Are you a company struggling to keep up with changing technologies and employee expectations? Look no further than HR transformation, and discuss its elements to see how this roadmap can improve your organization.
What’s the most valuable asset of any organization? Human capital, also known as employees. As Human Resources (HR) sources, maintains, and elevates employees, this department is the most crucial to the organization’s success. Sure, the Sales department brings in customers to support the Finance department’s distribution of paychecks. But, without HR, those departments would not run as efficiently.
Established corporations, not startups who are just beginning their journey, should consider HR transformation as a way to improve their human capital value. Integrated Reporting states human capital is vital to an organization.
Transform the HR function, however, is not a simple procedure. Change is a scary word in the business world. Changing anything, even to improve processes, is especially difficult for established companies.
In order to grow and become even more successful, however, change is necessary. Keeping up with evolving technologies and employee expectations can make or break a company, depending on how receptive they are to those changes. But how do you know it's time to make this transformation, or should you need to implement HR software?
XpertHR breaks down the elements of HR transformation as the case for change, design of the solutions, development, and roll-out of a detailed plan, and review and sustainment of the change. We’re going to discuss these elements and how this roadmap can improve your organization.
Case for Change
Building a case for the HR transformation to present to leaders and stakeholders of the company can be daunting. Creating a clearly defined case for change is necessary to obtain approval, however, especially if it affects the budget.
What is the problem you are trying to solve? Have you researched solutions to the problem (including free to more pricey solutions)? One of the main setbacks to transforming an established HR system is the time required to do extensive research.
SHRM states there are 10 elements to consider when planning the case: problem statement, background, project objectives, current HR process, requirements, alternatives, compare alternatives, additional considerations, action plan, and executive summary.
If all of these are thoroughly researched and argued, your chances of approval increase. The case should indicate to leaders the investment will help the company achieve business goals.
Design of the Solutions
Solutions to HR transformation must be impeccably designed. The design must incorporate the business as a whole since HR touches upon every department. Also, if any business changes are to take effect soon, those changes must also be included (or anticipated if the changes are not set in stone).
Mercer’s 2023 Global Talent Trends research finds that "96% of companies will redesign their HR function, with 54% using agile HR resources to flow to evolving HR project/enterprise needs." Leveraging design thinking can be a key factor in achieving a successful transformation. What is design thinking? Career Foundry states:
Employees are humans, not robots. But some organizations have a problem differentiating between the two. It’s the HR department’s job to ensure employees are seen as humans with human-specific needs.
When designing the HR transformation, it is important to consider what the employees need in conjunction with the business requirements.
A great way to consider employee needs is to include the employees (or a committee of employees for larger organizations) in the design planning meetings. Get feedback on what they would want most with this transformation. This helps you to understand how the employees work and form ideas with their perspectives in mind. This is also a good input to improve your employee experience.
Development and Roll-out of a Detailed Plan
Once the design stage is complete, delivering and implementing a detailed plan is the next step. This plan will set the stage for the adoption of HR software/system and keep it from diverting from what was agreed upon.
Depending on the allotted timeline to complete the change, the best way to establish this transformation is through a phased implementation plan. This ensures the company can still function normally while one change is implemented at a time.
If you are unsure what your timeline should look like, consider these points from Rebecca Murray’s presentation on How to Have a Successful HR System Implementation:
- Identify periods of high business activity and try to avoid scheduling major project activities during this time.
- Include major business time commitments on your project plan.
- Identify contingency points and allot enough time for activity based on resource planning.
Never try to implement a large and complicated business plan at one time. Changes always create at least some confusion, and rolling out the changes in small chunks allows the confusion to be easily and quickly addressed.
Making changes all at once will cause business disruptions and mass confusion that may affect normal business operations. It also does not improve the employee experience!
Review and Sustainment of the Change
Once the HR transformation has been established, set up periodic reviews to ensure it remains on track and is sustainable. It’s also important to collect frequent and consistent feedback from employees to determine if the new HR solution meets their needs.
Deloitte spoke of their own HR transformation and sustainment challenges in their case study Global Business Driven HR Transformation.
In order to achieve sustainable transformation, an organization should have a well-defined governance structure. Such a structure inherently allows for more effective decision-making and establishes a credible platform for HR to consult with the business on its most critical asset - people.
What is meant by a well-defined governance structure? Ensuring the overall solutions “permits the management of implementation activities and can evolve into a structure that will support operations ongoing post-go-live.”
HR transformation must consider how the changes will be supported once implemented. HR supports the entire company, after all, and if the changes cannot be properly sustained, the company may be critically affected. Considering the big picture before, during, and after HR transformation equals successful changes.
HR transformation is meant to keep up with changes in technology and the business landscape. Your employees deserve the best when it comes to the experience HR can provide. Don’t let the competition entice your best employees! Retain your employees by always considering how they perceive workplace culture and experiences.