Rethinking Human Resources in a Changing World 

In the last 5 years, organizations have been preoccupied with cost optimization, cost reduction, sustainable cost management ... all things 'cost'. This has required HR to play its part, largely through making the HR function more efficient, but not necessarily more effective.


KPMG International commissioned a study of 418 executives across the globe to probe more deeply into the challenges the HR function is facing and to gain a deeper understanding of the opportunities that lie ahead. The study sought to gain new insights into how the HR function can transform itself in order to deliver its long-awaited promise of becoming a strategic partner to the business.


Key findings

Rethinking Human Resources in a Changing World is a report from this study and provides a fresh view of the path ahead for leaders of the HR function. The study's main findings include:


  • HR is struggling with the challenges of managing a global, flexible workforce. The global workforce has become increasingly integrated across borders while simultaneously growing more virtual and flexible. These developments have made the retention of key talent and building workforces in new markets the top priorities of HR departments over the last 3 years. Survey respondents expect little change in the next 3 years. Yet only about one in four respondents say that HR at their company excels at core issues such as sourcing and retaining key talent globally; supporting a virtual and flexible workforce; and supporting the greater globalization of the business.
  • Finding ways to engage with workers will help address the challenges of this global, flexible and remote workforce. Insights from interviewees for this report point toward improved employee engagement as the way to address many of these problems. This will involve creative solutions, such as the development of HR policies and approaches that have global application but can be made relevant to local conditions. It will also require new ways to engage meaningfully with a workforce that is less committed to the organization.
  • Technology has transformed HR and the application of data analytics will foster even more profound change. Sixty-nine percent of companies surveyed say it is more common for the HR function to provide web-based and/or mobile HR platforms (e.g. benefits, payroll) than it was 3 years ago; only 3 percent of respondents have cut back on these technology enhancements. These have already enabled HR to do its basic, administrative work faster and more efficiently. They have also provided employees with more flexible and tailored training opportunities while creating a positive culture for communication.

    The advent of data analytics - the most commonly cited area by respondents for IT investment in the next 3 years - will lead to the next technological quantum leap for HR. Interviewees explain that the application of analytics, if done properly, will enable a more robust understanding of employee-related needs and opportunities. For example, already 57 percent of respondents say that data analytics is helping to identify future talent gaps.
  • Technology and economy are twin catalysts for HR transformation. Powerful technologies, emerging in times of heightened financial constraints, present a rare opportunity for HR to enact long-overdue reinvention. Looking ahead, HR needs to:
    • develop greater confidence, leadership and credibility, so that HR heads can deservedly insist on a place in strategic conversations at the highest levels
    • develop closer partnerships within the company, especially with line managers who will inevitably use technology-driven HR services to play a greater role in employee management
    • recast its strategy so that it begins from a whole-business perspective and is aligned with the needs of the entire company, not just the HR function.


For more information, download the full report below.


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Rethinking Human Resources in a Changing World (PDF / 534 KB)