In recent past, several Companies are found closing down HR depts. And many new ones- especially start ups- are going to have no place for such !
Why ? What are prompting the Cos from taking such a decisions? ….. How are they going to REPLACE the ROLES those departments were playing?
Well, perhaps the prime ‘CULPRIT’ is march of technology and the tools it has created to render many HR functions on autopilot, effectively weaning away –or at least minimizing – the ‘human’ roles associated with such tasks.
Further, even now there are no tools available for measuring the ( positive ) ‘impact’ of HR functions in the overall business growth of an organization. And for those Companies which are yet to firm up strategic vision and delineate corporate mission, having an HR dept become ……..err what u call as white elephants! Ok, may be it is a bit harsh…….but sometimes u tend to blurt out ……..
Ok, now, before we go further, let us get a peek on trends commenced in recent past on HR management (HRM) in medium to large organizations, most of these influenced by external factors:
• Business evolution and its reflection on HR Functions
• Viewing ‘quality’ as a strategic-weapon.
• IT –Tools ( spotting source of talent, ERP)
• Organizations tilting towards flatter-structures
• Outsourcing (Business Process, Knowledge Process, Call centres………those ‘celebrated’ ‘Bangalour’ing shall I say ??)
Most of the above are still in vogue ! Cos – especially those in high skilled service sector – still consider the employees the most important asset ! So what has changed?
Advent of IT tools have made recruitment, a significant part of training and upskilling that can be managed with bare minimum involvement of independent HR functions. So also mundane tasks like attendance , leave and a significant part of appraisal.
Further, nowadays, business intelligence tools ( digging deeeep with Big Data/Hadoop …..)
Even issues like Compensation and Benefits are getting automated barring a few exceptions.
So in many ways, the need for an independent HRM wing in any typical organization becomes a moot point for top management to mull over ! Sort of the proverbial ‘To be or not to be’ shall I say?
And with Globalisation catching up, in many legacy sectors, margins have been thinning down. In such scenario, any functions which are not in ‘line’( ie: which has a direct contribution to the business process) becomes a focus of questioning within any organization.
On the other hand, what are the counter-currents which may force a dedicated HR dept in organizations?
• Globalisation and the changing dynamics
Eg: Increasing heterogeneity of the work force in the business environment entails managing cross-cultural and ethnic related challenges – the conventional team formation stages- forming, storming, norming and performing – takes more time to converge and fructify.
• Downsizing as a sequel to Acquisition/ Mergers:
These raises new challenges because of the potentially different organizational cultures getting pushed to operate together. ( French wine mixed with Russian Vodka! oh , that may be stretching a bit far………..but well, at times ……)
• Changing attitudes & outlook of employees : the current lot are interested to move up the ladder as fast, highly ambitious, restless, go-getters & job-hopping has become very common. This calls for organizations to ‘benchmark’ with the trends external to the organization.
• Increasing awareness among employees : Nowadays employees are more forthright who demand career planning counsel, training, coaching, and other engagement initiatives.
• De-centralisation & employee’s inclination for challenging-tasks :
Employees today wish to get empowered ( authority ) at their level to prove their skills and to get a sense of satisfaction, thrill & achievement. It also results in growth.
In sectors like (Infra) Projects, IT and Pharma, far younger employees are found shouldering responsibility.
Advent of automation shift the focus towards Training & retention of highly-skilled Human resource in the manufacturing sector.
These factors collectively reinforce the need for continuous engagements with employees towards managing diversity, development of competencies at individual level towards the larger goal of organization’s growth.
Further, with increasing awareness about gender equality and work-life balance, Cos are compelled to adopt innovative measures like flexi-working/ longer maternity vacation etc.
So what is the Future of HRM ???
• 3-main areas of future HRM Focus will be :
-Regulatory ( Govt. rules on Hire and Fire : watch What President-to-be Trump is upto…..)
In summary, what will decide the future of HR as an independent functional group in any organization will be the management of Human Capital – Is it adding value to the bottom line (EVA – Employee Value Addition)??? this interwoven with compatibility with STRATEGIC INTENT of the whole organization may ultimately decide whether they will need a dedicated HR function.
Thank you for your patient reading !
Sasindran / Winter 2016