Will the HR Function Survive Enterprise 2.0? 1

HR

What will HR look like in the future?  If recent articles online are to be believed then the HR function will be more powerful and more important than ever.  We do know the following:

  • We do know that the standard job market will become more fragmented as better information management allows much work as we know it to become commoditised.
  • We do know that in a world where executive education is highly specialised and more competitive the acquisition of top talent will become more difficult as senior executives look for a richer, more cross-functional, more multi-disciplinary skillsets in their stars.
  • We do know that top execs will add complexity to HR through cross-functional skillsets (i.e. top talent will be less obvious because they will not necessarily rise in vertical portfolios.  The best project manager may also be a registered psychologist, for instance).

What we do not know is just how the enterprise will react.  The onset of better databasing technologies and mobile methods of capture did not ease the information management problem in organisations (rather it has just created mountains of unmanageable data).

  • So, will the  fragmentation of the labour market and the rise of cross-functional skill sets add too much complexity?  Will the HR market be able to cope?
  • Will the HR function reach an inflection point where complexity is too great and the entire function is outsourced completely? Or,
  • will better information management allow line managers to integrate talent sourcing directly into operational business processes?

Future of HR.ChartIf a  recent (27 Sep 2012) survey by KPMG is an indicator then cost pressures in businesses mean that they will have to get smarter about HR if they are to remain competitive.  In boom times even with 35% of respondents arguing for greater direct collaboration with operational management, it is unlikely that even this volume of vociferous response would change the HR paradigm.  However, with the cost pressures at almost unbearable levels and social media increasing the transparency and speed of operations, it is unlikely that the HR function will survive even as it stands today.

The following outcomes are likeley: (i) Commoditised work will be consumed by line management into standard operations, and (ii) top, cross-functional talent will be outsourced to ever more high-end boutique HR consultancies.  Smaller HR firms will fall by the wayside but the high-end firms will demand higher margins and their clients will demand greater results.  It is possible that, much like IT services of the ’90s boutique HR consultancies could take stakes in realised profit that certain new-hires make.

Whatever the answer is it will be global and there will be big money in it.

One comment

  1. Pingback: Is it really OK to bash HR? « The Citadel Project

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s