Until recently, human resources professionals primarily played a supportive role for organizations. They filled out paperwork, administered payroll and benefits, and perhaps even had a hand in the hiring process. While HR departments still do all of these things, many companies are beginning to realize that this position has the potential to be much more dynamic — and beneficial — to business.
"The talent shortage is real, and it continues to affect employers globally," said Bram Lowsky, group executive vice president of the Americas at talent management and workforce solutions provider Right Management. "The role of HR needs to change and evolve to really support the talent strategy in an organization and accelerate business results."
"Business growth is predicated on the ability to attract and retain the right people," added Jeremy Roche, CEO of cloud ERP and accounting solutions provider FinancialForce.com. "If HR is not at the forefront [of a company], small businesses will get constrained in the fight for talent."
Historically, HR has taken a backseat to other departments like marketing and business development because it didn't speak the "numbers" language of business, said John Schwarz, CEO and founder of workforce analytics and planning solutions provider Visier. But the introduction of Big Data in employee hiring and retention strategies is beginning to turn the tables. [4 Ways to Ensure You're Recruiting the Best Talent]
"HR used to be a service organization," Schwarz told Business News Daily. 'Today, it's strategic. HR [can use data analytics] to ask and answer strategic questions about the future of that organization — outsourcing, cost management, succession planning, performance management, etc."
Lowsky noted that today's HR professionals should serve three major functions: supply-and-demand experts, marketers and designers. First and foremost, HR has to understand and anticipate an organization's talent needs, know where to find that talent and figure out how to balance the equation, he said. HR reps also need to use consumer-marketing principles to build up an internal employer brand to attract and retain employees. Finally, HR has the responsibility to "design" the workforce and culture that best suits the company.
"HR is evolving to start looking at the marketplace differently because of the skill shortage and talent gap," Lowsky said. "We're building the workforce differently than just the traditional 'full time and part time.' [Now there are] full-time, part-time, contingent workers, volunteers, etc. HR can build and mobilize a culture to attract the talent you want."
So what can your company do to bring HR center stage? The first step is to make sure your rep has the right tools at his or her disposal to streamline the HR process.
"Often, smaller companies will have one payroll system and use spreadsheets and paper for other activities like benefits open enrollment, job applications, etc.," said Bryan Timsah, human resources manager of home-building company Home Creations. "However, as competition in these systems grows and more move to software as a service in a cloud-based platform, the costs tend to drop. This allows smaller organizations the opportunity to implement more advanced systems and become more efficient in overall HR administration."
If your HR manager doesn't already report directly to the CEO or company leader, changing this structure can help ensure that executives can actually use the valuable information to which HR has access for strategic planning.
"I'm a fan of HR reporting to the CEO," said Gabrielle Toledano, executive vice president and chief talent officer at Electronic Arts and board director at Visier. "If you put HR under legal or another executive function, it hinders the strategic additive capability [of the department]. Ultimately, HR has the ability to provide the CEO and other executives with data, analytics and advice so they can see where things are trending and can manage proactively."
Smaller companies don't always have the budget for a dedicated HR professional, and may ask an employee in another position to add HR responsibilities to his or her existing tasks. However, given the growing importance of this role for companies of all sizes, you may want to make an HR position a top hiring priority.
"As soon as there's an HR person in a small company, that person should negotiate for a strategic role where they're not only doing recruiting and payroll, but setting policies for how that gets done, and how management generally deals with people," Schwarz said. "HR shouldn't be relegated to a role where they're only called in when there's a problem."
Originally published on Business News Daily