New technologies are changing customer and employee behaviours and eventually rewriting the rules of engagement. It is important to see how HR will transform itself in the new era.
Right from the time we get up in the morning till we enter the workplace, we may shuffle through various apps on different devices. However, the digital age is not only about technology, but about how customer and employee behaviours are changing in response to the rapidly-evolving technologies. For businesses, it is about leveraging technology to provide superior customer experience and unlocking the hidden potential of value creation. And to think only 10 years back we had mobile phones with only the ‘calling’ and ‘messaging’ features! Now artificial intelligence (AI), machine learning (ML), internet of things (IoT) and robotics are rewriting the rules of engagement—for customers and employees. On-demand economy,
personalisation and connectedness are some of its key manifestations.
Organisations are all about short-term planning, fluid structures, relentless innovation, iterative and incremental product development, shorter and frequent customer-feedback loops, and holistic and integrated usage of technology across the value chain. Organisations should be able to course correct and pivot frequently in a short duration, according to external and internal environment changes. For this, people in the organisation must develop an agile mindset and follow agile people-management practices.
Only agility can provide the required competitive advantage, for which HR will have to transform first. The same HR that was responsible for implementing rigid structures, processes and systems to ensure standardisation and efficiency, will now have to break those very systems to ensure more agility and flexibility—no doubt a huge challenge!
How can HR make its people practices more agile? By learning from the companies, which have effectively climbed up the digital curve, and are the leaders in their respective domains —the torch bearers of the agile movement! These companies are highly agile in business, organisation design and people management. They have dovetailed the following principles of agility in the way they design their people practices.
Principle-1: Working in short loops
Traditionally, most people practices work on annual or bi-annual loops. For example, goal setting in most companies happens at the start of the year, with employees getting feedback on these goals during the middle or at the end of the year. In the digital age, the goals set at the beginning of the year may no longer remain valid at mid-year or year end because of multiple unforeseen changes, which may occur during the year. Similarly, the training needs identified at the start of the year may no longer remain valid after a few months. Thus, there is a need to continuously pivot these people practices multiple times during the course of the year.
Principle-2: Relentless employee centricity
HR’s traditional love for processes and systems was justified at the time when process efficiency and standardisation were the key success metrics for HR. But in the digital age the focus is on innovation, informal collaboration and speed. Many existing HR processes and systems tend to add unnecessary inertia and inhibit the free flow of ideas and speed of decision making. HR will have to shift focus from process efficiency to employee motivation. All decision making in HR has to revolve around making employees more motivated and productive.
Traditionally, HR has been slightly apprehensive of sharing critical people decisions or decision-making methodologies with employees. For example, in many companies high-potential employees are rarely told that they possess high potential for fear of offending those who do not possess the same. This was fine in the age when employees worked in tight hierarchies and were used to receiving partial information. In the current digital age, however, employees work in flat hierarchies and understand the big picture. They are also more connected than ever before. Lack of transparency erodes trust, and trust is essential for informal collaboration and employee motivation.
Principle-4: Regular feedback & reviews
Business deliverables stand the risk of becoming obsolete if they do not fit the requirements of the external market. Similarly, HR deliverables can become obsolete if they do not fulfil the needs of the business and the employees, especially in the digital age, when things are changing so fast. Imagine a system where we create a very basic version of the HR product, test it with employees (and business leaders), incorporate their feedback, work to create the next version, test it with employees, incorporate their feedback till the point there is a perfect fit between the HR product and the employee. This will drastically improve the acceptability of the HR product. Interestingly, Google also tests its HR products first, with one per cent of the workforce, before a company-wide release. This can be done for anything and everything that we create for employees within the HR function, such as training programmes, reward philosophies, PMS, talent management, engagement framework, and so on.
Principle-5: Working in cross-functional teams
Traditionally, HR is used to working as an independent function. With the functional boundaries getting blurred in the digital age, HR will be expected to work more and more on cross-functional projects with people from diverse areas, such as marketing, sales, product management, technology, and so on. Each team will be empowered to solve a particular problem for the organisation. Some of these problems may be business related, such as creating a due diligence framework for M&As, while some may be more people related, such as designing a learning strategy for the technology function. In either case, a cross-functional team of subject matter experts is most suited to solve these issues. Gone are the days when only the HR team used to solve people problems for the organisation, and only the business team solved business problems. In the digital age, HR is business and business is HR.
Principle-6: Loosely coupled HR operating model
HR operating model is the way the HR function delivers value to its employees. Broadly speaking, there are four typologies of the HR-operating model. First is the in-house model, where all the HR-related tasks are carried out by the HR function; second is the outsourcing model, where a portion of the HR- related tasks are carried out by an external vendor; third is the employee self-service model, where a part of the HR-related tasks are carried out by the employees themselves; and fourth is the shared- service model, wherein multiple business units leverage common/shared HR services. Each of these typologies is supported by the right type of HR technology platform, and this is where the maximum scope of innovation lies. Confluence of technologies, such as social, mobile, analytics and cloud can work wonders for HR. More often than not, most of the organisations use a combination of these typologies. However, more agile HR functions are skewed towards the outsourcing model and employee self-service models which can support rapid scaling up and scaling down of HR services, as is the need in the digital age.
All of the above principles, if applied effectively and simultaneously, can make HR more agile. Agility in people practices is the fundamental pre-requisite to make an agile organisation and an agile business.
(The author is Associate Director – Human Resources at MakeMyTrip.)