Digital Radically Disrupts HR

Anthony Abbatiello, Global Lead, Deloitte Leadership business

Digital technology is evolving at breakneck speed, changing the way businesses and governments fundamentally operate in a wide variety of ways. HR is no different. As digital enables talent management to become more democratized and more of an activity that is embedded into the fabric of everyday business, it will provide a significant opportunity to change for HR. Five major developments are poised to move this revolution forward: 

1. Data and Integration will be King

Analytics—the use of data to produce business-relevant insights that lead to action—has been heralded as the new step change for HR. Yet few HR organizations have a robust analytic capability, as collecting data can be expensive and time-consuming. In the future, companies will integrate existing warehouses of HR and talent data with Big Data obtained from social and local data sources—tweets, blog posts, RSS feeds, customer service feedback, GPS coordinates and more—to get a complete picture of their workforce’s abilities, wants and needs.

Analytics could make HR the strategic powerhouse it was meant to be—by positioning it to move from historical analysis (understanding what happened) to predictive analysis (forecasting what’s going to happen and what talent levers HR must pull to improve business performance).

2. Digital will give Power—and People Management—to the People

Technology advances are enabling HR to put the “human” back into human resources, and helping give people management back to the people. This could include involving employees and managers in high-impact talent processes—including recruiting, hiring, succession planning, learning and shaping career paths. All this will happen thanks to an emerging class of social and market-based tools that will let employees manage almost every aspect of their professional lives digitally.

In this future, the administrative burden that HR organizations currently carry may lighten up considerably. Technology will continue to enable shared responsibilities across business and HR to maximize business results.

3. Consumerization of Employee Used Applications 

Closely linked to the advent of cloud computing is the rise of businesses like LinkedIn, where talent management systems live on the web and are shared by companies. Today, employees and job candidates can input their resumes and skills on such sites. By doing so, they may circumvent the need for internal talent profile databases that aggregate individuals’ skills, job history, education, competencies and more.

Already, some organizations are drawing more on such external, public sites and integrating data from these sites into their own HR information systems. Although doing so may require some work matching data definitions used in external sites to data definitions used in internal systems, some companies are successfully blurring the line between internal and external applications.

4. Digital Technologies will Enable Customized Talent Management

Most organizations have already achieved maximum cost savings by using information technology to standardize and harmonize their people practices across their global operations. But HR professionals can now leverage that standardized framework to tailor employment practices to every worker. For example, companies can simply offer a greater variety of standard practices—such as different compensation, development or performance appraisal processes tailored to different employee segments. Or, they could let employees choose from a menu of predefined, standard options.

Just as digital changed marketing by enabling customization of products and messages, digital is similarly transforming HR. Digital can now be used to push out customized offerings, including learning and job opportunities, targeted, personalized messages, or personalized information based on an analysis of an individual’s social media digital trail and artificial intelligence that predict what an individual needs and values based on their unique employee segment. 

5. Cloud Computing will Provide further Flexibility and Agility

Increasingly, organizations are accessing shared resources, software and information over the Internet on a pay-as-you-go basis. This cloud computing approach will give HR more flexibility to support the business. With the advent of software-as-a-service, for example, companies can now update and introduce the latest innovations enabled through software every three to six months instead of every few years.

In the consumer world, people are becoming accustomed to smaller, single-use applications available for iPhones and iPads. By using similar kinds of applications in the enterprise, organizations can provide employees with the functionality they need and can avoid costly seldom-used features.

The Impact on HR

Additionally, as digital infuses nearly every aspect of talent management and work itself, it will transform how HR organizations operate and how they serve the business. We see it impacting HR in the following ways:

Agile-style HR Function

The HR function may become more focused as digital tools more efficiently enable transactional processes and as line managers and employees adopt consumer-like applications to handle HR activities themselves. HR may become more project-oriented and aimed at improving organizational effectiveness—such as helping to integrate a new acquisition. 

Core Activities of the HR Function

HR may start acting like a marketing organization, by analyzing employee, business and social data to create a 360-degree view of the employee; creating customized talent offerings; and marketing, branding and educating employees about talent and HR activities. Already, in some leading companies, HR analytics groups have been established whose mission is to analyze data to proactively predict drivers of workforce performance. 

HR Information Management and Technology Roles

As the line continues to blur between internal and external applications, the role of HR information management and technology professionals could change. As software becomes increasingly user-friendly and intuitive, HR professionals may configure packaged software instead of IT experts. Eventually, software and the manipulation of data may become so user-friendly that employees themselves may even be able to manage their own data, with only limited involvement from the IT or HR function.

For years, the human resources function has shouldered much of the responsibility for managing people, in a largely segregated operation. Technology advances will change all this, by integrating talent management into the fabric of everyday business. HR IT will further integrate with the business side of Human Resources thus becoming a vital component of organizational performance in an increasingly competitive and fast-changing world.