Nothing stays the same. Not even more traditional functions like HR.
Given the global transformations over the last year-and-a-half, many HR leaders are now reimagining their departments to better support the business, strengthen alignment between HR and the business, and increase HR agility and automation.
According to an American Productivity & Quality Center global survey conducted earlier this year, 85% of 208 HR leaders are restructuring their departments now or planning to do so soon.
Perhaps what’s most surprising is that more than 70% of respondents believe they have an effective HR structure already but are still restructuring, says Elissa Tucker, principal, research lead for human capital management at APQC, which tracks and identifies best practices in benchmarking, process and performance improvement, and knowledge management.
“The No. 1 driver [of restructuring] was to improve [internal] customer satisfaction across all levels,” she says. “Other drivers were the speed with which HR can service customers and the agility in leveraging the capabilities of artificial intelligence.”
Survey respondents were classified into two groups: Those in the elite group had superior outcomes, such as high employee engagement, while those in the second group didn’t. Tucker says 72% of the elite group have restructured to use centers of excellence compared to 55% in the second group. Other findings include that those in the elite group were more likely to use shared services (61% versus 35%), have highly automated HR processes (79% versus 44%), offer early-career HR development (54% versus 30%) and use predictive analytics (86% versus 49%).
As HR teams restructure, Tucker says, many leaders are also increasingly incorporating cloud solutions. Although they can’t be customized, they still offer plenty of benefits. She says that cloud solutions are generally cost-efficient, don’t require internal IT staff for implementation or upgrades, and are available for mobile devices.
See also: Boese: Why more HR tech isn’t necessarily better
No matter where HR is on its restructuring journey, Tucker points to five common areas that all HR leaders need to focus on now:
- Close HR skills gaps in analytics, cost management, HR expertise and change management.
- Devote more resources to HR change management.
- Adopt mature AI capabilities and applications.
- Leverage processes and technology to improve the accuracy of HR data.
- Use measures and analytics to prove the value of HR investments to business leaders
“But HR can get into a trap,” Tucker warns. “The best-in-class is taking into account processes, having the right structure in place and having staff develop appropriately before they even pick technology solutions. Don’t focus on technology first and have everything else follow.”