HR leaders are starting to gain a greater responsibility of the strategic development in their organizations. However, HR departments are often constrained by a heavy manual administrative burden despite great possibilities of digitization and automation. Therefore, Knowit Insight present the capability mapping methodology as a first step in sorting out how you can lead your HR department into the future.
The traditional operating model of HR is developed for traditional hierarchical organizational structures and was developed to solve problems existing 20 years ago. However, the problems of today look very different and therefore need a different HR approach. Based on our experience, HR leaders being part of the management group is becoming more common. Yet, the change in the role of HR is still slow and many organizations are stuck in traditional perceptions of the function. When the vision and objectives of organizations change, so must HR.
When Gartner asked HR leaders about their top business objectives for 2019, the answers were business growth, operational excellence, business transformation, innovation and cost reduction. Four themes can be identified in these objectives: talent acquisition and retention, learning and development, digitization, and transformation.
- Talent acquisition and retention are cornerstones of an organization, which has evolved heavily over the past years on a currently hot labor market. HR must put effort in boosting the employer brand, as well as the employee experience.
- Learning and development is key in having the right competencies in the future and support the organizational growth plan. Due to digital disruption and organizational changes new skills are required, which calls for employees to stay ahead.
- Digitization is a requirement for the whole organization and HR is not an exception. There is pressure on HR to deliver more time efficient and accurate services, as well as HR data, which demands better technological solutions.
- Transformation should include HR as a natural partner in transformation management throughout the organization. From our experience, the degree of acceptance and probability of a successful transformation process is often tightly linked to organizational culture. Therefore, HR can help in aligning the transformation strategy to the culture, or if needed, vice versa.
Accomplishing these initiatives requires a strong, contemporary HR department, working as a strategic partner in business development. Unfortunately, this is not always the case. According to our experience, HR is often constrained by a heavy administrative burden despite several great options for HR systems and HR processes often being perfect for Robotic Process Automation (RPA) implementation. If HR must spend all their time on endless manual administration, they will not be able to solve the employee related problems of the future.
To lead your HR department away from being an administrative function towards focusing on more strategically important initiatives, as those listed above, a first step is a capability mapping. It is used to distinguish how well HR capabilities work, as well as how HR can help the organization to reach their objectives and vision. So how is this done?
Firstly, a map of all HR capabilities is constructed, a composition of everything HR does and should do. The map is derived from industry best practice and customized for the specific organization. Based on the map, a prioritization of the capabilities is done in accordance to the organizational objectives and vision. Not only does this show which areas within HR are most urgent to focus on, it also shows how the rest of the organization depends on HR in strategic decisions.
Secondly, a gap analysis is performed in each capability to establish which of them are working well and which need scrutiny. Data is collected from appropriate stakeholders through interviews, surveys and workshops. The data is analyzed based on the aspects of people, processes and technology in order to illustrate an exhaustive image of the HR department. The result can be roles or responsibilities that are missing or overlapping, IT systems or tools that are not functioning satisfactory or are missing completely, or processes that are overly time consuming.
Finally, a set of change initiatives are proposed with a recommended order of prioritization. These initiatives are based on the organizational objectives and vision, industry trends and tendencies, as well as the specific HR department’s capacity regarding resources.
When working with HR departments, we often observe two issues. The first issue is a lack of communication across the organization. Too often decisions are made without knowing which parallel initiatives are planned for or ongoing, thereby resulting in costly and inefficient IT investments. The capability mapping of HR is an exercise uniting different departments and functions throughout the organization. HR, IT, payroll, finance and business representatives are most often participants of the project. The activities spark cross functional cooperation in shaping the HR department, and the capability map can function as a common ground in discussions between HR, IT and the rest of the organization to gain consensus in which areas are underinvested and what would be the best way forward, leading to more successful IT investments.
The second most common issue we encounter is a reduced knowledge within the HR department on how digitization and automation can be used to elevate the HR function. Therefore, the capability map is made to visually illustrate the condition of each capability in an easy and straightforward way. When it is laid out in front of you, it is easier to recognize how investments in IT can enhance certain areas and capabilities, complementing HR representatives and giving them more time for value creating tasks.
Thus, as a HR leader who wants to transform your HR department and shift your attention from administrative tasks to initiatives with strategical importance, a capability mapping is a great kick-start. A full overview of the condition of your department, cross functional cooperation, and a set of initiatives and prioritizations, all to give the best pre-conditions for your HR department’s transformation.