There are seven key disruptors to managing talent in the global business environment, according to Deloitte's Future of Work research. Many of them are based on technology and they all present challenges for HR, say Gary Notley, a director with Deloitte's Human Capital team.
The first disruptor relates to the pervasiveness of technology. "Technology is everywhere now," he says. "There are 2.6 billion smartphones in the world, for example."
The second disruptor is the massive growth of AI, robotics and cognitive computing. A robot that cost $500,000 in 2008 would cost $22,000 today.
Third is the vulnerability of jobs and tasks to automation. "It is believed that 35 per cent of jobs in the UK, 47 per cent in the US, and 77 per cent in China will be automated in the future."
Fourth is the tsunami of data we are experiencing. The amount of data out there now is nine times greater than just two years' ago, he remarks.
The fifth disruptor is diversity, demographic and generational change. "While millennials represent 50 per cent of the workforce now we are also witnessing a longevity dividend where people are enjoying 50-year careers and working long after traditional retirement."
The sixth disruptor is a fundamental change in the nature of careers. "The half-life of skills is now down to two-and-a-half to five years, it used to be 20 years. The average tenure in a job is now four-and-a-half years. People are having multiple careers within one career journey and doing more experiential work."
Finally, the seventh is the explosion in contingent work. "In the US, 60 per cent of employers plan to hire more freelancers than full-time employees by 2020. We are not seeing this so much in Ireland, but it will come. It just hasn't happened yet."
But what does that mean for HR? “HR has been going through constant evolution in recent years,” says Notley. “It focused on personnel management back in the 1980s and 1990s. It was very much hire, fire, and make sure employees got paid. In the 2000s it became more of a serve and support role while still carrying out transactional processes for the business.”
In future, organisations will have to treat their workforce like their customers and HR will have to operate that way
There was often no seat at the leadership table for the HR function back then. That is set to change, however. “Now, with the disruptions taking place, HR will move to become a strategic adviser to a business. It will be key in delivery of digital strategies for business. Digital is not just technology, it’s the mindset that goes with it. A bigger appetite for risk will be required, for example. HR can play a massive role in that changed mindset. It is a question of what the business strategy is and how HR enables it.”
Part of that will be in how it engages with employees. “In future, organisations will have to treat their workforce like their customers and HR will have to operate that way. HR will have to look at those customers and ask what they offer them and how they offer it. There will have to be a more experiential focus. What are the moments that matter to employees? Is it when they get paid? When they achieve something in their jobs? When they interact with colleagues? This has to be understood. Today’s employees have the same expectations as modern consumers. The live in a 24/7 world and when they want something, they want it now, they want it perfect, and they want it free. HR has to deliver this.”
HR also needs to become digital. “HR has to deliver new ways of working”, he adds. “In future, rather than fixed roles people will perform different activities in a more fluid team environment. HR can role model and promote experiments with new technology. They can test new technologies like workplace collaboration tools in a controlled environment and in ways that do not entail huge costs for the organisation.”
Utilising data
But it does have some catching up to do when it comes to data. “HR is not utilising all the data available to it and the data that is available is poorly managed and maintained. They can do more with it by making it accessible internally without breaching privacy rights. But no one can jump into being a predictive analytics expert straight away. It’s a question of taking small steps to get to the stage where they will be able to move to more predictive insights. That will enable HR to become a strategic adviser. They could use the insights to predict oncoming workforce problems and make timely interventions to prevent them happening.”
Transactional activities will never be fully optimised, however. “You are never going to completely lose that piece,” says Notley. “Regardless of how much you automate, there will always be some human intervention to make decisions in the employee lifecycle. Automation presents opportunities for HR to optimise as it moves into a more strategic space. You are never going to lose the transactional piece. It’s really about doing that with a customer focus and identifying the moments that matter.”
“HR needs to do this if it is to maintain or regain a seat at the leadership table. And HR needs to be at the table if organisations are to win the war for talent and retain existing talent by increasing employee engagement and satisfaction.”