Aligning HR Tech to Strategy

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Susan R. Meisinger, Former President/CEO, SHRM


Susan MeisingerSusan R. Meisinger, SPHR, J.D., is a widely read columnist on HR leadership for HRExecutive Online. She speaks and consults on human resource management issues and is the former president and CEO of the Society for Human Resource Management (SHRM), the world’s largest professional association devoted to human resource management. Prior to joining SHRM, Meisinger was appointed by President Ronald Reagan as deputy undersecretary in the U.S. Department of Labor and was responsible for more than 4,000 employees and enforcement of more than 90 U.S. employment laws. 

I recently attended a meeting of senior HR executives that was hosted by a large company headquartered outside of Boston. During the meeting, the company's chief human resource officer shared her experience working with a new CEO who was focused on transforming the corporate culture. The company works in an industry that demands constant innovation, and the CEO is determined to enhance the organization's capacity to innovate by reducing layers of management and making the company more nimble.

During the question-and-answer period, there were lots of questions about how her team was helping manage the massive changes throughout the company, as well as within her own team of HR professionals. She was asked what competencies she was focusing on for the development of her own team; what did she think they would need to be candidates for a CHRO position?

There were no real surprises in her list of competencies—business acumen, change management, influencing and communication skills, executive compensation—but then she paused and said that she felt that competency with managing technology was growing rapidly in importance, and that HR professionals really needed to focus on this area of their own development.

I wasn't really surprised by her comments. The growing importance of competency with technology was reflected in both the SHRM Competency Model and the last update of the University of Michigan competency model. But I think her comment was influenced by her own recent experience with changing technology partners after many years with one vendor. The change was necessary to help her company better align HR contributions to the business strategy. The company had realized that if it really was committed to creating a more agile company with the ability to embrace rapid change, it needed to ensure that its technology infrastructure would support the strategy. 

Once it spent time analyzing its entire technology infrastructure, including its accounting and CRM systems, the company realized a change in HR technology—which allowed for greater interface between functional areas—was necessary to help it advance its strategy.

Making sure that you have done everything possible to align your HR technology with your organization's strategy isn't something that should be reviewed only every few years when vendor contracts come up for renewal. It has to be something that HR professionals monitor on an ongoing basis, just as you are responsible for monitoring progress against succession plans, compliance with various statutory requirements or ensuring that compensation strategy continues to support the business strategy.

This means being aware of new technologies as they come online and being aware of what technologies your competitors may be relying on. It means understanding the cost/benefits of various tools that are available and being able to recognize the difference between technologies that might provide you with interesting information versus technology that can provide you with important information and insights.

Maintaining currency in new technology trends isn't easy. And in an environment where there is heavy competition for your time and attention, spending time on something just to stay current can seem impossible. But I believe technology currency is now, and will forever be, a foundational competency for HR professionals who truly want to add value to their organizations.

For many HR professionals their technology focus has been on HRIS systems that helped streamline HR processes such as tracking applicants, conducting open enrollments, making payroll payments, monitoring time and attendance—or basic record keeping. It's been about increasing HR efficiency by eliminating as much of the transactional aspects of the job as possible. And that's a good thing—it allows HR professionals to have more time free to focus on strategic imperatives instead of "administrivia."

Today, HR professionals also need to know how to leverage some of the social networking technologies to help build connections with candidates, between employees or between employees and customers—based on how enhanced connectivity will advance the business strategy. HR professionals need to understand mobile technology and embrace the reality that candidates, employees and customers all expect to be able to access the organization using mobile technology. 

HR professionals need to recognize that GPS technology and "wearables" are rapidly spreading, allowing employers to monitor where, when and how workers are working. HR professionals must be prepared to guide their organizations in determining how much of this information is too much information and how this information is best used, and be prepared to articulate where an employer's right to know ends and employees' rights to privacy begin.

Although for some it will be a challenge to fully leverage HR technology to advance their organization's strategy, those who fail to do so risk missing out on some of the most exciting developments in their field. New data mining capabilities are allowing organizations to become more competitive and successful. It is increasingly possible to rapidly analyze diverse data sets to inform the entire business—not just HR functional areas—by providing insights that were previously difficult to discern because it was too difficult to analyze when spread across multiple systems. Now, more than ever, HR professionals and other executives can turn information into knowledge from which decisions can be made.

For example, JPMorgan Chase & Co. has developed an algorithm designed to identify rogue employees, relying on multiple data inputs such as workers who skip compliance classes, violate personal trading rules or breach market-risk limits.1

FinCo Management built predictive turnover models for its call centers in an effort to reduce turnover. It developed an algorithm that pulled from historical personnel data about individual attributes such as tenure and career level, as well as external influences, such as the outside labor market and where employees resided. The analysis provided insights on what the company could do around compensation, career development, experience levels, mobility and work/life balance to drive retention.2

Relying on data it had available, Bon-Ton, a large retail chain, identified attributes of more successful cosmetics sales reps by screening candidates for traits such as cognitive ability, situational judgment and initiative-taking. By focusing hiring efforts on those who scored highest, the store was able to increase sales per representative and lower turnover.3

Rather than ranking knowledge of HR technology low on the list of things to follow, HR professionals need to move it to the top of the list. Pay attention to what the software companies are doing in the HR space. Talk to colleagues who use different systems to learn from the lessons they may have learned. Recruit tech-savvy HR professionals onto your HR team.

A tech-savvy HR function is critical not only because it allows HR to help drive and measure worker productivity and contributions to the business. It's critical because it models behavior that employers will need from the entire workforce, when technology is likely to redefine the very nature of work. The rapidly developing availability of robots to perform work previously done by people, combined with great strides in the development of artificial intelligence able to analyze and assess situations and conditions that only human could once analyze and assess, will cause unrelenting pressure on workers to learn, change and adapt to new roles.

And if HR has not demonstrated that it is able to do this for its own function, how will it ever be trusted to help do it for the entire workforce?

Endnotes

  1. Son, H. (2015, April 8). JPMorgan algorithm knows you're a rouge employee before you do. Retrieved from http://www.bloomberg.com/news/articles/2015-04-08/jpmorgan-algorithm-knows-you-re-a-rogue-employee-beforeyou-do
  2. Park, M. (2015, March 5). Beyond forecasting: Use predictive analytics to enhance organizational performance. Retrieved from http://www.shrm.org/hrdisciplines/technology/articles/pages/use-predictive-analytics-for-organizational-performance.aspx#sthash.hePhXHT0.dpuf
  3. Gardner, N., McGranahan, D., &Wolf, W. (2011, March). Question for your HR chief: Are we using our 'people data' to create value? McKinsey Quarterly. Retrieved from http://www.mckinsey.com/insights/organization/question_for_your_hr_chief_are_we_using_our_people_data_to_create_value
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