Analytics, Digital Transformation Will Shape HR Post-Pandemic

​If 2020 was a challenging year that saw HR departments delay many plans, stability may be just as elusive in 2021, according to a recently published report. 

The Hackett Group polled more than 300 executives at midsize and large companies for a report released in December 2020 and found that 41 percent of respondents are predicting that conditions will stabilize by the second half of 2021, with 36 percent saying it will take longer. Only 23 percent expect stability sooner, the report shows. The Hackett Group is an advisory and technology consulting company based in Miami.  

The report notes that companies will still be dealing with the coronavirus pandemic for some time, with the shift to remote work being one of the changes that is expected to last.

The report also found that most companies plan to bring on new technologies. Cloud computing; collaboration technologies; and digitization of processes, assets and content will be key areas of focus.

HR technology is increasingly important to improve the efficiency and effectiveness of business operations and to enhance the employee experience, said Anthony DiRomualdo, senior director of HR Research at The Hackett Group and co-author of the report.

"The big challenge in 2021 is putting in place the digital infrastructure, the digital service delivery model for HR so that it can be done in a sustainable way at scale," he said. He added that currently HR is using workarounds and temporary solutions to keep businesses running.

Another key issue, the report said, is improving HR's analytical, modeling and reporting capabilities. Most HR organizations haven't developed the necessary skills, tools, technology and infrastructure to capture and analyze employee data that gives insights into improving business and workforce decisions.

Data collection and analysis, DiRomualdo said, has frustrated companies for more than a decade. The emphasis on data analytics and predictive analytics will require skilled employees who can extract meaning, create a storyline and interpret what parts of the data are relevant to the co-worker who is trying to make a critical decision.

"Whether it is how we improve retention or how we identify employees who are likely to leave and what we can do to prevent that, data typically highlights a problem and it can help to inform the solutions," DiRomualdo said. "Having staff that are comfortable with interpreting and using data as part of how they work in their roles is another area that HR has to continue to develop."

Smaller companies often struggle to get the employees with the right skills to help a company make the jump from metrics to analytics to predicting events. There are other systemic problems too, said Julie Schweber, a senior HR Knowledge Advisor at the Society for Human Resource Management.

"At smaller organizations, they've got payroll on one system, benefits on a different system, and they are tracking time on an Excel spreadsheet," she said. "Some smaller companies don't have any type of talent or applicant tracking system, so folks are doing that manually."

In these situations, HR managers will need to explain how digital technology and analytics can save thousands of dollars in work hours.

"This moves HR from tactical to a much more strategic position, and that's where HR can be of value," Schweber said. "Usually in HR, we have to quantify that in dollars and time to the leadership team."

She added that if an HR manager can show how much manual processes cost and how technology can reduce inefficiencies while saving money, then the leadership team might be convinced to invest in technology.

"It's helpful to be able to frame the value of technology to the organization," she said. "It demonstrates to the senior leadership of the company not just that it will make life easier for employees, but the value that it will bring to the company. That can be very helpful."

The report recommends that companies strive to meet the following goals:

1. Accelerate the migration to cloud-hosted applications and platforms. Adopt advanced analytics tools and smart automation. Eliminate manual tasks and replace them with paperless processes.
2. Utilize digital tools to improve recruiting, learning, performance management and strategic workforce planning capabilities.
3. Reinvent the HR operating model to align high-level HR business partners with business leaders. Utilize centers of excellence for the creation of innovative programs and effective implementation. Focus on improving employee experience through digital channels and shared service centers.
4. Create HR agility by leveraging flexible teams, remote working, third-party staff augmentation, digital processes and streamlined governance.

Nicole Lewis is a freelance journalist based in Miami.