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|Posted: Wed Jan 16, 2013 12:42 PM
Tue Jun 07, 2011
|HR, Leadership, Technology, and Talent Management Predictions for 2013
Josh Bersin, Contributor
Prediction 1: Flatter organizations and focus on agility will change HR practices.
In 2013 more and more companies will see the value of what we call “agile management” and “agile HR.” Organizations now operate as flattened, cross-functional teams, creating demand for less top-down HR and management styles.
This is forcing changes in performance and goal management, performance management, reward strategies, and leadership skills. Our research shows that companies which revisit goals for employees quarterly, for example, outperform those which set goals annually by more than 30%.
High performing managers play a hands-on role, redefining the role of leadership. Witness the growth of cloud-based technology and service companies which are rapidly disrupting more traditional organizations. These fast-movers focus heavily on decentralized, hands-on, technical leadership.
Prediction 2: HR Transformation projects will accelerate.
Many companies we talk with want to “transform HR.” It’s high time. The HR organization of the past is dying away, being replaced by a team of highly skilled and specialized professionals. Just as sales, marketing, manufacturing, and finance professionals have become highly specialized, so will HR. And cloud-based systems will finally make integrated HR technology to many organizations.
Developing a global HR service delivery model is also a big topic this year. We predict a new model of HR will emerge, one which focuses on global delivery of core services, talent services, as well as what we call “strategic enablement” services. And technology will play a much larger role. (Look at the rapid growth in HR technology companies.)
Prediction 3: Global leadership and bench-strength will be a high priority.
Of all the programs HR executives want to improve, our research shows that global leadership is #1. And our research also shows that companies with mature leadership development strategies dramatically outperform their peers. If there’s anything you should invest in this year, it’s revamping and expanding your global leadership development program. More details in the predictions report.
Prediction 4: Globalization of HR and talent practices will be a major focus.
Many HR programs are developed at a corporate location and then “rolled out” to the business. Unfortunately this often doesn’t work. The way people need to be sourced, managed, compensated, and evaluated varies by geography. Why? There are workforce dynamic differences (some countries have huge labor shortages), cultural differences (some countries require individual motivation, others thrive on group motivation), and skills differences.
In 2013 organizations should learn how to “globally localize” all strategic HR programs. This means shifting authority toward the business and improving local HR skills (more on this below).
Prediction 5: Capability development and continuous learning will begin to replace the focus on “informal learning.”
The L&D industry has gone through a renaissance over the last few years as companies have focused efforts on what we call “informal learning.” It’s time to consider throwing that phrase away and rather focus on “continuous capability development.”
In 2013 we see organizations focused on on-demand training, coaching, simulations, and management-led on the job programs. Spending on corporate training is up (12% last year), and more than 60% of all L&D spending is now spent on “non-classroom” content and programs. The world of blended learning has become very real and this year companies need to focus on their learning architecture, standardizing technology platforms, and developing the skills to build game and simulation-based programs.
Prediction 6: Specialization and career development will emerge as a key talent strategy.
Jobs have become highly specialized (Read “”The End of a Job as We Know It for more detail.). As a result, the need to develop deep skills has increased. So if you want to build a high-performing company, you should let people specialize and put in place programs which facilitate in-place promotion and developmental job rotation. We need fewer managers and more “doers” these days, and that means we must focus on skills ladders, professional career programs, and formalized career development programs.
Deloitte’s Mass Career Customization describes the new world of careers. Organizations must develop a career “lattice” not only a “ladder,” enabling employees to move horizontally, and sometimes out of the workforce (temporarily) to continuously improve engagement, retention, and performance.
(Much of this was in place when I entered the workforce in 1978 and it’s now coming back.)
Prediction 7: Facilitated talent mobility will become an important initiative.
We’ve entered a workforce that needs to, and wants to, move around. Rather than let people “manage their own careers,” we should provide internal opportunities. Employees today have lower levels of engagement than ever before, which means they may leave your company if they don’t find rewarding work.
The new buzzword is “facilitated talent mobility.” Don’t leave it up to employees to figure out where to go next, build a talent mobility strategy that lets your high-performers find the “right job” for them and for you.
(How do you actually pull this off? A large global healthcare provider assigned one of their top staff leaders to run the internal talent mobility program. Over the last year she has created a series of programs to %*$ess internal candidates, identify their “best next move,” and help leaders both “produce talent” and “recruit talent” internally.
In a sense, the talent mobility strategy is a microcosm of your external talent acquisition process – this is why it belongs integrated with the talent team, not only focused on leadership and upward mobility.)
Prediction 8: Talent Management software will start to commoditize and HRMS replacement will accelerate
The $4 Billion+ market for talent management software (applicant tracking, performance management, succession, learning, compensation) has somewhat consolidated, giving customers a more integrated set of solutions.
In 2012 we saw all the major ERP vendors gobble up talent management providers. These transactions were driven by buyer demand for integrated end-to-end talent and HR systems, and this trend should accelerate.
New research we will soon publish shows that the average age of a core HR system is nearly 7 years old. It’s time to replace these things, and 2013 will begin a cycle of accelerating growth in core system replacement. HR software vendors with cloud-based integrated HRMS tools and payroll offerings will benefit.
Despite the vendor consolidation , a great deal of innovation is taking place. A flurry of new candidate relationship management, social sourcing, social learning, and employee %*$essment platforms are being launched. Venture capital firms see the opportunity and are heavily investing in these new markets.
(Your ability to locate, source, attract, and recruit the right talent will differentiate your company in 2013. If your talent acquisition team is not using modern social tools to attract candidates, your recruitment spend may have to be 2-3X that of your competitors.
Added to this is the fact that employment brand, once a small idea, has now become ubiquitous Thanks to tools like Facebook and Glassdoor, your entire brand represents your employment brand – so in 2013 you should make sure your employment brand and corporate marketing teams are well connected.)
Prediction 9: Many HR analytics, BigData, and workforce planning tools will emerge.
Easy to use HR software for analytics and workforce planning has been hard to find. Today these tools are getting a lot of focus, so in 2013 we will likely see more and more HR analytics solutions come to market. We are focused heavily in this area ourselves, investing in our benchmarking data to help companies leverage BigData in their HR strategies.
The challenge in HR analytics continues to be capabilities and experience. It will take years for HR organizations to evolve their analytics strategies. While tools are important, in 2013 companies will continue to build internal skills, hire consultants, and stitch together systems to improve their HR analytics solutions.
(A large financial services provider analyzed its sales team and found that many of their “belief systems” were wrong. The high performers had very different characteristics than they believed. This analysis was used to change the screening and recruiting process, and generated over $4M in sales improvement the following year. Read
“Applying BigData to the Science of Management” for more.)
Prediction 10: Mobile HR tools will become critical
I moderated a panel of 200 HR professionals at the HR Technology Conference this year and every single person I spoke with told me their workforce wanted mobile HR tools. These are simple applications: expense reporting, time and attendance, training, employee directory, etc. The HR software market is catching up to this demand and by the end of 2013 we will likely see many new fantastic mobile HR tools in the market.
When we ask organizations why they want to replace their HR systems, the #1 issue they cite is “poor user interface.” We have all tried to deal with awkward HR systems over the years. Putting this functionality into a mobile app is one way to solve this problem.
Prediction 11: Social tools will begin to change HR practices
There are some important and innovative social HR tools which are changing the way HR works. These include social rewards systems, social performance systems, social sourcing systems, and social learning environments.
These new tools implement people practices differently: they leverage the “wisdom of crowds” rather than the “wisdom of the manager.”
Just as we now see the wisdom of crowds change the way marketing decisions take place, the same shift is happening in talent management. If you found out that 80% of your employees saw great value from a lower level employee, wouldn’t you want to promote her? Even if her manager didn’t notice? These new tools unlock this valuable source of management insights.
Prediction 12: Engagement and Diversity will enter the world of Talent Management
Several years ago a large consumer goods company asked me if “diversity” was part of talent management. I had to scratch my head. Well yes, it is. Today the workforce is highly diverse (gender, age, ethnicity, religion, physical ability, intellectual ability, learning style, etc.) and research shows that diverse teams outperform non-diverse teams. Plus most companies are recruiting in a diverse labor pool. So diversity is no longer a compliance program, it’s a talent management strategy.
As far as engagement goes, research shows that employees are pretty burned out right now. They’ve been working hard and receiving less pay in the last five years, leading to the lowest general engagement scores in a decade. And thanks to the open world of social networks, unhappy employees can tell people about their unhappiness very quickly. So if you dont have a program to measure, monitor, and improve engagement you should develop one.
Prediction 13: Structure of HR and Role of Business Partners will change.
We believe that the traditional model of “HR Generalist” is dying (and for good reason). Companies don’t want HR administrators any more, they need specialists. This means the general structure of HR is changing, and we are doing away with HR “service centers” and replacing them with true “centers of excellence” or “leading-practice groups.” This is a major focus of our research this year.
And by the way, the growth in HR analytics will start to deliver more tools into the hands of line managers, again making HR think differently.
Prediction 14: Reskilling of HR is a top need.
CHROs, CLOs, and Talent Management executives tell us that one of their biggest challenge is the skills of their own teams. If you don’t have a continuous career development program for you HR team, you should build one. This marketplace and the world of talent management is changing fast. The HR team wants to keep up, so organizations need to invest in their skills.
Prediction 15: 2013 is the year of the “Bold CHRO”
We are going to launch a series of research studies on what it means to be a “Bold CHRO.” What our research shows is that companies who win in this skills-constrained talent environment have forward thinking, innovative HR leaders. 2013 is the time to be “bold” and take some risks. People management is changing, and so should HR and L&D.
Well that’s a very quick summary. If you’d like to learn more, read our predictions report. I look forward to your comments and feedback.
You can follow Josh Bersin to stay up to date on trends, research, and news in all areas of HR, leadership, and talent management on twitter at @josh_bersin.