As HR transitions from administrative functions to a strategic powerhouse, the role becomes crucial in shaping company culture and driving employee success. Dive into the dynamic evolution of HR leadership, discover innovative models, and explore growth priorities that redefine how organizations engage with their talent.
We start by asking a simple question. What is the purpose of HR? Why does it exist in an organisation?
According to the Cambridge Dictionary HR is:
“the department in a company that is responsible for dealing with employees, for example, by employing them, training them, dealing with their problems, and managing their records”
Based on this definition, HR could be viewed as operating at arm's length as a mainly administrative or disciplinary role, when in reality, HR is at its most effective when fully integrated, with its leaders advocating for people-first strategies at the highest levels.
A recent survey of 550 HR leaders found the top HR priorities are:
We propose a definition that encapsulates the importance of people in an organisation:
To source the people to meet the needs of the organisation, help them perform at their best, and ensure the processes are in place to support and manage them effectively.
Google's motto for People Operations
From the early days of the Personnel Department to its current incarnation as Human Resources, Human Capital, People Operations, Employee Success or even People@, the HR function continues to change and evolve.
In 2015, Airbnb made headlines when its Chief Human Resources Officer (CHRO), Mark Levy, was relaunched as the Chief Employee Experience Officer (CEXO), signalling a more holistic approach to people management.
At the heart of an Employee Experience role is an ability to build relationships, bring people onside and act with empathy. It was summed up by one contributor as the role that“makes work suck less” and by another as the internal-facing Customer Experience Officer (CXO). The EX professional must understand processes, blockers, and engagement tools, excel in internal comms, and be dedicated to providing an inclusive environment that promotes employee wellbeing.
Since then, there have been a raft of new approaches and titles for what is now seen as the more traditional policy and procedure-focused role of CHRO. LinkedIn reported that the Chief People Officer (CPO) was one of the fastest-growing roles of 2023. Meanwhile, it has become more common for a pure EX role to report to the CPO or CHRO equivalent as an extension of the HR function.
Research by Met Akan and Nick Bloom outlines this shift to more senior titles for HR leaders in recent years, with CPO and CHRO leading the charge.
Most HR leaders think that excelling in employee experience is the innovation that will have the most impact on their organisation, ahead of AI and empowering the front line.
Steve Wynn
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In 2022, McKinsey outlined a new approach to the traditional HR operating model. It outlined alternatives to the Ulrich approach, which had held sway for over two decades. The model featured skilled HR business partners, centres of excellence and shared service centres that supported what was then a more transactional support-based function.
The major shifts included adopting agile principles to respond to change, excelling in employee experience to attract, motivate and retain talent, empowering the frontline to make decisions, individualising HR services to meet employee needs, ensuring data excellence to facilitate machine learning and automation, and ensuring accountability across cross-functional teams.
Of course, it’s a tall ask to meet all of these ambitions at once, so it’s up to the leader to decide how best to prioritise and adapt these themes to meet the needs of their particular organisations.
Some organisations choose to reduce the managerial role of HR and instead empower line managers to take more responsibility. Others hero technology and implement automation and AI to operate a leaner function. This restructuring of work then allows the team to adopt a new focus depending on the organisation's needs. This new direction may include honing in on key EX moments or taking a leading role in shaping the organisation's values, purpose and culture. Others may focus on excellence in L&D, upskilling and reskilling the existing workforce and instilling a growth culture.
Whatever the tactics, the goal must be to engage employees. Using competition to drive performance is no longer enough. It has been shown to discourage those who can’t see a way to win and can encourage unproductive working behaviours such as withholding information or help from fellow competitors. Instead, leaders must work to instill purpose and value throughout the workforce, whether that is through individual growth plans or company-wide initiatives.
Brené Brown
Author and researcher, University of Houston
Defining and effectively communicating the vision, mission, purpose and values of an organisation has the potential to transform metrics across the talent lifecycle and positions HR leaders at the heart of a business. Our guide provides a step-by-step approach to cementing your employer brand and employee value proposition.
The implementation of HR software has greatly expanded the data available to teams, giving access to a suite of workforce analytics that can inform decisions around employee engagement, satisfaction, performance and productivity. This data is helping predict future requirements, optimise revenue and reduce costs across the organisation, and there is still room to improve. Talent Intelligence offers the opportunity to go beyond internal workforce insights and towards a holistic approach, incorporating industry-level trends and data, and research into competitor organisations.
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Supporting employees to perform at their best is key to an engaged, productive workforce. In recent years, this has resulted in a focus on mental health and providing associated benefits such as counselling services and mindfulness training. More recently, the increasing awareness of neurodiverse conditions and how those with different needs can be best supported offers a new dimension. HR teams continue to face the challenge of providing their people with a combination of resources and benefits that support their personal journey whilst avoiding being seen as overly intrusive in employee's personal lives.
Skills-based hiring offers an increasingly popular approach to recruitment, prioritising skills profiles over a reliance on institutions and certifications during the hiring process. The change in approach means there is likely to be a gap in internal skills mapping, with existing employees undergoing a different recruitment process. This provides HR leaders with an opportunity to develop an internal talent skills map, giving greater transparency of the available skillset, allowing leaders to map employee skills to projects, plan talent paths and provide employees with opportunities for growth.
While there are many scare stories about how AI will impact the workforce, many see it as a way to add value and scale efficiently rather than scaling back existing teams. New technology has the potential to quickly analyse data, reduce bias in recruitment, automate repetitive processes, and facilitate digital training and onboarding programmes that may otherwise require travel and in-person resource. While much of this technology already exists, the future is in moving from implementation to integrated systems that remove friction, accelerate productivity and improve the employee experience - of both the end user and those in control of these systems.
The fast pace of change puts organisations at risk of leaving less tech-savvy employees behind, as well as overlooking those with the capacity to do more. Upskilling existing employees to embrace new technology helps organisations reap the benefits of new software and can open new career pathways. More broadly, a programme to nurture internal talent improves engagement and furthers retention, resulting in a more committed and productive workforce.
The acceleration of remote and hybrid working has changed the way we work and the way we are managed and manage others in turn. The need for rapid change during the pandemic led to many people managers adapting in real time out of necessity. Now, with many organisations adapting to permanent hybrid and remote working policies, HR is well placed to ensure that there are tools and processes in place to support effective line management for a dispersed workforce, alongside encouraging best practices, facilitating better collaboration and coaching leaders to embrace tough conversations.
Whatever title is chosen for the role of an organisation's people leader, some essential elements move HR leaders from a support function to a leading voice in shaping the business's future.
Ensures that decisions that impact the acquisition, engagement and retention of talent can be informed and challenged where necessary.
Employees are looking for more than just a job; they want an organisation that shares their values and gives them a strong sense of purpose. What may have once been a footnote is now a cornerstone of a strong talent strategy.
Providing employees with multiple opportunities to engage, from surveys and town halls to informal discussions.
Measuring the acquisition pipeline from awareness to applications to qualified candidates and monitoring engagement metrics such as absenteeism, retention, productivity and performance.
Valuing long-term impact on the organisation over short-term seat filling.
Optimising how people perform and develop through personalising L&D programmes, working with employees to set goals and develop their career plans.
They can inspire and showcase what is possible, bring people along, and shift mindsets from the executive team to the frontline.
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© Talent Insight Group 2024
