Eighteen months ago I started writing that the future of HRO was really about the future of HR. Axiomatically, the future of HRO, HR services, or HR technology is not driven by advances or innovations unless they are of immediate value to the HR leadership that is the consumer. What is the future of HR? And what innovations is the HR market ready to adopt? And what trends are driving the HR department’s needs?
Such is true of all innovations. Alexander Graham Bell’s odd invention sold fewer than 100 units in the first few months after the patent was granted, but by 1886 there were more than 150,000 telephones in the United States. The first television broadcast was the opening ceremony of the 1936 Olympics in Berlin, but television would not catch on for another 20 years—until the public acquired the display devices.
While providers toil at the hard business of innovation, we should turn to the challenges that the consumers, or specifically HR leaders, are facing. In this issue, we ask five Chief HR Officers to specifically address the state of the practice of HR and the future evolution of the HR profession.
As HRO Today rotates a bit on its axis to focus more heavily on the HR suite, we are finding a profession at an interesting crossroads. If you believe in chaos theory, all moments lead to all potential outcomes and create interesting crossroads. In the case of the practice of HR, what we heard was an enduring and steady optimism while navigating in the economic equivalent of a perfect storm.
All CEOs and other C-suite executives see the importance of talent, the critical nature of employee engagement, and the need for increased productivity per employee as reduction in corporate workforces has been an unpleasant fiscal necessity. HR is seen by the C-suite as the key driver in achieving these goals. In addition, new pressures in corporate governance have resulted in most Chief HR Officers representing management to the Compensation Committee of the Board. HR is more responsible, in this board coordination, to the shareholders in a new and more direct way than ever.
In the face of these growing responsibilities, HR is still seen as a general and administrative expense and under enormous pressure to reduce direct and indirect costs and headcount. The word from “on high” to HR is, “do more with less,” a grim irony as HR so often has to deliver that message to the other operating departments. How is HR handling these conflicting forces?
Better measurement leads to better deployment. One trend we heard from all CHROs was the growing sophistication of systems and metrics around both the HR effort and HR outcomes and, in some companies, rubrics do exist that demonstrate the HR impact on the P&L. Virtualization and shared services was another prevalent strategy. Whether deployed internally or with the help of an HRO partner in a multi- or single-process engagement allowing economies of scale, many of the administrative and transactional aspects of HR were being performed remotely or in shared-service centers. Most of these centers are located in countries that are considered ‘low cost” economies. Technology is also seen as the great enabler, and, it is no accident, that we do the first of a series of technology features in this month’s issue.
Are the cutbacks from the current economic turmoil permanent? What are the emerging professional areas within the practice of HR? If you were planning an HR career, what are the best career paths for someone aspiring to the CHRO role? All these questions and more are answered in the cover story. This is one of the most powerful and informative cover stories in the history of HRO Today magazine. Keep reading….