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HR needs to become more strategic

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The traditional HR role is becoming obsolete as business demands a new breed of C-level chief human resources officers (CHROs), say industry experts.

Speaking ahead of the upcoming HR Summit and Expo Africa 2015, to be presented in Johannesburg by Informa, local HR experts noted a significant shift in the role of human resources and human capital professionals.
The most important change is that HR now has to demonstrate true business value, and take its place in the C-suite as a strategic role player, they say.
Shaun Rozyn, executive director of executive education at the Gordon Institute of Business Science (GIBS), comments: “In the July/ August copy of the Harvard Business Review, the cover title commanded: ‘It’s time to blow up HR and build something new’. One of the lead contributors, Wharton Business School’s, Professor Peter Capelli, asserted that ‘business leaders tend to see HR as a valuable asset during talent crunches but as a mere nuisance when times are better’.
“He called for HR to do more to contribute to ‘the strategic agenda’ and challenges the HR function to ‘…rather than waiting for the CEO to tell them what to do, HR leaders must strongly advocate for excellence in every process the function touches (or should touch), from layoffs to recruiting to performance management’.”
Ronnie Toerien, HCM sales development and strategy leader: Africa at Oracle, says HR must play an increasingly strategic role in risk management, succession planning and harnessing digital technologies to help drive business growth. “The days of HR being record keepers and payroll administrators are over, HR has to start adding value to business and transforming to the digital environment.”
Human capital management in Africa is challenged on a number of fronts, say Toerien and Rozyn.
“The human resources (HR) or human capital (HC) function continues to come under pressure to demonstrate the strategic value it contributes, especially as the global economy stutters along and organisations begin to batten down the proverbial hatches through more conservative allocations of capital and project streams and embarking on various forms of cost containment,” Rozyn notes.
GIBS, through its research and engagements with organisations across Africa, has determined that key challenges include the speed and the accuracy of the HR ecosystem and HR’s ability to strategise, craft transformations and interventions and adapt processes and systems to respond to the needs of the organisation.
“Another issue is the mandate and structure of HR,” Rozyn says. “Ram Charan, the famous author of Execution, recently proposed that HR be split in two parts, between the transformational and transactional parts of the function. He proposed that the routine elements of the function could eventually be outsourced or placed under the financial function. The areas of focus should be the change readiness and strategic capacity and capability building parts of the function.
“This drives home the point that greater alignment of HR to the business strategy would require that the trifecta of C-suite executives be the CEO, CFO and CHRO. This need for alignment expands to the alignment of the external brand and customer value proposition (CVP) to the values, attitudes and behaviours of internal staff encapsulated in the employee value proposition (EVP).”
Toerien believes the emergence of the Millennial workforce and the age of digital present some of HR’s biggest challenges.
“Talent management is a major challenge as a new generation enters the workforce,” he says. “Where the baby boomer generation might have stayed with an organisation for the duration of their career, a Millennial stays for around three years. This has a dramatic impact on recruitment, staff retention and succession planning.”
Millennials not only tend to move jobs faster, they also change entire careers – a trend that complicates skills development and human capital management, says Toerien. “The expectation is that by the time the average Millennial is 30, they will have changed careers five times. So attracting and retaining this new generation of employee demands new approaches in line with the way Millennials engage and communicate.”
HR needs to harness the primary Millennial technologies such as social media and mobile to recruit, train and engage the new generation workforce, he says. “For example, if you place a recruitment ad in the newspaper, the applicants you get will likely be older people. Social media recruitment is the route to attract younger employees. And in the face of a shrinking attention span, you can no longer train staff in 40-minute presentations. Now, the average attention span is three to five minutes, so HR needs to adapt to deliver learning through short multimedia clips.”