The HR technology market is heating up. AI, automation and analytics are transforming how we work. We explore the key trends in HR transformation in 2019.
The global HR technology space is booming and according to recent research, the global HR tech market is poised to reach $30 billion by 2025. The rapid expansion of the HR technology market has been fueled in part by massive spending on HR technology solutions and in part by the data explosion in HR. The move from legacy systems to cloud-based Software-as-a-Service (SaaS) model has helped organizations not only record and store but also consolidate and centralize all HR data.
As the HR function inches closer to becoming a true strategic business partner, the focus of people management has shifted from mere engagement to productivity. While employee engagement and experience are still as important to the HR function, they are still a means to an end, with the end being business performance and productivity.
So, with 2019 well underway, what are the key trends, challenges, and opportunities that you need to look out for? Let’s find out.
HR Transformation in 2019 – Key Trends, Challenges, and Opportunities:
- Creating a Culture of Continuous Engagement: Call it the perils of a stable economy – the labor market is incredibly tight, the stock market is in great shape, and commodity prices have stabilized after steep falls between 2013 and 2015. In an economic environment like this, keeping your employees focused and motivated is a Herculean task. Increasing costs of healthcare, education, and real-estate make employees feel like they are constantly playing catch-up. In fact, research shows that this mindset has trickled down into younger generations in the workforce with Gen Z citing “financial security” as their top concern when it comes to choosing a job.
The need for continuous employee engagement has never been greater. While organizations now have a host of technologies and tools at their disposal to monitor and improve the employee experience at every stage of the employee lifecycle, continuous engagement is as much of a technological issue as it is cultural. Speaking about the biggest mistakes organizations make when executing an employee engagement strategy, Zack Dugow, CEO and Founder at Insticator, says, “My belief, and one of Insticator’s core values, is that all companies need to work smarter and harder together in order to be successful. One big mistake that companies make is they list out all of these great core values, but they don’t actually live by them. If you don’t live by your core values, then your team and new hires won’t take them seriously. Companies should also make sure that their performance review ratings include evaluating everyone on how they stack up with your core values. If something isn’t a core value (don’t make them too aspirational, make them closer to reality) then don’t list it as a core value. That means we all get our hands dirty every day, no matter the level or role, and it feels good. As a CEO, I am still involved in the day-to-day duties with my clients, while looping in the rest of the staff on strategy and the big picture. The biggest mistake for organizations is when not all team members are involved or when there’s a closed-door policy. Why would an employee feel comfortable in the company if they’re siloed? In order to empower a team and ensure all employees feel special, there must be a sleeve up approach. One that puts the employees first.
“Another mistake is when organizations are not transparent with employees. There needs to be more transparency and more leaders being vocally self-critical. If your vocally self-critical you build a safe environment for your team to admit when they make mistakes and discuss what they learned instead of hiding their mistakes. After all, we grow and fail as a team. To improve employee experience, companies must communicate openly and honestly. Focus on whether the feedback is true, not whether it’s ‘good’ or ‘bad.’ You should want your employee to succeed and enjoy work, and thus, we must be transparent always.”
- Artificial Intelligence (AI) in the Flow of Work: Artificial intelligence (AI) in HR is perhaps the biggest drivers of HR transformation in 2019. AI has the potential to reimagine HR processes and talent management entirely, however, the real value of AI in the workplace is its ability to help improve employee productivity. Chatbots, predictive analytics, and automation have helped early adopters of the technology, scale productivity and improve the quality of work. Sure, we’ve not perfected AI yet, concerns around the ethics of AI deployment within organizations still remain. However, vendors are increasingly taking cognizance of this fact with some even establishing inhouse AI advisory councils. On the HR front, AI helps recruiters and HR professionals save valuable time by automating high-volume repetitive tasks like resume parsing, talent sourcing, candidate engagement, and assessment. For, employees, AI works in the background, answering their questions, helping them choose their career paths, serving personalized recommendations, or monitoring their health. There is little doubt that AI coupled with HR analytics represents the most significant opportunity in HR transformation. As some experts put it: AI could help us make the quantum leap in productivity.
- Data Integrity and Quality: Data is the foundation for technologies like artificial intelligence and predictive analytics and HR teams that embrace the power of data can easily make measurable, transparent, and comprehensive recommendations and decisions. However, data integrity and quality are essential to making the right decisions. In 2019, HR leaders and vendors will need to take a hard look at the data being fed into smart systems and algorithms to weed out animalities and bias if any. In most cases, HR relies on data that is not continuously cleaned or monitored for inconsistency. While SaaS solutions have certainly improved the quality of data, there are still masses of records that get typed in manually at some point in the process. Administrative errors such as double invoicing or payroll errors can cost a lot of money to organizations. Apart from flawed decisions, erroneous HR data can also have substantial financial costs. HR data integrity and quality will continue to be under scrutiny as we increase our dependence on AI, machine learning, and deep learning.
Productivity, AI, and, data integrity will become key considerations for HR leaders looking to win in the age of disruption. While these points listed above are not exhaustive by any measure, they are indicative of the profound transformation underway in HR. 2019 will be an exciting year in the world of HR innovation as more HR leaders and vendors push the envelope to deliver greater value.
What HR transformation trends are you tracking? Let us know on LinkedIn, Facebook, or Twitter. We’re always listening.