Just two days provided a fascinating view into the rapid pace of change in managing HR and employee activities, and the people and services striving to keep up with the dramatic transformations in the workplace. Attending #HCMWorld 2017, April 11-13, 2017 in Boston, to learn and cover people analytics trends, I came away with a new world view!
For those in HR who understandably continually find themselves so busy with their day-to-day transactional responsibilities, you might want to sit down before you read this… because the future is here! These are no longer sci-fi or pie-in-the-sky concepts.
We are in the midst of one of the most significant global changes affecting all aspects of the workplace and our lives. And it’s happening with lightning speed! Not only must these concepts be understood but they must be planned for, embraced, and actively engaged with in order to adjust to tomorrow’s workplace, today.
Josh Bersin was one of the keynote speakers and addressed Bersin by Deloitte’s Global Human Capital Trends 2017 report. The top human capital trend this year was identified as “The Organization of the Future: Arriving Now,” and posits “Given the pace of change and the constant pressure to adapt, it is not surprising that executives identified building the organization of the future as the most important challenge for 2017. In this year’s survey… 90 percent rated it as important or very important.” Yet according to the report, only 11% state they actually know how to fix the company’s HR problems.
The Human Capital Trends Report also states, “Companies should focus more heavily on career strategies, talent mobility, and organizational ecosystems and networks to facilitate both individual and organizational reinvention. The problem is not simply one of “reskilling” or planning new and better careers. Instead, organizations must look at leadership, structures, diversity, technology, and the overall employee experience in new and exciting ways.”
Similar results were born out by Mercer Talent Trends 2017 Global Study. Katherine Jones, Partner and Director of Research at Mercer, addressed key takeaways from the report at #HCMWorld, showing that a whopping 9 out of 10 executives are planning an organizational redesign in the next two years. The redesigns span from moving support functions to shared services, a flattening of the organization structure, decentralizing authority and eliminating roles/functions/departments for greater efficiency, agility, customer intimacy, innovation and, of course, lower costs.
So what does this mean for HR now? It’s incumbent on HR to help businesses adapt to the frenetic pace of change affecting the workforce. To do so, be sure to familiarize yourself with these key concepts, critical to HR’s emerging lexicon.
Fourth Industrial Revolution
The Fourth Industrial Revolution and HR? Covered at #HCMWorld? What? Well, indeed, this is a very relevant concept as I quickly learned.
“Imagine a future where we are managing more than human resources. Robots are already a very real part of the workforce.” Case in point: a hotel in Nagasaki, Japan which is run almost entirely by robots. “What impact does that have on HR? Fewer physical workers? Yes. Retraining existing workers? Yes. Hiring a different kind of worker? Yes. And–to get to the nitty gritty–what about scheduling workers? What happens when a robot calls in “sick”? This scenario is posited and addressed by ASUG, leaders in digital transformation, as it considered Transforming HR to Meet the Needs of the Fourth Industrial Revolution.
According to the World Economic Forum, “We stand on the brink of a technological revolution that will fundamentally alter the way we live, work, and relate to one another. In its scale, scope, and complexity, the transformation will be unlike anything humankind has experienced before.” WEC elaborates: “The possibilities of billions of people connected by mobile devices, with unprecedented processing power, storage capacity, and access to knowledge, are unlimited. And these possibilities will be multiplied by emerging technology breakthroughs in fields such as artificial intelligence, robotics, the Internet of Things, autonomous vehicles, 3-D printing, nanotechnology, biotechnology, materials science, energy storage, and quantum computing.”
WEC asserts that the fourth industrial revolution will result in long-term gains in efficiency and productivity, such as dropping transportation and communication costs, more effective logistics and global supply chains, and lowering trade costs, which will open new markets and drive economic growth.
Yet there is also the likelihood of disruption. As automation substitutes for labor across the entire economy, the net displacement of workers by machines might widen the gap between returns to capital and returns to labor. On the other hand, it is also possible that the displacement of workers by technology will, in aggregate, result in a net increase in safe and rewarding jobs.
WEC states, “Overall, the inexorable shift from simple digitization (the Third Industrial Revolution) to innovation based on combinations of technologies (the Fourth Industrial Revolution) is forcing companies to reexamine the way they do business. The bottom line, however, is the same: business leaders and senior executives need to understand their changing environment, challenge the assumptions of their operating teams, and relentlessly and continuously innovate.”
Forbes describes the Fourth Industrial Revolution as follows: “In short, it is the idea of smart factories in which machines are augmented with web connectivity and connected to a system that can visualize the entire production chain and make decisions on its own… And it’s well on its way and will change most of our jobs.” Forbes goes on to share a mind-bending projection: “As automation increases, computers and machines will replace workers across a vast spectrum of industries, from drivers to accountants and estate agents to insurance agents. By one estimate, as many as 47 percent of U.S. jobs are at risk from automation.”
“In order to thrive, business leaders will have to actively work to expand their thinking away from what has been traditionally done, and include ideas and systems that may never have been considered. Business leaders must begin questioning everything, from rethinking their strategies and business models, to discovering the right investments in training and potentially disruptive R&D investments… The future is happening around us. And we must rise to the challenge to meet it and thrive in the new industrial revolution.”
A related concept addressed at #HCMWorld and that should be part of HR’s new lexicon is “deep learning.” In Machine Learning in Human Resources – Applications and Trends, Daniel Faggella writes that HR “has been slower to come to the table with machine learning and artificial intelligence than other fields—marketing, communications, even health care. But the value of machine learning in human resources can now be measured, thanks to advances in algorithms that can predict employee attrition, for example, or deep learning neural networks that are edging toward more transparent reasoning in showing why a particular result or conclusion was made….The value beyond numbers for CEOs and managers is the power in understanding what’s actually happening within a company i.e. with their people.”
Faggella adds, “While competition for the best people has driven many HR departments to use algorithmic-based assessments, a CEB article on using machine learning to eliminate bias cautions that human oversight is still of paramount importance.” It’s not enough to act directly on data insights, but to use this information in tandem with driving question such as:
1) How I can link applicant traits to business outcomes?;
2) Which outcomes should be our focus when hiring?; and
3) Can predictions (hiring and otherwise) be made in an unbiased way.
Faggaella notes that machine learning HR applications are already helping HR in the areas of applicant tracking and assessment, attracting talent, attrition detection and individual skills management/performance development and goes on to provide examples of future HR machine learning applications in the areas of post-hire outcome algorithms, internal management, increased behavior tracking and data-based decision making.
Can Machine Learning Make HR Better? by Meghan M. Biro on TalentCulture describes deep learning as “The ability for artificial intelligence (AI) algorithms to learn from our behavior using brain-like structures called neural networks, and it’s changing the field of human resources in significant ways.” She writes, “AI programs can predict outcomes based on past experiences fed into the program. Because AI can recognize patterns and analyze data at light speed, it can help HR directors make decisions with greater confidence. From finding and recruiting prospects to streamlining employee assessment processes, machine learning and AI can make it easier for HR executives to do their jobs better—and today’s technology is only the beginning.”
Biro shares a few ways AI can work with HR pros:
1. Help find the right job candidates from a nearly endless pool of possibilities.
2. Assess candidates to find the best job position for them.
3. Evaluate more candidates faster with machine learning.
4. Improve employee satisfaction through regular, unbiased performance reviews aided by AI.
5. Reduce employee turnover through more effective hiring techniques.
Another potential game changer for HR and the workplace related to deep learning are chatbots, which employ deep learning. In How Chatbots And Deep Learning Will Change The Future Of Organizations, Daniel Newman writes:
“Don’t let the fun, casual name mislead you. Chatbots—software that you can “chat with”—have serious implications for the business world. Though many businesses have already considered their use for customer service purposes, a chatbot’s internal applications could be invaluable on a larger scale. For instance, chatbots could help employees break down silos and provide targeted data to fuel every department.
This digital transformation is happening, even in organizational structures that face challenges with other formats of real-time communication… Enterprises are increasingly turning to web applications to streamline their processes and make collaboration easier. Still, applications are siloed and unable to communicate with one another. A chatbot could one day render apps obsolete. Chatbots can conduct the same tasks as most applications in one integrated system and tailor the results to the user as the chatbot employs its deep learning algorithms to understand that employee’s typical needs.”
Digital Transformation, HRDisruption, DigitalHR
These three concepts are related and important concepts for HR as we know it. They aren’t just techno-speak or HR mumbo jumbo. They are here and now.
Katherine Jones of Mercer, in her #HCMWorld session addressing the Mercer Talent Trends 2017 Global Study, showed this visual of the current DigitalHR landscape:
Dominique Ben Dhaou of Point North gave a wonderful session at #HCMWorld entitled “Digitalization & Humanisation – Friends or Enemies?” In her session, Ben Dhaou stressed that it’s more than just DigitalHR – The Digital Transformation includes HR, the workplace and the workforce, with disruption resulting at every turn. That’s why change and agility are key.
She also made a strong case for how HR can help with the disruption of the emerging digital workforce. HR can ensure there’s leadership in the organization to facilitate successful transitions, ease concerns, upskill and train, and so much more.
Lastly, Ben Dhaou stressed that with the digital transformation, those traits that make us uniquely human are increasing in value. HR and businesses are increasingly seeking employees with strong ethical and values driven traits to balance the digital transformation effects.
The future is NOW, as they say. Understanding these trends and how they are playing out in your workplace now, and in the coming years, speaks volumes of a whole new lexicon for HR. Hold on tight!
Interested in these issues? You may want to read XpertHR’s Best Practice Guide on HR Transformation. The guide considers what HR transformation is and its benefits to the organization. It describes the tools for transforming HR and the methods for implementing a successful transformation, as well as how HR transformation can be sustained. This blog may also be of interest: How Robots Are Transforming the Workplace.