Step up in the boardroom: How CHROs can walk the path to strategic HR
Today nearly every business has turned into a people business. Driven by forces continuously reshaping the business ecosystem, people have become the cornerstone of success. From changing definitions of flexibility to the digitisation of the workplace, and the entry of Gen-Z into the workforce, businesses face a tumultuous talent landscape. Without turning the factors influencing today's talent ecosystem in their favour, businesses face the threat of achieving their desired outcomes.
In this environment, CHROs will find themselves at the rudder as their organisation's board expects them to take their business out of troubled waters expertly. In other words, CHROs need to up their game plan and make decisive calls that will determine the future of their organisation. How? By reigning over the factors that rule the dynamics of the talent ecosystem with modern tools and technologies.
2022: new factors influencing people's economics
The talent landscape of 2022 has been shaped by several trends that have unfolded over the past two years. These include:
- Diversity and Inclusion: Employees actively look for workplaces with diverse employees today, and these businesses are 25% more likely to outperform their peers.
- Flexibility and choice: 63% of employees consider a flexible work arrangement the most crucial benefit, determining their propensity to stay at a job.
- Purpose and culture: 70% of employees now find their purpose through their work – where work feels purposeless, they are likely to quit and take up another role. Moreover, being respected and appreciated defines the baseline of their expectations today.
- Technology at the workplace: Workplace technology significantly defines the employee experience today, yet, employees want a human touch in some interactions.
- Cost of Talent: The costs of hiring and retaining the right talent have increased, especially for technical roles, which are crucial to improving a business's digital quotient.
All these factors have significantly reshaped the organisational composition of businesses through the Great Resignation. However, businesses are not necessarily more difficult than capital-driven businesses, as that HBR article demonstrates – they need a new approach to profitability and success.
Likewise, CHROs need to reevaluate their HCM strategy in light of the big picture and turn the above factors in their favour.
Shifting people economics in your favour
Today, more than ever, businesses require CHROs to turn the above-mentioned factors in their favour. One of the foundational steps in this direction is to evaluate the fitness of the HR technology in driving successful HCM efforts.
In HR departments, outdated technology stack negatively impacts the employee experience across the lifecycle, hurts inclusivity efforts, adds to the cost of hiring talent, and shrouds the results of interventions. CHROs must therefore estimate what this technology debt costs their organisation and consider the opportunity that HR automation represents in today's people economy.
By transforming the HR function with automation, CHROs can:
- Improve diversity metrics by empowering recruiters with better hiring tools that automate repetitive processes.
- Elevate the employee experience (EE) with timely appraisals, and free up HR teams to direct human touch to employee-facing processes that matter.
- Evaluate the impact of workplace technology on EE and curate policies aligned with employees' current needs.
- Bring down the costs of HCM software while enabling HR managers to contribute to strategic issues like curating better employee journeys.
Automation is the key to shifting people's economics to the organisation's favour. Any strategic intervention spearheaded by automation must, however, begin from the top and engender a tripartite win-win for three key stakeholders:
- the employees,
- the shareholders, and
- HR teams
Here are four crucial action points in this direction.
Winning the CEO's support: eliminate the guesswork out of HCM
To become a strategic leader trusted by the CEO, the CHRO must present evidence-based claims and choices to the CEO. For example, how did a revised leave policy impact productivity and workforce retention?
To answer such questions with numbers, CHROs can rely on HCM dashboards that bring key HR insights and platforms that automate key checkpoints across the employee experience lifecycle. Armed with 360-degree insights into the workforce dynamics, the CHRO will become a trusted advisor to the CEO and help the organisation navigate delicate situations with the best choices.
Step into the CTO's shoes; bring your people insights to HR tech
Digital-savvy CHROs will unarguably outperform their traditional counterparts. However, this doesn't mean the CHRO must take on the CTO's responsibilities. Instead, they must envisage the impact of technology on HCM with a people-centric vision.
Partner with the CTO to understand the cost of technical debt of outdated HR technology and team up to drive automation-driven HR transformations with them. Ask for the CTO's insights as you search for the correct vendor to source your HR automation software, and bring a comprehensive vendor assessment checklist to make the right decision.
Demonstrate the impact of your automation-driven HR transformation
Many HR digital transformation projects fail because their impact needs to be monitored. However, closed-loop solutions that help you track the impact of HR automation natively can help you advance your agenda at the board level.
The key to achieving a positive impact is to follow an incremental strategy by adopting automation. CHROs must analyse the results of pilot implementations and perform cost-benefit analyses in partnership with the CFO of the project's long-term gains. When critical metrics like employee satisfaction, retention levels, expenses, and diversity show an uptick, CHROs will find greater support at the board level to advance their automation agenda.
Saturate the talent pipeline with the right skills
Finally, CHROs will play a critical strategic role in shaping the organisation's talent profile over the coming years. This will be a challenging task, as the organisation's skills needs will change drastically within digital acceleration.
To this end, the CHRO must lead board discussions to understand what the talent profile of the future looks like. The CIO and the CTO will provide critical insights into technical skill sets that the organisation will require in the future and help the CHRO understand the skills gaps.
To close these gaps, the CHRO must build a talent pipeline to get the right skills through the door at the right moment. Arming recruiters with recruitment software that automate the repetitive parts of the process and help them keep the candidates engaged will be instrumental in shaping the future workforce of the organisation.
According to a recent Gartner survey, only 38% CHROs don't actively influence board decisions. This statistic brings a ray of optimism, especially in light of a 2016 Oracle report that demonstrated a greater disparity between the CHRO's strategic position and its inability to fulfil its role. By leveraging digital enablers like automation, the CHRO will be well-equipped to walk the path to strategic HR and steer the organisation clear of the people challenges that threaten the overall business strategy.