it’s time for a revolution
This is not your mom’s HR
Several years ago, the head of Human Resources at the organization where I was working asked me to consider working in HR. I had about ten years of business and IT experience at the time and thought she was downright crazy. But, she wouldn’t let it go. She countered every objection I raised and finally said, “We need to transform HR with people who have broad experience and are business-focused.” So, I transferred and thought I would spend two years working in HR and then move on to something else. But, once I started to get into it, I realized that my impression of HR as a compliance-based function was totally wrong. There was so much more to it, and I saw a real opportunity to impact the organization.
Fast forward to today. Executive leaders are starting to understand the importance of HR and want to make these functions more strategic to the organization. Unfortunately, most organizations are still adhering to HR practices that were designed during the industrial economy; don’t they realize it’s time for a reboot? To achieve this, we need HR teams consisting of all types of unique backgrounds to bring diversity of thought and innovation to the human capital space. I strongly believe we will require different perspectives from traditional (finance, operations, HR, strategy, etc.) and non-traditional (data scientists, artists, behavioral scientists, psychologists, etc.) backgrounds to design fresh approaches which are relevant to the post-industrial economy. As HR evolves to meet these challenges, I expect the function to be elevated and the HR leader to be a key advisor to the CEO and leadership team. Not convinced? Let me highlight a growing number of trends that I think require new, innovative thinking in the human capital area to change your mind.
On the catwalk
You’ve heard me say it before—never has human capital been so critical to the success of an organization as it is now. I am sure you’ve heard about the war on talent or the growing skills gap. In the U.S. alone, it is estimated that the economy will face a shortage of five million workers by the year 2020 (U.S. News & World Report). Bottom line: we simply do not have enough skilled workers and this is not going to change in the foreseeable future. In addition to a growing skills gap, artificial intelligence is becoming much more sophisticated and is predicted to begin replacing segments of the white-collar workforce.
Given these trends, HR needs to design and develop new work models that leverage skills in innovative ways to get work done. This may mean moving to more “contract” type work models where individuals contribute specialized skills to a number of organizations at once or changing the management structure like Zappos did with holacracy. However these models evolve, it will require us to re-design how we acquire, develop, and retain talent. Once we define how work is completed, we will have to determine a process to identify what new skillsets we need over the course of 3-5 years to ensure an organization’s sustainability. There are no easy answers to this and it will require a variety of perspectives to determine what works. Regardless of how this plays out, this is one trend that will require different perspectives and backgrounds working together to solve.
Protect the environment
In addition to requiring new work models, we also need to create new work environments to spur innovation and drive engagement. The statistics are scary: only 32% of US workers were engaged in their jobs in 2015. And it is not difficult to understand why: in so many ways, we have become our own worst enemy. Many of us are so consumed by the busyness of our work life that we have no time to be creative or innovative. In a 24/7 knowledge economy, a traditional 9 to 5 work job has morphed into an “always on” work environment. Instead of being strategic about how we work, we tend to work nonstop. Unfortunately, this doesn’t translate to more productivity or innovation. Instead, it seems to lead to a disengaged workforce, where we continue to sacrifice more and more of our personal lives for our work. To survive, HR cannot simply rely on the industrial economy practice that requires employees to come into the office and contribute a certain number of hours Monday through Friday.
It is time to create the right working environment for the new normal. How do we balance the “always on” work environment? We need to truly embrace inclusiveness and have work environments that seamlessly accommodate all types of employees and their whole selves. This means parents, or caretakers, and/or people who want to pursue their whole life, not just a work life. Companies like Netflix, Virgin, and LinkedIn are starting to embrace this through unlimited vacation policies to empower employees and place more focus on results. CultureRx has developed a Results-Oriented Work Environment (ROWE) that is gaining momentum. While these are all great, I believe we need to continue developing different approaches and the right change management to evolve the work environment to align with the post-industrial economy. This will help drive engagement levels that will ultimately have a positive impact on productivity. And, it will also enable employees to be present in every aspect of their lives – work and personal. Again, there may not be a one size fits all approach, but a HR team with a diverse set of skills has a unique opportunity to design and develop new creative models that will lead to a more engaged workforce and a sustainable organization.
Reap the rewards
In addition to new work models and environments, we also need to re-think how we reward employees. So many reward systems have unintended consequences that discourage employees from taking risks and encourage actively disengaged employees to continue showing up to work because they are “in reach” of an incentive based on tenure.
The research is there: there is a mismatch in the way business rewards employees and the science behind motivation (Daniel Pink, “Drive”). As we evolve into the future, it may be time to get away from long-term reward systems based on vesting or tenure. I think organizations need to move from the concept of wanting employees to stay for life. HR needs to help organizations evolve their thinking to encourage an employee to stay as long as they are happy and engaged—and not for a second longer. Disengaged employees are a cancer to an organization as they breed mediocrity. How do we re-design our incentive programs to align with what motivates employees? I don’t have an answer yet, but I think this is such a significant opportunity for HR to drive. In this particular instance, I believe each organization will have its own plan for what works and that the HR function will need to be very thoughtful in its approach to ensure the incentive program rewards top talent while still being attractive to the external talent market.
Bringing it all together
There are some compelling human capital challenges facing organizations today and we need different perspectives from all fields coming together to help solve them. I think it is time for us to strongly encourage people who have successful careers in other fields and high quality entry-level talent to join the HR revolution.
What do you think? Do you believe a diverse HR team is the way to get ahead of these trends? Has your organizations started to address these trends in creative ways? Are there other trends that we should be on the thinking about?