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Only 5% of companies rate HR performance as excellent

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The HR function today is in need of massive reskilling as it significantly lacks the right capabilities to meet business needs.

Deloitte’s third annual “Global Human Capital Trends 2015: Leading in the New World of Work” reported HR’s performance as a function has shown no signs of improvement since last year.

Polling more than 3,300 HR and business leaders in 106 countries, the report highlighted only 5% of respondents rated their organisation’s HR function as “excellent” – the same percentage as last year.

In addition, just one in three (30%) business leaders believed HR has a reputation for sound business decisions, while only 28% felt that HR is highly efficient.

Slightly more than one in five (22% of respondents) believed HR is adapting to the changing needs of their workforce, and a similar number (20%) feel that HR can adequately plan for the company’s future talent needs.

“To put it bluntly, HR is not keeping up with the pace of change in business,” the report stated.

ALSO READ: What HR challenge keeps you awake at night?

The capability gap of HR leaders, in terms of what business leaders want, across Asia was found to be -30. In Southeast Asia, that gap increased to -38.

Only a handful of HR leaders and business leaders also thought their organisation’s HR was excellent at “holding HR accountable for providing innovative solutions and programmes” (10%), “preparing HR staff to deliver programmes aligned with business needs” (12%) and “providing HR staff with appropriate training and experiences” (11%).

“Perhaps because of these dim views of HR’s performance, we found an increasing trend of CEOs bringing in non-HR professionals to fill the role of CHRO,” the report stated.

The biggest challenge facing the HR function today is engaging employees, listed by 87% of HR and business leaders, an increase from 79% in 2014.

More than half (60%) of respondents admitted to not having adequate programmes to measure and improve engagement, indicative of a “lack of preparedness for addressing the issue”.

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