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A giant leap towards CHRO 3.0

Comprising seven transformational shifts, find out how HR leaders can evoke the most important ingredients for tomorrow’s business success.

The past two or three years have seen the breakneck speed of change in both the internal and external environment of organisations.

No matter which industry one looks at – HR solutions, advertising and PR, healthcare, IT and ITeS, manufacturing, construction, services or the financial sector – each one has been impacted by substantial changes in the form of changing expectations of stakeholders, realignment of business models, and newer forms of competition.

You would be hard pressed nowadays to find a senior executive who isn’t spending sleepless nights worrying about human capital. Developing human capital as well as developing leaders who can lead into the future, almost always shows up in the top three priorities for most CEOs.

Against this backdrop, the role of the chief human resources officer (CHRO), or the HR director, has never been more prominently in focus. Through policies and systems, the CHRO can evoke the most important ingredients that employees need for business success – passion, ownership, accountability, and most importantly, engagement.

The urgency for HR directors to join in the business conversation, and stand out for their contribution to developing future leaders is one of the biggest drivers behind this special edition toolkit, spearheaded by the Center for Creative Leadership (CCL).

The CCL team reached out to senior HR professionals across Asia in 2016 to identify how HR can deal with the changing environment, and stay relevant in the future. The study identified mindset shifts, skill set shifts, and tool set or experience shifts that senior leaders and the function must undertake over the next decade. Senior HR leaders, in fact, pointed out that incumbents must prioritise mindset shifts over skill set shifts. This is quite in contrast to what most organisations are doing to prepare the workforce of the future.

The seven shifts for Asian HR leaders

To prepare themselves for the future, Asian HR leaders will need to make serious efforts to upgrade their capabilities and change their perspectives across seven key areas, as identified through CCL’s interviews with 21 heads of HR working for Western and Asian MNCs.

Shift 1: From technology shy to technology savvy

In the words of a survey respondent, HR was never best friends with technology, and the head of the function is rarely viewed as the most technology savvy executive.

But what does the tech-savvy executive look like? Awareness of technological innovations in HR; leading the adoption of technology in the enterprise; and the ability to negotiate internally with boards, CEOs, and global HQ for budgets – these are some of the ways that HR can overcome its image of being the hesitant or slow adopter of technology.

Shift 2: From metrics to insights

Data suggests that only 5% of heads of HR feel they are effective in using talent analytics, with unclean data, lack of in-depth understanding of analytics, and nonavailability of analysts within HR, to blame.

But data and analytics are not the only things in demand. “We don’t need to become analysts,” clarified an HR leader. “Instead, we need to understand the insights our data can give, and perhaps learn to ask the right questions of data analysts,” she added.

This boils down to a move away from standalone indicators such as engagement scores to predictive indicators such as information around which a salesperson is most likely to succeed. Organisations also need HR to link multiple sources of data, such as engagement scores with sales numbers, to come up with a holistic strategy.

Shift 3: From chief HR (process) officers to chief employee experience officers

CEOs are increasingly expecting heads of HR to craft their role with the employee in the centre. CHROs can take a lesson or two here from the customer experience executives, who ensure a seamless experience to customers while managing all the back end dynamics.

“My role is people experience director; we call it ‘people experience’ because that’s our job in HR – to deliver superior employee or internal customer experiences,” explained an HR leader in an APAC-based MNC that has made a switch to its HR being called an “employee experience” function.

The job description of a chief employee experience officer requires the incumbent to not just champion processes, but own the complete employee life cycle. Throw the rule book-centric mentality, and replace it with a user-centric experience for today’s Millennials!

Evidently, HR heads will need to get better at having uncomfortable conversations with business leaders in order to push back taking on responsibilities that may not add a lot of value.

Shift 4: From doing-all to doing-what-matters-most

Is HR the right owner for payroll? “Payroll belongs under finance with maybe a dotted-line reporting structure to HR because of the nature of their work.”

How about the diversity agenda? “Employment law prohibits diversity mandates in hiring and promotion practices, so companies try to change line managers’ attitudes and priorities instead. But such efforts are effective only if top executives lead them, transforming the culture.”

Views from the respondents prove that some of the activities traditionally falling under HR’s ambit may not be yielding the kind of returns they demand in terms of time, effort and investment.

Evidently, HR heads will need to get better at having uncomfortable conversations with business leaders in order to push back taking on responsibilities that may not add a lot of value, or that may be best housed elsewhere in the organisation, or even outsourced.

HR leaders may need to apply the responsibility-authority lens to key activities, taking on new assignments only if they have the complete or at least well-defined ownership to execute, and authority to make necessary changes to fulfil the responsibility.

Another implication is for HR leaders to get better at identifying and measuring value created through talent interventions. This ability will enable heads of HR to negotiate better with business as they prioritise interventions and initiatives to go after from a talent standpoint.

Shift 5: From inside-out to outside-in

Thinking outside the box takes on a new meaning for the future CHRO, where the requirement has moved from knowing your organisation well based on years of tenure, to looking over the fence to see the outside world and bringing in the best from competitors, consultants, and vendors.

CHROs will hence need to replace years of experience with multi-country and multi-industry experience; internal networks and stakeholders, with an external pool of allies; and most of all, replacing the question, “Why it will not work in my company” with “How can I adapt it to make it work in my company.”

Shift 6: From rule enforcers to equal partners

How many times do you catch your team saying – “you cannot take more than 20 days off”, “you cannot delay performance reviews” or “you cannot not put the annual goals in the system”? Long known as the company policeman, the HR function needs to “stop talking about HR and start talking about business” in the words of a head of talent.

Automation of HR is contributing to ending HR’s rule book regime. As the selfservice delivery model becomes the norm, rules enforcement will happen online, and HR will not need to play the “bad cop.”

Not only does this save HR a lot of time, it can instead focus its energy on other value-adding activities, such as execution of strategic interventions in both the business and talent domains.

Shift 7: From helpers to doctors

Just owning annual talent interventions will no longer be enough for CHRO 3.0. The HR leader of the future must play a more proactive role by adopting a more strategic approach – just as a doctor who not only offers a diagnosis, but also advice on prevention. This will entail HR owning critical initiatives such as internal consultant, leadership developer, change agent, and even part business leader role in some cases.

Just as the seven geometrical circles in the seed of life depict the seven days of creation, these seven shifts are geared to make a monumental impact to the life of the HR director, today and in the future.

Reference / CHRO 3.0: Preparing to lead the future HR function in Asia, by Sunil Puri and N. Anand Chandrasekar. The Center for Creative Leadership in partnership with Singapore Human Resources Institute.

[READ MORE] Future-ready toolkit: CHRO 3.0 Brought to you by Center for Creative Leadership and Human Resources

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