We live in a new age – a digital age that requires companies to move away from their traditional business models and digitally transform. Since the year 2000, over 52% of Fortune 500 companies have disappeared as a result of digital disruption – a clear reflection that it’s time for businesses to re-evaluate their business strategy if they want to accelerate growth and remain relevant.

A recent report from Management Today and Sopra Steria found that fewer than half (45%) of UK chief executives and directors are prepared to say that their organisation has a clear, specific strategy for improving employee experience – an indication that companies are failing to apply effective HR strategies to develop a more engaged and productive workforce.  The dynamic between employer and employee is changing, and organisations must implement strategies, technologies, and practices that modernise their workforce and bring a competitive advantage.

From transactional to transformative

Digital transformation is moving HR from a focus on process automation to a focus on business impact and engagement. This does not mean however, that processes disappear, but HR must understand the meaning behind the processes in order to have the greatest impact.

It’s time for the HR department to step away from being admin heavy and start becoming more integrated in the business

So, what steps can HR take to ensure this transformational HR occurs in their business?

1. Simplicity

“Simplicity is the ultimate sophistication” said Leonardo da Vinci, and when it comes to driving transformation in your HR department simplicity is key. It’s important for organisations to embrace automation and consumerisation, and adapt to their business needs.

We have come a long way since 1999 when cloud computing was first introduced. Nowadays, you do not need to have software installed on your systems in a complex way. Instead, global organisations can access information from anywhere in the world. Any HR systems the business uses can be personalised by country and include branded language, allowing for more collaborative and productive work.

Similarly, the company data is secure. As the data is stored in the cloud, it is often more secure than when you store data on your own company premises. The reassurance that your data is secure is also particularly important for compliance with the incoming GDPR. Having both your company and customer data secure will ensure that you are complying with the new regulations.

Keeping processes simple when transforming your HR department demands creativity and design. HR is disrupted by technology and in order for businesses to drive continuous innovation, keeping these new processes simple is a must.

2. Intelligence

When businesses consider a strategic approach to HR, they must focus on the following areas:

• Learning
• Performance
• Recruiting

Learning, including methods of learning, has changed significantly in the digital age. Modern learning now consists of classroom learning combined with digital learning. In the workplace, colleagues can recommend interesting books, websites or podcasts, but if you want specific learning material, tailored to your own skill set, then a machine learning-based learning platform is the place to go. Machine learning algorithms, used in our own platform, can identify patterns and make relationships between how successful a person can be and the type of skills they need to develop, and will recommend the learning content they need to improve – much like Netflix’s recommendations section.

So why is this a good thing? Well, a 2014 Bersin by Deloitte study found that organisations with a strong learning culture are 92% more innovative, 52% more productive and 56% more likely to be first to market. Implementing a learning culture in your organisation will contribute to employee motivation and retention, ensuring that your workforce thrives. 

Performance is important to monitor, particularly as your organisation moves towards a more strategic approach to HR. Having a clear understanding of your people’s achievements, how they work and collaborate, how they set up goals, and what motivates them are important areas to consider when trying to engage your workforce.

Also, start moving away from annual performance reviews and introduce semi-annual reviews. Beginning a continuous review process will encourage discussions and conversations – reviews judge the past, while having a conversation tries to change the future.

According to Brand Hall Group’s 2014 Performance Management study, companies that invest in ongoing performance management improve revenue (70%), retention (72%) and customer satisfaction (54%).

Recruiting and changing your recruiting strategy is essential when implementing transformational HR. Years ago, we used to talk about applicant tracking systems (ATS), but today we talk less about ATS and more about candidate relationship management systems.

It is important to build relationships with your candidates and put them first, instead of the company. The image that your company portrays will influence how a candidate sees you and how they may in turn recommend you to their network.

3. Speed

Doing something quickly doesn’t always mean doing something badly. Being efficient will help your company thrive. Identify where you lose time and where you could gain time. This will ensure efficiency without losing quality.

Take your HR department on a big data journey, master the technology and competency in order to have business-oriented decision making. HR is just as important as sales, marketing, production or R&D, you just need to prove it. Utilise your data and transform your department. Speed up your processes while making a greater business impact.

If you start to combine all of the above, you’ll begin to develop a real, transformational HCM strategy. Ensure you start focusing on transforming your department, changing from operational and moving towards a business-driven talent strategy that aligns HR with the entire business, and brings greater business impact.

If you want to help HR drive business success check out our 10 ways to make it happen and put your HR strategy into action.