• Service: Advisory, Management Consulting
  • Type: Survey report
  • Date: 9/27/2012

Our conclusion: Three simultaneous changes in HR 

The Human Resources function currently faces pressing, interconnected challenges.

The challenges for HR range from adjusting to the demands of a globalized workforce, through negotiating cost constraints, to taking advantage of new technologies. At the same time, HR’s potential strategic value is under-appreciated. In order to emerge stronger from its current struggles - stronger and better able to add value - executives must recognize and implement three concurrent changes to the HR function:

  • Who HR manages: HR needs to engage with the flexible, often virtual workforce that companies are increasingly implementing, while remaining current with a core of permanent employees. Ironically, this may involve stepping back and providing tools for line managers, or even employees themselves, to take on traditional HR functions.
  • How HR carries out its role: Web and mobile technology have already created substantial improvements in HR’s performance. Data analytics should enhance HR strategy the way the web improved administrative tasks, providing improved data to enable HR to contribute more valuable insights into the business.
  • HR’s role within the organization: The changes HR is undergoing may well lead to the function becoming more of a partner that assists others who focus on individual employees, while focusing on higher-value tasks than in the past. Ultimately, HR should make clearer to the company the value that it can provide, thereby giving it a higher profile and a more strategic role.

We believe there are a few things on the horizon that could really shake up HR and potentially make the people agenda as important to the CEO as the balance sheet and P&L statement.

But we also believe that if HR truly wants to add business value and enhance its reputation, it must push well beyond the basics and shift its focus to understand the most critical roles and levers in an organization’s value chain.

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