Posted on: October 2017 Lara Edgcombe
2016 has proven to be an unpredictable year by all accounts. But, it is in times of great change and uncertainty that companies need a strong HR and Talent team to guide a business smoothly into the next phase of development.
Peter Cheese, Chief Executive at the Chartered Institute of Personnel Development (CIPD), proposes that this uncertainty provides the perfect climate for the HR function to evolve: “Only by engaging with these issues head on, in a local, national as well as international context, can we build resilient and flexible workforces and organisations that will define what the future of work looks like.”
"Only by engaging with these issues head on...can we build resilient and flexible workforces."
What is HR transformation?
Change is not an easy transition for any team, and it can be especially hard for HR teams to adapt their strategy and structure, whilst still meeting the needs and demands of a growing business.
The term ‘HR transformation’ refers to implementing business changes that align HR strategy with commercial goals. The aim is to strategically transform a company’s mindset so that the business as a whole delivers HR services, ultimately increasing efficiency.
Transformation in business is about creating a system that is consciously versatile – taking active steps to make the business more agile and efficient in every situation. Rather than HR solely focusing on functional services such as recruitment, transformation is about shifting the team’s responsibility to nurture values that promote productivity across the board.
"'HR Transformation' refers to implementing business changes that align HR strategy with commerical goals."
Why do companies need to change?
Companies face a constantly changing environment and need to adapt with the times, reinventing themselves and what they offer in order to meet the challenges of a modern marketplace head-on.
"HR leaders are essential when it comes to nurturing the skills of key members of staff..."
HR leaders are essential when it comes to nurturing the skills of key members of staff, finding talented workers, helping support a more agile workplace, as well as leading by example when it comes to people risk management.
Just as you would question whether an employee can meet the needs required for the job, you should be asking if your HR department can deliver the employees and environment required.
How could it benefit your business?
"HR transformation has the ability to increase profitability by 91%..."
Research by HR analysts Fosway Group and tech exhibition company HRN has shown that HR transformation has the ability to increase profitability by 91%, enhance business agility by 87%, and improve customer service by 87%.
For a business to progress, you need the right people with the right skills; all communicating effectively. If you look at people as your greatest asset, then HR becomes the foundation of an organisation. From here, consider HR within a commercial context, taking steps to evolve it so it better meets the needs of the business.
Strategic HR development
A company must be sure its HR department can clearly and efficiently support its future needs. To get the most out of HR transformation, businesses need to consider their processes to see how they could better equip their employees to meet market needs, addressing factors such as operating model; risk and governance; process and capacity.
Here are the steps you could take to put your own HR transformation in place:
1) Build a strategic team
HR transformation requires the accurate assessment of business needs. This means that key stakeholders like senior managers, suppliers and customers need to work together to develop a clear idea of desired outcomes. A team with clear expertise and an unbias viewpoint should be appointed to reflect a broad understanding of the business, from top to bottom.
When Banco de Crédito del Perú (BCP), Peru’s oldest and biggest bank, went through a HR transformation, more than 350 employees and partners took part in the workshops and discussions to help it develop its HR strategy,  making sure all involved were invested in the transformation and ultimately contributing to the success of the project.
Once you have decided to nurture your business through a HR transformation, you need the right leadership in place in order to action it.
2) Work out what you want to achieve
With the strategic team in place, anticipated objectives should be identified. These will be specific to your particular business, including objectives such as increased employee retention, engagement or productivity. To be effective consider how to tangibly measure the outcome of your HR transformation.
3) Develop an HR Strategy
In order to transform your HR department, you need the right skills in place to develop a comprehensive strategy that can answer the following:
How does HR fit into the bigger picture of our business?
How can HR drive deliverables such as retention of staff?
Why does our business want to achieve these goals?
How could the HR strategy underpin our commercial objectives?
4) Implement your plan
It is not just as simple as appointing a HR team, but making sure the duties of employees, line managers and HR professionals are clear across the business. You need a defined framework and monitoring system to ensure it is maintained while continuing to evolve with new market challenges.
Here at Phaidon International, we know the importance of achieving strategic business goals. We can help you form a realistic HR transformation plan along with relevant and achievable objectives using our extensive experience in the industry.
We specialise in Corporate Leadership recruitment services and supporting business transformation. We have the expertise to help you understand how to facilitate HR transformation within your business. Please get in touch to discuss this further
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