As businesses across the globe enter a period of unprecedented growth and transformation, experts are examining the role that human resources will play in this period, particularly as digitalisation increasingly becomes a reality. According to KPMG, most executives recognise that the workforce needs to evolve as well.
Digitalisation has made its way through every sector of nearly every economy, making operations quicker and more efficient on the one hand, but causing major disruption to a number of industries on the other. Central to the debate on digitalisation is the role of the workforce in the new paradigm.
Some have argued that automation is likely to drive out a number of jobs, making them obsolete. Others have argued that digitalisation is unlikely to threaten jobs at all. At the very least, most analysts agree that the advent of automated technology will change the nature of jobs on the market.
Last year, Big Four accounting and advisory firm EY illustrated how one in ten jobs is likely to be entirely different due to automation over the next five years, as automation and artificial intelligence create the need for a hybrid variety of jobs that entails collaboration between employees and machines.
Earlier this year, PwC published a report enumerating how the skill profile within the service sector in India is evolving rapidly and is in dire need of further evolution if the economic potential of its population is to be realised. According to KPMG, most firms recognise the need for this transformation.
A new report from KPMG has focused specifically on the human resources domain and the implications that digitalisation is likely to have on the sector. According to the firm, not only is the job profile across firms likely to change, but the HR policies must also evolve to facilitate the new job profiles.
Approximately 70% of firms, as per the report, feel that HR policies need to transform in the new paradigm, which indicates a general level of recognition. Nevertheless, the propensity to act on this knowledge remains at a different level, and some firms are reluctant to initiate any disruptive changes.
As a result, only a few firms have moved to allow the latest tools such as predictive data analytics and automation to enhance their oganisation’s HR policy, while others remain paralysed by uncertainty, which is causing them to fall behind, according to the firm.
“Those that ‘get it’ are acting decisively, viewing HR as a new value driver and turning to data, predictive insights and AI. The rest are either limiting themselves to changes that show some progress, perhaps through data and analytics initiatives, or simply clinging to a static approach that’s perilous,” says the report.
Among a number of other factors, the reluctance that remains prevalent among firms might stem from the fact that nearly 40% are doubtful about the potential impact that a change in HR policy can have on the ability of an organisation to make the most of digital advancements.
“Many businesses are exhibiting uncertainty and inertia. They apparently don’t recognize what today’s transformation trailblazers know and are clearly acting on: uncertainty in this era is today’s new normal,” says the firm, commenting on this general reluctance.