Digital HR: A Guide to Technology-Enabled Human Resources

Learning

Preface

PURPOSE OF AND USES FOR THIS BOOK

Welcome to the world of technology-enabled human resources (digital HR). You are embarking on the journey toward understanding the technologies important to HR functions. This text will inform you about key HR technology terms and related topics. It is not its intention to address every new technology; rather, the text examines technology types and groupings to offer an overview of how they can positively impact HR. The goal is for you to understand the valuable contributions you can make in the planning, selection, design, implementation, and evaluation of technology without being a technology expert. The technologies discussed in this book impact anyone with people-development or people-management responsibilities. Each chapter addresses the disruptive technologies, as they are called, and how they can be harnessed to benefit an organization’s HR practice. Legal and regulatory issues are also addressed. In the introduction to the chapter you will find an overview of the technologies in that chapter and their general relevance to HR and the HR technology strategy. In short, it is an explanation of why you should care about the contents of the chapter. Located at the end of each chapter are some resources for digging deeper if you want to examine a given topic in more depth. And each chapter uses questions to encourage you to consider how the topic relates to your organization’s overarching HR technology strategy.

Those who have direct people care or other HR responsibilities and who are unfamiliar with the full range of technologies available to HR professionals will benefit from this book. Readers may include business owners, executives, managers, and information technology (IT) and HR professionals.

Since the technology strategy of your organization is of utmost importance when making a technology decision, the first chapter describes the components of an HR technology strategy. The HR technology strategy theme is carried throughout the entire text. As you are reading through the text, consider where your organization is today on the HR technology spectrum (the as is or current mode of operation [CMO]), then consider the technologies and case studies presented and begin to cast a vision of the future (the to be or future mode of operation [FMO]). How would that vision benefit HR constituents and stakeholders?

Explore and analyze the HR technology strategy in order to mature the future mode of operation. Ask questions. The HR technology strategy must be directed by HR professionals with HR expertise. Knowledge of technology is needed but you do not need to be a technology expert to direct the vision.

Technology terms are italicized and defined at first use. Tips and Tools boxes include recommendations and trial versions of the technology when available. End-of-chapter questions prod reflection on how the technology could align with or extend your organization’s HR technology strategy. The Digging Deeper sections offer you lists of current resources for research beyond the text.

You will not see many vendor names, since each geographical region offers a variety of vendors too numerous to list. As an alternative, we suggest that you join a local or regional HR association or community of practice (such as those on LinkedIn or the Society for Human Resource Management’s [SHRM] website) to identify a list of reliable vendors, consultants, subcontractors, and so on available where you work. Remember, it is very important to find a regional HR association or community of practice (CoP) in which you can participate. These groups will benefit you both intellectually and professionally. Further, your connections may provide much-needed support for your technology-related decisions.

I hope you will turn to this guide again and again as you participate in and contribute to technology decisions in your workplace! Enjoy!

PART I

TECHNOLOGY-ENABLED HUMAN RESOURCES

CHAPTER 1

Technology and Its Impact on Human Resources and Business Professionals

TOPICS COVERED IN THIS CHAPTER

• HR technology terminology

• Impact of HR technology on HR roles

• HR competencies and technology

• Gauging organizational readiness for HR technology

• The competitive edge—effective HR strategy

• HR strategy and leadership

It is an exciting time to be in the human resources field. We are seeing the impact of the technology revolution, now labeled by some as the Digital Age or the Fourth Industrial Revolution. This is no small transformation. All of the major consulting firms offer the same prognosis. Forrester, Gartner, McKinsey, Deloitte, and others point to the radical alteration the disruptive technologies, such as social media, cloud computing, data analytics, and mobile, have on the way we do business. They also have impacted HR.

In fact, HR has perhaps been most shaken up by this technology revolution. As one part of the organization that connects with all workers at every employment stage from recruitment to separation, HR now has systems available in the form of HR information systems, human capital management systems, and HR management systems that handle the entire employee life cycle and more. The new HR systems provide predictive analytics and management services never seen before in technology.

Here is the twist: Perhaps for the first time, HR is in the driver’s seat, fully entrenched in the executive suite making critical decisions that impact the organization. Digital HR is the new professional nomenclature for those HR departments that embrace these new technologies.

Empowered by technology, HR is evolving toward¹

Modern, dynamic, and networked organizations that thrive on organizational structure based on small, agile work teams;

Ongoing employee learning, enabling a learning environment that is flexible and on demand;

Acquisition of talent using leading-edge technology;

Enhanced employee engagement that thrives on technologies such as social networking, prescriptive analytics, and cloud-enabled access to resources;

Performance appraisal models that offer continuous (not periodic) feedback; and

An HR experience that thrives on mobile applications, artificial intelligence (AI), and other innovations.

In a Workforce article entitled HR 2018 Future View, a panel of futurists forecasted (1) the rise of virtual teams enabled by videoconferencing; (2) recruitment using virtual, global, and just-in-time tools tied to a return-on-investment (ROI); (3) data-driven decision–making; (4) continuous learning supported by technology; and (5) a talent management strategy primarily reliant upon systems.² Now, more than a decade later, all of these technology predictions have come true. Even the expected HR competencies and roles have shifted.

HR TECHNOLOGY TERMINOLOGY

There is a whole new genre of systems that handle all of the talent management functions. They are called human capital management (HCM) systems. HCM has emerged in full force, with systems that can handle every aspect of the talent management process. By definition, human capital management is the comprehensive set of practices for recruiting, managing, developing, and optimizing the human resources of an organization.³

For some people, the term human capital management is offensive, as it implies that humans are a type of inanimate object. Understanding that the term is simply meant to encompass all processes of talent management, for the purposes of this text HCM and talent management will be used interchangeably. The terms represent the powerful and all-encompassing talent management systems forecasted above.⁴

IMPACT OF HR TECHNOLOGIES ON HR ROLES

Not surprisingly, the new HR technologies—including HCM—have an impact on HR roles. As technology gains importance, it supports—and in some cases, supplants—many of the people-care functions that HR professionals previously handled themselves. In leading organizations, conventional HR functions have shifted to frontline managers who are tasked with people management, or people care. In this situation, HR professionals partner with managers who provide the people care, while HR takes on the role of HR business partner (HRBP). An HRBP is an HR professional with a customer service mindset who understands the organization’s vision and mission, applies policies that align with the objectives, and executes the HR strategy.

The changes to roles have also impacted the HR generalist and HR specialist positions, making them less prevalent. Organizations now often refer to HR professionals with the following terms:⁵

Strategic partner (typically an executive role)

Change agent as HRBP

Administrative expert (often providing expertise in a shared service center)

Employee champion as HRBP

Under this new paradigm of roles and responsibilities, HR professionals must develop new competencies to fulfill the roles of strategic partner, change agent, employee champion, and administrative expert.

HR COMPETENCIES AND TECHNOLOGY

With the shift to new roles and the introduction of new, powerful HR technologies, the required set of HR competencies have also changed. Promoted by organizations such as SHRM and the HR Certification Institute (HRCI), HR competencies in the twenty-first century differ from those in the twentieth century primarily because of the need for skills that are technology related. For instance, with the advent of social media, necessary communication skills include an understanding of how to create and share content through media for HR purposes. Critical analysis skills must include an understanding of how to use big data to inform HR decisions.

In 2015, HRCI collected over thirty thousand worldwide surveys rating the competencies and performance of more than four thousand HR professionals in 1,500 organizations. In accordance with this study, SHRM provides a set of nine competencies for the HR professional. Two of the nine are related to technology—communication and critical evaluation.⁶

Technology supports, extends, and enhances all HR functions and, if used properly, can ultimately increase the effectiveness of an HR individual, team, department, and organization. HR professionals must have the skills and competencies to maximize the inherent value of these technologies.

GAUGING ORGANIZATIONAL READINESS FOR HR TECHNOLOGIES

An HR professional, whether executive, manager, strategic planner, change agent, administrative expert, or employee champion, interfaces with the technologies used within an organization. As a growing number of HR-specific technologies emerge, the organization’s culture and its disposition toward new technology become increasingly relevant. It is HR’s responsibility to assess the organization’s readiness for new technologies.

A 2017 McKinsey article titled Culture for a Digital Age provides insight to the assessment of organizational readiness for new technology. The article identifies culture as one of the main barriers to a company’s successful implementation of new technologies. The following are key elements of culture that prohibit an organization from moving forward and embracing new digital-age technologies.⁷

Functional and departmental silos,

Fear of taking risks, and

A lack of customer-centric mentality.

Overcoming these cultural roadblocks is the job of the HR department. Let’s first determine what they are and then how to overcome them.

Functional Silos

Functional silos represent what Goran, LaBerge, and Srinivasan call a narrow, parochial mentality of workers who hesitate to share information or collaborate across functions.⁸ Silos have existed within organizations for decades, but the relevance to this situation is that they prevent an organization from supporting and investing in HR technologies that would benefit employees in all of the business units, not just the HR department. This narrow viewpoint can be overcome using simple methods such as routine management job rotation, multidisciplinary teams, and data transparency and sharing, all of which are best enabled by technology.

Fear of Taking Risks

An organization that is risk averse will lack innovation. Risk-taking must not be reckless and implemented on a large scale; rather, it should be inculcated in the culture by allowing small risks. Giving frontline workers the tools and decision-making ability to handle issues can combat risk-averseness. It also frees up the otherwise rigid approach to decision-making in general.

Lack of Customer-Centric Mentality

The lack of a customer-centric view also restricts the adoption of new technologies. When the customer comes first, management is compelled to provide the tools to properly serve the customer. These should be leading-edge approaches; for example, collecting and analyzing big data available through practices and systems that provide current, ongoing information about the customer interests, preferences, and needs. A customer focus requires investment in the technologies and tools necessary to provide excellent customer service.

Elements like the organization’s vision and mission, management philosophy, the tone of labor-management interactions, and the degree of shared agreement about the technology also impact an organization’s readiness for a new technology. Is the organization adaptive and receptive to new technologies, or is it more resistant to technology and the changes it will render? Does the organization view technology as fundamental to its success, or are the technologies viewed as peripheral to the organization’s goals and therefore of lesser priority?

Why do you care about identifying your organization’s predisposition toward technology? Because it will govern how you approach introducing a new technology. This is especially important if the new technology is one that will upset the organizational norms. In that case, you will need to be an employee champion who is also a change agent. Your assessment of the organization’s stance toward technology in general then provides an indicator of the level of resistance you can expect toward new HR technologies. Remember that the majority of organizational change efforts fail.⁹ Consequently, in order to mitigate potential failure of a new technology, your understanding of the organization’s stance toward technology should cause you to adjust your approach. The intensity of your role as change agent will vary based on the receptivity of your organization toward technology. The more resistant to technology your employees and organization are, the more preliminary work you will have to do.

THE COMPETITIVE EDGE: EFFECTIVE HR STRATEGY

Introducing a new technology is not a simple endeavor. It requires assessment regarding the level of pushback that will be met and an overarching HR technology strategy.

An HR technology strategy is separate from and builds upon the organizational strategy. The organizational strategy drives the competencies and behaviors that employees must have. HR must develop a strategy that includes the HR approach to policies and practices that further the organizational strategy. HR must first formulate and execute policies and practices that produce the employee competencies and behavior to achieve the organization’s strategic aims. Second, HR must align the HR technologies with the organizational strategy and in support of the required employee competencies, skills, and behaviors. This is why the HR technology strategy is extremely important: it is both the blueprint and roadmap for the HR technology selection and implementation necessary to support the organizational strategy.

An HR technology strategy that aligns with that of the organization requires the following:¹⁰

A mission statement that includes the organization’s present purpose;

A vision statement of the organization’s goals for the future;

Details of HR technology goals and objectives;

Logistics defining how the HR technology strategy will accomplish its goals and objectives;

Methods for measuring achievement of HR technology strategy goals and objectives;

Budget detailing resources and measures needed to implement the strategy;

Timeline or schedule for completing the objectives, typically three to five years; and

Yearly reevaluation, assessment, and (if necessary) adjustment of the HR technology strategy.

A graphic representation of this approach can be found in Figure 1.1.

Figure 1.1. HR Technology Strategy Components

HR TECHNOLOGY STRATEGY AND LEADERSHIP

Twenty-first century HR practice requires a bold new leadership approach that is neither top-down nor authoritarian as we saw in the twentieth century. Rather, the HR leader must be authentic, collaborative, transformational, and inspiring. HR must make decisions that will impact the organization’s financial well-being. You, as an HR decision-maker, should institute policies that demonstrate your value using best business practices and measurable positive outcomes. You cannot fly under the radar nor can you allow others to make these important decisions for the HR department.

A lack of knowledge about HR technologies should not hobble your leadership. Instead, embrace the leadership role and work in conjunction with your Information Technology department and other business units to find the best solutions. You must collaborate with the business units, employees, and IT professionals in the decision-making and technology selection process.

Leadership of this caliber requires humility and a learning disposition. HR leaders must seek information from the best possible sources using benchmarking, current literature, CoPs, and formal learning opportunities to inform and underpin their decisions. We must inspire others with our vision and demonstrate how the chosen technologies empower employees.

No one should have to clean up after failed HR technology implementations. As HR professionals and leaders, we should have the forethought, organizational knowledge, change agent approach, and skill to avoid such failures. HR professionals are now in the driver’s seat. We can implement change proactively by communicating. We need to use the appropriate technologies to develop workers and empower them by giving them the training and tools they need. Throughout this text we will emphasize your role as a leader to design and execute an informed, successful HR technology strategy.

TIPS AND TOOLS FOR HR TECHNOLOGY STRATEGY

Identify your organization’s strategy, then consider how HR can support and advance it.

Examine the organizational readiness and context for new technologies to gauge change agent role.

Assess your HR departments’ competencies and technologies and their fit with the overall organizational technology strategy.

Create an HR technology strategy that aligns with the organization’s strategy.

Reassess and adjust the HR technology strategy periodically.

GOING FORWARD

HR professionals must be aware of those technologies that can be used to fulfill the mission and vision of the organization. We must be involved in the technology selection and implementation processes as well as in the business process redesign. We should take advantage of the new, sophisticated, labor-saving hardware and software, and represent employees’ best interests in the technology selection process. In so doing we add to our own credibility by being knowledgeable about HR technologies. HR professionals must design an HR technology strategy that reflects the organization’s mission and vision while taking into account the organizational readiness for technology.

The present business challenges cannot be solved using solutions from the past. The HR skill sets that were acceptable in the twentieth century will not suffice in the twenty-first; they must be revamped and updated to incorporate new communication and critical analysis tools. Additionally, we cannot and should not let others make important technology decisions for us, foisting upon us solutions that are not custom-designed to solve HR challenges. Instead, HR professionals need to take the lead to design and implement the HR technology strategy.

End-of-Chapter HR Technology Strategy Questions

Considering your organization’s overall business strategy, answer the following:

What is your organization’s HR technology strategy and how does it align with your organization’s mission and vision?

What additions or modifications to your organization’s HR technology strategy would you suggest to ensure its success?

We will refer to your organization’s HR technology strategy as a living document, subject to review and revision based upon learnings gleaned about major HR technologies and trends. If your organization has no HR technology strategy, this is your opportunity to influence and guide the development of one.

Digging Deeper

Berger, Lance A., and Dorothy R. Berger. 2018. The Talent Management Handbook: Making Culture a Competitive Advantage by Acquiring, Identifying, Developing, and Promoting the Best People. 3rd ed. New York: McGraw Hill.

Decker, Phillip, Roger Durand, Clifton Mayfield, Christy McCormack, David Skinner, and Grady Perdue. 2012. Predicting Implementation Failure in Organization Change. Journal of Organizational Culture, Communications and Conflict 16 (2): 9–49.

Dessler, Gary, and Biju Varkkey. 2016. Human Resource Management. 14th ed. Noida, Ind.: Pearson.

Goran, Julie, Laura LaBerge, and Ramesh Srinivasan. 2017. Culture for a Digital Age. McKinsey Quarterly, July 2017, 1–13.

Harvard