This recent EY report about HR transformation makes interesting reading. It highlights findings that include the estimate that HR professionals are still spending around 86% of their time tied up in administrative work.
It’s clearly not a good use of their skills, especially given that now more than ever an effective approach to people management is absolutely fundamental for the sustainable future of companies. An organisation cannot afford to have its HR professionals continually weighed down by a pile of administrative and transactional demands.
Is it time for a new approach?
The report talks about the need for a new approach. The Ulrich model had its moment but has become increasingly less relevant in a world that’s moved on in so many ways. HR needs to work horizontally across a company, rather than in silos. While centred around the employee experience, it needs to be far more driven by analytics and data.
What could a new HR operating model look like?
EY is proposing a new operating model – The People Value Chain. Within it are three pillars: digital people teams, agile people consultants and virtual global business services.
The digital people team leads the adoption of tech-driven services. It automates the majority of administrative and operational activities and enhances the employee experience while supporting people professionals to do their best work, underpinned by insightful data.
People consultants are the problem solvers and innovators, using their people capabilities to address business problems and challenges. But rather than operating according to set demarcations, the report suggests there should be flexibility, with consultants working in an agile way on a project by project basis.
Virtual global business services should then be set up as cross-functional service environments, handling operational issues that would in today’s organisations be dealt with by centres of expertise, alongside business partners to some extent.
Observations for the future
Whether organisations choose to adopt this particular model remains to be seen. But there are a number of key themes in the report that are relevant considerations for every company as they think about the future direction of their HR function.
A digital approach can be transformative
The HR models of the near future are being built on a foundation of technology.
Systems are needed to provide real-time insights that are analytical and data-driven. People data creates knowledge and perspectives that enable effective decision making and strategic planning. The data supports core HR processes and procedures and gives rapid visibility into workforce composition as well as skill and development gaps. It offers remote accessibility, opening doors to greater flexibility. Technology can be used to help HR be more flexible and adaptive, automating transactional activity and freeing them up to concentrate on the more strategic activities.
At the heart of all this is the need to incorporate tech that people are comfortable with. It must be straightforward, responsive and intuitive to use.
Adopting technology is often less complicated to do than organisations anticipate
With so much uncertainty at the moment, any kind of change can feel daunting. But as the report comments, adopting technology is often less complicated to do than many companies expect. And bear in mind that the complications that can arise longer term by not doing it could actually outweigh any upfront disruption. Think through the approach that needs to be taken beforehand, and involve key stakeholders early on, and progress is likely to be far smoother.
The pandemic has increased people’s acceptance of workplace technology
For many people, the idea of embracing technology was something that took them out of their comfort zone. Then the pandemic happened, and people found themselves very quickly and successfully adopting behaviours that this time last year would have seemed quite alien to them. People are now more willing to accept a digitalised way of doing things. There’s a real opportunity here for organisations to seize the moment.
The time to act is now
At a time when HR’s skills have never been more important, many organisations will be looking at ways to maximise their strategic contribution. Action is needed now to make sure companies are ready to face the many diverse challenges they are likely to have ahead of them.
If you would like to explore this further, why not speak to us? We have been providing companies with leading-edge HR software and payroll software for over two decades now. Get in touch today to arrange a chat with one of our team.