A sense of purpose, transparent feedback, and a meaningful employee experience are all key pieces to becoming an employer of choice in today’s competitive market.
By Russ Banham
Like every executive function in the corporate realm, HR is under extreme duress as the business environment becomes more global, complex, and technologically driven. Change is constant, as the march of transformation generated by social, mobile, data analytics, artificial intelligence, the cloud, and other technologies moves forward at a rapid pace.
Technology is rapidly altering the business model of all organizations: changing how employees communicate and collaborate, how workforces are structured, and how human capital is managed. In the new digital ecosystems that companies are building, HR is still responsible for identifying job roles that are critical to their organization’s success. But, as the nature of these roles evolve and workforce dynamics change, HR professionals are being called upon to think outside the box, particularly as the availability of talent becomes increasingly scarce.
Given these needs, it is not surprising that the management of human capital remains the front-burner concern for HR as 2016 takes shape. “I hate to say it again, but the war for talent is still the biggest issue confronting HR,” says Eileen Benwitt, chief talent officer at Horizon Media, a media services agency with more than 1,000 employees. “We still don’t know all the reasons why people join, stay or leave an organization, much less the skills we think we need to win in the marketplace. We’re all working hard to acquire this knowledge and are leveraging technology to do it.”
The most pressing issues confronting HR remain the acquisition, retention, and effective use of talent, particularly as this relates to an organization’s culture, employment brand and employee engagement. “The biggest issue for HR leaders is to get laser focused on ‘the employee experience’ and redefining their role as ‘the chief employee experience officer,’” says Josh Bersin, principal and founder of Bersin by Deloitte.
Talent is Top Priority
Several HR leaders and human capital management (HCM) consultants weighed in with much of the same commentary, concurring that strategic talent management is the top concern for HR today. “Having the right talent in the right place at the right time is considered a major competitive differentiator, and much of this burden is falling on HR,” agrees Michael M. Moon, Ph.D., director of research in human capital management at Aberdeen Group.
Kyle Lagunas, a principal in the analytics practice Lighthouse Research and Advisory, states that HR is “trying to find new ways to attract better talent, hiring content marketers to drive social media campaigns, and investing in CRM (candidate relationship management) systems to identify and nurture leads. A lot of what is going on looks like marketing, which tells you how important HCM (human capital management) has become.”
Attracting the best talent has certainly become top of mind for Candace Osunsade, senior vice president and chief of staff at Baltimore National Aquarium. “We’re increasing our visibility as an employer, by fully building out our presence on LinkedIn and Glassdoor, in addition to increasing the emphasis on our own website that this is a great place to work,” she says. “We’ve also taken strides to improve the application and interview experience by treating our applicants as customers and emphasizing their future potential, if not as employees, then as volunteers, donors, guests, and general brand ambassadors.”
Much of this hard work appears to be paying off, says Bersin, whose firm’s research indicates that in 2015, for the first time in many years, “HR is starting to make significant progress in strategic talent issues and the adoption of a new breed of technology. HR is very heavily investing in technology and reskilling itself.”
Aberdeen Group’s research paper Human Capital Trends in the Age of Transparency reports similar findings. The survey of HR executives in nearly 250 diverse business sectors indicates that the top pressure driving HR strategy in the 2016 is the critical need to have talent in place to execute organizational strategies. “This was the same top concern the previous year and likely to be that for some time,” Moon says.
One reason for the apprehension is the scarcity of critical talent available in the external market, a concern expressed by 62 percent of respondents. Another factor is the challenge of effectively and efficiently managing an organization’s current talent, a concern stated by nearly half (47.6 percent) the respondents. Finding and keeping the right talent is part of this distress, as is determining how to shift from traditional workforce management tactics, such as time cards and paper requests for time off, to more automated solutions.
“Many organizations are struggling to understand which skills will drive the business forward, although many clearly perceive a lack of technological skills and express a need for data analytics skills specifically,” Moon says. “There is also more interest in the so-called soft skills like a person’s ability to collaborate, communicate, and get along well with others. That’s perhaps the biggest change in workforce dynamics that is currently underway—a potential employee’s cultural fit with the employing organization.”
Benwitt agrees, noting that a college degree that has long been considered by many companies to be of little use in the world of business—Bachelor in Liberal Arts— has suddenly gained cachet. A recent article in Forbes called a BA “tech’s hottest ticket.” The magazine reports, “The war for talent has moved to nontechnical jobs …the social alchemists who can connect with customers.”
“A liberal arts degree is much more essential today,” says Benwitt. “More and more companies want to hire people who are creative, interesting, willing to try new things, and easy to get along with. Such individuals are more apt to work with others in a spirit of collaboration to achieve the organization’s mission. If they lack certain skills, you can teach them.”
Benwitt calls these job candidates “purpose” employees. “The way to attract and motivate the Millennial generation is to connect them to a purpose,” she says, noting that she recently read a “great book” on the subject, The Purpose Economy, by Aaron Hurst.
“The book posits that today’s young employees want to serve needs greater than their own,” Benwitt says. “If employees feel a company’s mission is aligned with their sense of purpose, they’re more likely to rally around this mission. And that tends to keep them working for the organization and not looking elsewhere for employment.”
Purpose is important to the National Aquarium. “We are a mission-driven organization,” Osunsade says. “We get the most traction with candidates when they feel a connection to our mission to inspire conservation of the world’s aquatic treasures and our vision to fundamentally change the way humanity views the ocean.”
A related factor in talent retention is the need to assess the level of employee engagement in their jobs. Performance reviews have been the traditional means to this end, but the availability of predictive data analytics is making this process less desirable, if not moot, in some organizations.
“I’m all for performance reviews, since it’s human nature for employees to want feedback,” says Moon. “But, there is a need to replace the way they’re done with something more predictive, in which feedback is gathered dynamically and in real time.”
Sears Holdings is an example of a company that has migrated away from annual and mid-year performance reviews to more predictive measures of performance. In this journey, the company has implemented a tool from SoundBoardSM supporting crowdsourced feedback.
Sears’ employees—or associates as it calls them—use the tool to source feedback from individuals they report to and who report to them. They also use the software to receive feedback from the partners they work with and even from customers. Using a star designation system, the feedback rates how the associate is living the Sears culture, demonstrating leadership capabilities, and delivering results.
Open and transparent feedback processes can lead to improved enterprise performance. Aberdeen Group’s study indicates that best-in-class organizations are 2.5 times more likely to use employee feedback to inform their human capital management decision-making. Such organizations also are three times more likely to use customer feedback.
“Companies and employees today want tools that give them a real time sense of how they’re doing, as transparently as possible,” says Moon. “Trust in one’s leadership, team members, and colleagues is the foundation for building a strong culture. Being transparent in communications builds trust, which influences people to be creative and innovative.”
Now that predictive analytics can be leveraged to dynamically assess employee engagement levels, HR must act upon the insights. “The data will inform the right paths to take,” says Moon. “This will help organizations to be more human, turning this data into actionable insights to provide better workforce experiences, driving up the level of happiness across the organization, which can lead to greater levels of productivity.”
Lagunas agrees: “Everyone now accepts the fact that technology is a necessary part of talent strategy. Consequently, to achieve true best practices, HR needs to implement systems that support the new ways of doing things.”
There are plenty of new ways to do just that. “There is an explosion of interest in HR technology right now, with a lot of venture capital moving into the space because of the realization that there is money to be made here,” Lagunas says. “HR is trying to get up to speed and change how the workforce is managed, they can’t do that without the right systems in place, and these vendors are offering them the ability to get them.”
The HCM technology in use by the National Aquarium’s HR organization gives a sense of the number of tools in today’s toolbox. “We are users of several different talent management software solutions—Ultimate Software HRIS, Halogen’s job description builder, and Profiles XT’s candidate assessments,” Osunsade says. “We’re strong believers in the value added by technology, and we are always looking to improve process by partnering with the right solution.”
A Very Different Tomorrow
As these various trends take shape, they promise a very different looking workforce five years from now. “The adoption of cognitive computing and other technologies are disrupting the workforce,” says Bersin. “Traditional jobs are going to go away (and) people will be more like talent who move from project to project.”
At the same time, traditional approaches to performance management will become more like the “Hollywood movie model. The workforce itself will be younger, more located in Asia, and more dynamic and demanding than ever,” Bersin says.
Obviously, HR a half-decade from now also will be quite different. With so many new technologies coming on stream or in the works, Benwitt even questions the need for today’s HR department in future.
“With the conversation shifting on the subject of talent management, and all these new tools providing these extraordinary insights, HR as it now looks may not be needed anymore,” she explains. “So much will be outsourced to technology providers. Internally, hiring managers will be entrusted and held accountable for tasks they’ve historically relied on HR for.
“I don’t mean to talk myself out of a job,” she adds, “but we’re all using our mobile devices to communicate and collaborate, a dynamic that will only grow. Companies will become digitally connected ecosystems, which we’re already seeing occur. I’m going out on a limb, but not long from now HR will have transformed into more of a consultative capacity, with an important seat at the strategy table. That’s where we’ve wanted to go for a long time anyway.”