Ask ten HR Directors and you’ll get ten wildly different answers. The question, of course, is what is human capital management (HCM)? The least controversial and most encompassing answer I’ve had is, “HCM is the attraction, selection, retention, development, utilisation, management, and separation of people, in order to achieve both organisational and personal objectives.”
Note the inclusion of organisational AND personal objectives. This enormously powerful definition encompasses the complete employee lifecycle within an organisation while recognising the symbiotic relationship between employer and employee.
This acts as our ‘true north’, enabling us to map what is often a minefield of stakeholders (legislative, management, employees, shareholders) into a complete value chain. Our purpose is to maximise shareholder value by aligning the needs of the organisation with those of the employee. Often when we see tension within an organisation impacting the bottom line, it’s because there is a disconnect between these two forces.
Out with the old
With technology influencing how we do business, is it any wonder that it has made its way to how HCM operates?
From roughly 2010 onwards, the world of HCM altered and it was due to the advent of technology. Well, this wave of advancement gave rise to three major events which brought about major changes to HCM.
The first event was when social became the norm. With IT barriers to entry broken down, a programming degree is no longer needed to communicate thoughts and people became used to collaboration.
The second event included intelligence becoming the goal. Users understood that they could aggregate data to make sense of the world in a greater context.
Lastly, the Cloud became the vehicle. New technologies became available to the layman, making many necessary functions cheaper, faster, and easier.
Slowly but surely HCM communities are evolving and using new approaches made possible by technology. Many, though, are stuck on old paradigms, where customers focused on meeting organisational objectives, but not the personal objectives.
While the old systems allowed us to increase efficiency and create a consolidated view of the world, they didn’t and don’t do a great job with the personal objectives and there is still more work to be done on meeting organisational objectives.
In with the new
The pace at which HCM communities choose to adopt the new paradigms is up to them, but technology often moves faster than adoption and to my mind there is an opportunity here, which isn’t being realised fast enough.
Here are four themes that HR Directors should focus on:
1. Operational Excellence across all of HCM.
The oldest theme, sure, but it’s amazing how there are always new efficiencies to be created. Operational excellence in itself is not the end-game, however, you need to use these gains to finance more strategic themes.
2. Predictive Analytics and Intelligence.
This is the most efficient way to gain insight into your business and create quantum leap efficiencies.
For example, using predictive analytics and intelligence, we’ve quantitatively proven that certain universities provide better employees. However, having then analysed talent all through the value chain and considering items like performance, progression, employee relations, absenteeism, and separation, we can demonstrate those universities considered “premium” didn’t offer the best candidates.
Just this insight can change recruiting practice and offer amazing returns.
3. Social solutions.
This theme is the biggest challenge for most HR Directors. Next generation (well, actually, ‘Now Gen’) software allows for Social Recruiting, Social Learning, and Social Performance Management all of which are game changing elements.
The result of social solutions is that employees and employers will be in a position to receive and actualise solutions in a social, collaborative manner.
4. Alignment of HCM to the broader enterprise.
This involves two main areas. The first is aligning recruitment, selection development, and management more closely with organisational and personal goals. The second is that the broader goal of using BI to work not only within HCM, but within the enterprise is required.
An example of this would be a retail environment, where management understands foot traffic in the store and with this in mind, hires, develops, and performance manages staff to increase revenue.
Allowing technology to take us further
To ensure that HCM evolves and as a result allow organisations to benefit holistically from their HR approaches, HR Directors should focus on four main technology tools.
The first of these is to look at your existing solutions. It may not be necessary to implement a new strategy, when in fact, you simply need to tweak and augment your existing software investments.
The second technology tool is the Cloud. Don’t underestimate the Cloud. Cloud solutions offer enormous cost savings, new thinking, social components, and are highly agile.
The third technology tool is wrapped up in mobile. Mobility solutions increase interaction and free up employees to engage when they want to.
Lastly, we must focus on the Internet of Things. This is one of the massively exciting aspects of this evolutionary journey. We’re able to take information from the workplace, digitise it, and then correlate it with the people who are executing on the ground.
The possibilities here are endless and will ultimately become pervasive.