Score: Talent Won, HR Lost

Expert: HR must combat population shortages and lack of skills, and be proactive in utilizing technology to meet the growing talent needs of companies worldwide.

By Aliah D. Wright Oct 1, 2010
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MONTREAL—Ask many employees the function of an HR department and you just might hear the word that makes most HR professionals cringe: paperwork. But, according to Lance J. Richards, SPHR, GPHR, senior director and global practice leader for Kelly Services’ worldwide HR consulting practice, if HR cannot provide “transactional excellence” (the paperwork aspects of their jobs), CEOs will never take them seriously when it comes to talent management, succession planning, and assisting with global growth initiatives.

After all, globalization “is unstoppable,” and it will not work if HR isn't a part of the equation.

Speaking to dozens of attendees at the 13th World Human Resources Congress in Montreal on Sept. 28, 2010, Richards, who lives and works in Singapore, added that in order for HR to thrive during the present economic recovery it must be aware of global trends around the world that are affecting the world of work. The conference, which was attended by 3,500 people from 55 countries, ended Sept. 29.

Unstoppable Globalization

“This recession has changed how we as an HR profession work, and what our companies are expecting from us,” Richards said.

Where HR was once focused on transactional excellence in areas such as employment law, compliance, processing payroll and recordkeeping, it has evolved into areas such as training, performance evaluations, employee relations and recruiting. “Expectations are now higher. We are [asked] to provide things that were unimaginable in the 1950s,” Richards said. “We still have to provide transactional excellence, but if we don’t, no one will listen to us when we talk about talent management or succession planning” or the need for global growth.

Studies from McKinsey & Co. and Hewitt suggest that many managers believe HR still lacks the capability to develop talent strategies aligned with business objectives, he said. Hewitt Associates polled CEOs and found that “58 percent said HR lacks business acumen,” Richards said.

“Being good at HR is still required,” Richards said. “But it is no longer sufficient for us to be successful in our business. “We must know the business as well as we know HR; in a lot of companies today, we are guilty of getting this backwards.”

He added that line managers “are expecting a level of sophistication from HR that we haven’t delivered in years.

“Our businesses have changed dramatically over the last 10 years,” he added. “Talent supply chains have changed so dramatically that we can’t think short term anymore.”

In 1999, management and consulting firm McKinsey released a report that said the war for talent would continue for the next 50 years, Richards pointed out. “But in my opinion it’s already over. Talent won; we lost. We as employers are battling against some dire demographic trends.” 

Reproduce, Please

Richards said that of all the forces converging on HR managers, few would be as dire as present global demographic shifts that are “locked in for the next 40-50 years.”

It’s not a matter now of population shortages—though there are plenty worldwide. 

“It’s not a people shortage; it’s a talent shortage,” he said. Even in the early phase of economic recovery, hiring managers are likely inundated with resumes, but many of these applicants lack the skills necessary to do the work in many fields.

Richards said that in some areas of IT, science and health care, the talent shortage never actually disappeared, and recruiters are continuing to find it challenging to place people in those positions. Lack of education is to blame. So are population cycles.

“The Japanese government has begun to encourage employees to take two-hour lunches,” he said. “They want people to reproduce.”

But even if people are encouraged to have more children, “we’re 20-plus years away before they’re out of college.”

There will be fewer people of traditional working age, relative to the older population.

“So we as HR are going to have to start adapting,” he said.

Technological Adaptation 

The good news, Richards said, is that technology is shifting and allowing HR to access talent in ways like never before. “We have new ways to identify and get people.” 

HR should start thinking of scrapping the traditional ways in which people work as well.

“Workforce virtualization” can allow people to work ubiquitously. 

“If you can’t move the worker, move the work,” he said. Or, “Can’t get to your company? There’s an app for that.”

Talent can come, too, from other countries. “Every day in Puerto Rico a [departing] plane carries one health care worker who will not return to Puerto Rico,” he said. “Perth, Australia needs mining engineers, so they’re recruiting engineers in Canada and Russia. They can teach them English a lot faster than they can teach them mining.”

Prepare for Generation B

Lastly, Richards said HR has no choice but to embrace the needs of Millennials who don’t want to work 9-5, who want to work collaboratively, expect work-life balance and who are loyal to their professions—not their companies.

Give them the things that are important to them, he said.

He told attendees to consider Generation B as well, those who are presently 6 years old. They’ve grown up with Apple laptops, and touch screens, know how to Google and surf YouTube, and have likely taken computer classes daily in kindergarten.

“In 12 years, this iPad will be in a Smithsonian,” he said holding up the new Apple device. “What is the technology going to look like when [the 6-year-olds] get in the workforce?”

He said it’s imperative for HR professionals to realize they’ll have to be prepared to meet the needs of workers of the future, too.

“This is relevant to our industries and relevant to our companies. We need to be sure we know who they are and what they are.”

Aliah D. Wright is an online editor/manager for SHRM.

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