020-insights.html.

About the author:

Sameer Patel is Senior Vice President of Products and Go- to-Market for SAP’s Cloud Collaboration Solutions.

David Ludlow is Global Vice President of Product Marketing for SAP and SuccessFactors, an SAP company.

Kerry Brown is Vice President of Enablement of Learning, SAP Education, and User Adoption for SAP.

Karie Willyerd is Senior Vice President of Learning and Social Adoption for SuccessFactors.

Arun Srinivasan is Vice President of Marketing and Strategy for Fieldglass, an SAP company.

Fawn Fitter is a freelance writer specializing in business and technology.

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