We are entering the next age of business disruption – where those who did the initial disrupting will be disrupted themselves, and booted, quite unceremoniously, from the innovation leaderboard at the hand of the very technologies they created.
This may sound unpleasant, but in a world where technological advances are happening literally every second, it’s the reality and human resource leaders need to understand this as much as anyone else.
When it comes to the field of HR, the disruptions are coming just as fast as in any other field. Product portfolios, business models and processes and entire industries are undergoing transformation and HR needs to be responding in kind with transformations of its own. From talent acquisition to new employee onboarding to employee engagement, HR leaders need to completely rethink their processes and operations and anticipate what’s coming as opposed to waiting to react.
Here are the four strategic ways HR leaders can drive digital transformation in their roles and in their companies:
1.Define and understand what digital transformation means for me and my company
Without having a clear definition of what digital transformation uniquely means for you as an HR leader, there’s no way to know and ensure what the intended successful outcome should be or where to begin, especially with human capital organizations.
According to Trasers data, only 7% of business leaders clearly understood the entirety of digital transformation: which is a reinvention of the entire value chain and investments in sophisticated digital capabilities at the expense of the company’s previously successful business models.
Moreover, only 9% of HR leaders understood that digital transformation is about total digitalization of the function to support digital commerce and drive a predictive posture in the company.
HR leaders need to understand that successful digital transformation means taking a holistic approach to change within the organization and within the HR department, transforming things from the inside out.
2.Prioritize Training
Trasers data confirmed that training investments drive more than a third of the effectiveness of HR transformations. However, only about 38% of companies invest adequately in training their HR staff on new technologies.
Regardless of the scale of your organization or transformation strategy, training and change management are critical. HR leaders need to train both themselves AND their teams.
Companies that internalize and incorporate the learnings from their technology are the ones that get and stay ahead. Trasers data also shows that nearly half of all companies today are investing in AI-based automation for employee engagement, HR operations, and digital work cultures. It’s time to jump on that train because it’s moving very fast.
3.Cluster Initiatives
Clustering initiatives is the prevalent model for HR transformations. What does it mean to cluster initiatives? It means grouping large initiatives together to drive transformation, as opposed to taking it one project at a time, producing only moderate results. In human capital, this means that as your organization adopts new HR-related tools and technology, it’s also training its HR department on the new technology while planning on how these new tools will be launched and implemented company-wide and while developing the KPIs. This is just another way of attacking digital transformation holistically and from the inside out.
4.Develop your step-by-step HR playbook
Now that you have a clear definition of digital transformation and what it means both for your HR department and your company (remember: inside-out change), you’ve prioritized training, and you’ve clustered your initiatives, you’re ready to develop your step-by-step playbook for HR digital transformation.
While there are various ways to do this, the most important thing is that this playbook covers everything an organization would need for a successful digital transformation from the inside out.
For HR leaders, developing a step-by-step playbook means:
Building self and team awareness around human capital and enterprise transformations.
Benchmarking your human capital function using powerful data – NOT opinions or hunches – to know exactly where your role and your organization stand in relation to the competition.
Selecting the right technologies. Easier said than done, right? How do you know which to choose? The HR space is exploding with tech right now, all of it claiming to be the next big game-changer for human capital. Do your research – yes, but research will only take you so far. DATA takes you much farther, because you are no longer relying on interpretations: be they yours or someone else’s.
Training and certifying your teams on this new technology (see number 2: Prioritize Training).
Engaging in benchmarking and monitor competitive positioning. Once you have your digital transformation engine roaring, you will want to know how well it’s working. The stronger your predictive analytics capabilities are, the higher your probability of success.
HR typically gets very little “love” when it comes to tech investments and transformation, compared to other departments, such as marketing or IT, but that’s changing fast. The new era of human capital is one of embracing change and being proactive about where to make the next big move and then approaching this move holistically via training, powerful benchmarking and analytics and clustered initiatives.
We welcome your feedback and comments on how CHROs drive digital transformation.
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