There’s been lots of buzz and debate on digitization and digital transformation and today everybody accepts it’s here to stay. It’s pretty obvious that companies that don’t factor in this digital ecosystem will have difficulties surviving.
There’s also growing consensus that HR’s role ideally positions it for rolling out a digital strategy on this basis, so long as this comes with a transformation process.
This involves HR shifting from being the custodian or manager of transactional processes to becoming a digital business partner — either fully or partially — where HR behaves digitally and sets an example to the rest of the organization as well.
But the conundrum is that no one has a truly clear vision of what role HR should play in digital transformation — especially if it is to be successful and smooth throughout the organization.
Tackling this HR conundrum
So on this basis, the best way forward is to take a better look at the “Whats” and “Hows” of HR’s role for the digital transformation of the entire company. Using this approach, we will encounter at least three aspects to digitalization based on these time-old core questions that need to be clarified repeatedly, just to make sure that HR is always aligned to the company’s goals:
What digital transformation does the company take on and why?
What should HR do to support the company’s digital transformation?
How can the HR function be transformed and evolved?
Back to basics, defining digital transformation
Before tackling these questions, based on our experience, we find that it’s important to first properly define the concept of “digital transformation” to make sure that all stakeholders in the transformation are on the same page.
So, for example, on The 2014 State of Digital Transformation the digital analyst on disruptive technology Brian Solis states that digital transformation is about: "The realignment of, or new investment in, technology and business models to more effectively engage digital customers at every touch point in the customer experience lifecycle."
This implies that digital transformation is based on defining a technology-enabled business model that is competitive and focused on efficient digital customer interaction. In other words, what I am going to do with my company in a digital world at all levels (products, processes, services, suppliers, partners, customers ...), and of course, at the same time, generate added value for the company and its stakeholders, right from investors through to customers.
Even though digital transformation is a hackneyed topic with boundless definitions to be had, all of them clearly coincide on two key points: digital transformation is more than just a project, and it does not imply only implementing digital tools. So let’s take this over to the HR field itself.
HR as a champion for digital transformation
So based on the definition we used together with the “Whats” and “Hows” with these two key points, the HR conundrum can be disentangled by looking at it from the HR’s perspective: what must HR do to champion the digital strategy? That’s because ultimately HR’s mission is to ensure that the company has the necessary resources at the time and place it needs them to create competitive edge in the market. The difficulty isn’t so much about being innately aware of this, but more about being able to execute successfully and in a timely manner, while shouldering the emotional load involved in managing people.
Once HR recognizes what its challenges are in the new digital environment, then it is ready to drill down and tackle the next level of key problems which are best analysed by HR asking themselves the following questions:
What do we want to do and why?
Who should do it and what profile should he or she have?
Do we have this in-house or do we have to look outside? Do we have enough?
Can we prepare our employees to take this step?
Getting it right is everything
It may sound rather trite and repetitive, but it’s necessary for HR to think carefully about what they are doing about this. Is this a "digitalization" problem or is it a different kind of problem? The context is all that shifts when we pose these questions, especially as the company may need help even for defining the digital strategy, as opposed to the standard tactical practices. Actually this reality is more than familiar to many organizations.
If we assume that the digital problem matches these parameters, then our challenge is no different from the usual one. This is none other than, how to get help from HR to transform the company (at times this will be disruption). There will be resources that should no longer be used, others changed and new ones. So it will be routine “business as usual” which is about getting the right resource with the right timing.
However, the fact remains that the underlying problem or the mother of problems lies in having a clear idea in advance of "what" and to explain "why", so that we can then consider "how", since this will set the scene for everything afterwards. If we get it right, then we will be able to plan all the processes that follow on, both from the people’s point of view as well as that of HR management itself.
In a nutshell, by considering what we want to achieve and analysing the source material will help us to define our action plan for successful outcomes. Indeed, getting it right is everything.
How can the HR function be transformed and evolved?
Digital tools alone aren’t enough.
So far, HR now will know what it wants to do and the business model has defined, so at least in theory, we already have the key clues on the way forward.
Now let’s go back to the definition for digital transformation, in particular to, "... more effectively engage digital customers at every touch point in the customer experience lifecycle", and within that text, let’s swap customers for employees and for potential employees. Then it should be clear that it does not stop at implementing one or several digital tools. That won’t be enough. A successful digital transformation journey must include finding opportunities for HR in the digital world. This involves people and also calls for a new way of thinking about things. It’s not just about digitalizing what we in HR have always done.
Just one example, let's think of someone over 40 years old. He has a laptop, a desktop computer, a PSP and a Play 4, a tablet and a Smartphone. And he’s thinking about buying a smart watch. He usually buys on Amazon and other sites. He always looks around on the internet. Because of work, and not living in a big city (even though close by), he tries not to have to do face to face activities to avoid travel time, and he does everything possible to do any transactions over the internet or remotely.
He also has private emails like Gmail, accounts in Facebook, LinkedIn, Twitter, and some other social networks. He is not particularly active, but usually follows them. I think we can agree on not starting with poor candidates for transforming them digitally. A new way of thinking about things would be to pose the next question, are we from HR, providing a proper service for this scenario? Are we doing so for profiles that are even more digitalized? Are our HR processes adapted to this new environment?
Surprisingly I think the answer would be no, or not at all. We won’t be digitalized enough, if we look at things only from our point of view and not from the other side’s. And so it wouldn’t be just about internal or external HR tools, or encouraging our team on how and why these should be used. It is about the concept itself, are we able to offer our services to our employees/candidates/processes in such a way as that they become more attractive?
To put it in another way, are we in HR able to convey our digital value proposition? As in, what am I worth, for whom, and most important of all, why you should use me and how much it costs you (in this case, in terms of waiting times, ease of access, etc.). If we put ourselves on the other side, trying to access and use HR services "from the outside" we will find that often the "experience" is unfortunately not good.
Employees must see HR takes responsibility
If it’s true that we live in an era opening up to a new "talent war", we must get our employees and teams to perceive that we are working to actively "fight". Just like other areas of the company, such as marketing or sales, this happens by placing the customer right in the centre — the employee and/or candidate in our case — and by defining our value proposition based on the employee and his needs instead of HR needs.
In other words, this is about getting our employees to see that HR seriously takes responsibility for the much needed transformation and spreads it from HR to all other functions.
For example, if we ask our marketers to improve their Net Promoting Score (NPS), what are we doing or what can we do to improve the internal NPS? If sales and marketing are able to make predictions about what the consumer is going to demand, how, how much and what is going to be sold, can we profile the successful employees so we can fine-tune our recruitment processes? If we can make estimates on demand, can we from HR estimate the resourcing needs and anticipate these? No doubt there will be errors, but let’s consider from all angles, just how much more expensive it’ll be to try to solve problems, rather than foresee them. Using tools and exploiting the data we have and/or can have will be essential. This is where Big Data steps in.
Break with the past—the only way forward in digital transformation
In short, we think that the HR role in the digital transformation process is vital, so long as it is based on and aligned with the company's overall strategy, and HR recognizes the need for implementing organization-wide transformation starting with its own function. Although we live in a constantly changing world, let’s not increase uncertainty on the basis of not doing, or doing, what we always do. Remember that past business performance is no guarantee of future results. It’s time to break with the past for a complete transformation.