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Thursday, October 14, 2010

Is HR Department Dying?

Maybe, maybe not, but HR, the Department as we know it will cease to exist. More affordable technology, outsourcing and more HR-capable line managers will change the face of HR Department and render much of the work done by HRD redundant.

Future organizations will evolve with no or very lean HRD. Several things will factor in to that evolution.

Recruitment will be outsourced. Service providers will continue to grow their database and will become more and more efficient in serving their clients. Cost of recruitment service will become more affordable and viable option compared to having their own recruitment department. Recruitment service providers will invest in sharpening their agents' skills in sourcing and more accurate screening of candidates in order to win the competition among service providers but also to win against internal recruitment teams. They will also do this to increase profitability. Recruitment service providers will go the way of network banking. There will be "coopetion" among recruiters and this will make this industry a formidable force in the business of hiring people. Manpower augmentation companies will take care of project based and seasonal work. I'm hoping that there will be more stringent laws to protect the underprivileged and marginalized workers because the IT, engineering, finance and call center professionals can very well take care of themselves.

Most of HR transactional activities will be outsourced, automated or relegated. Time keeping and benefits administration will be outsourced, performance management will be automated and will become more effective and efficient. Whatever is left will be relegated to another department, maybe admin or finance.

Managers will take matters into their own hands as far as people development is concerned. It has already began. On several occasions, line managers have contacted me about their training needs. When I ask why they are the ones inquiring instead of HR or training department, they either say they don't have one or they don't trust that HR can do a decent job at it.  Management training itself is going to change. It will give more and more time and attention to people management. Managers will appreciate this part of their job better. The more that they do, the more that they will feel some discomfort with HR specially if HR fails to cope with the changes going on in the organization.

Training itself or to better describe it, acquisition of knowledge and skills will change dramatically specially with the entrance of the millennials in the workforce. Knowledge workers will choose to Google, to learn new things or watch a how-to video in youtube. Resource persons will tap new media to convey their messages in order to earn new business or to earn from traffic. I doubt if facilitator-led training will disappear but it will diminish greatly in the future. Blended, self-paced and action learning will be the wave of the future. In the battle of survival of the fittest, only the best training professionals will remain.

What will happen to HR the profession? If HR plays its card right, it will become leaner but will also climb higher in the organization. Chief HR, or SVP HR will become as common place as CFO's. For large organizations, senior HR executives will be supported by HR Managers who may have no to very few contingents. They will play the role of internal consultants, the best value that HR professionals can contribute to their organizations. In some smaller companies, the head of operations will take over this role, Hence, there will be no HRD. HR professionals who want to stay doing tactical or transactional work will find themselves working in outsourcing agencies. Specialists will do consulting in their areas of expertise, mostly as members of consulting organizations or as freelancers. Companies will begin to see the benefit of entrusting their training funds to these consulting organizations because of their ability to broker better deals for them and their ability to distinguish between good resource persons and run-of-the-mill trainers.

HR-related careers will concentrate in the following areas:
  • Recruitment - Sourcing, screening and onboarding
  • Training - This will be inhabited by professionals from various walks of life. HR Professionals will just be among the many people who are going to conduct training.
  • Generalists/Specialists  - Will act as internal (or external) consultants and will need to position themselves strategically in the organization if they are to make meaningful contribution in the company.
In the near future we will find more HR professionals working in HR process outsourcing and consulting companies. The young ones will focus on very narrow specializations while the more mature ones need to equip themselves to be useful strategic partners to line managers who have better appreciation of people management.

This is a forecast, we don't really know for sure as to which direction the wind of change will blow but it would be pretty interesting how HR professionals or budding professionals will take all these. There are only two ways to respond to possibilities of change; to dismiss it or to prepare for it. To prepare for it, HR professionals need to acquire better conceptual skills. They need to be more strategic. They need to learn how to be effective consultants as well as how to be consultative. They need to gain the trust and respect of the organization. They need to build their reputation around giving solutions that truly respond to the need of the organization. They need to veer away from measuring their contribution in terms of  "done-not-done" and start ensuring the positive organizational impact of what they do. HR needs to stop being order takers and start becoming HR Leaders.

1 comment:

  1. Anonymous11:11 PM

    I concur with this accurate forecast. Being a person who has served in many HR departments, I have witnessed the members sitting in their offices with the door closed in hopes no one asks a question that they can't answer. Or being the last one to know about a new hire.

    For the companies who currently use and view HR as a glorified administrative function; those companies will eventually outsource the function completely, because the position is no longer justified.

    However, the organizations who allow their HR department to contribute and focus on the organizations success as a whole; they will continue to utilize their HR department to the fullest and allow their team members to educate themselves and grow with the company.

    Thanks for sharing.


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