Traditionally, a company's human resources department has played a supportive role. It was considered a paper-pusher job, and often took a backseat to more numbers-oriented departments like marketing and business development.
While HR still does plenty of paperwork, today's organizations have realized that this department can do much more to enhance and develop a business, thanks to developments in fields like psychology, data analytics and recruiting.
"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," said John Schwarz, CEO and founder of workforce analytics company Visier. "HR shouldn't be relegated to a role where they're only called in when there's a problem."
Using data analytics, HR workers can ask and answer questions about an organization's future regarding issues like outsourcing, cost management and succession planning, Schwarz said.
"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," added Gabrielle Toledano, chief people officer at Tesla and board director at Visier.
In conjunction with succession planning and data analytics, it is now the responsibility of HR to create better processes and training protocols.
Juli Weber, organizational development manager at Business News Daily's parent company Purch, said that there are many strategic responsibilities for HR, including obtaining and recording information from well-seasoned employees, figuring out the best ways to utilize people within the organization and discovering effective management tactics.
Supply and demand
For any business to succeed, it must attract and retain top talent in its field. However, that is becoming increasingly more difficult. This is where a qualified HR professional can step in.
"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.
Lowsky noted that HR has to understand and anticipate an organization's talent needs, know where to find that talent and how to balance the equation. HR reps also need to use consumer marketing principles to build an internal employer brand to attract and retain employees.
"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.' [With] full-time, part-time, contingent workers, volunteers, etc., … HR can build and mobilize a culture to attract the talent you want."
Weber told Business News Daily that benefits might evolve or change in order to attract top talent. For example, many businesses are offering to make payments toward student loans rather than contribute to a 401(k), which appeals to many applicants, Weber said.
It is becoming increasingly important for HR to improve internal processes, create succession ladders, develop professional development and training, and enhance a company culture. One way to do this is to use industrial and organizational psychology to evaluate and enhance an organization, Weber said.
The science of behavior is helping HR representatives create effective training, leadership and management as well as assisting other areas of the organization. Due to the science behind these movements, HR is under less pressure to prove every aspect of the ROI of such endeavors. [Learn more about industrial-organizational psychology.]
"The ROI no longer has to be proven, it's just assumed," Weber said.
Finally, HR personnel have now become marketers, especially as the department designs new protocols and processes.
"We're looking at the HR department as its own entity, kind of like a business inside of a business," Weber said. "Our employees are our customers, and HR has to market programs, processes and training to them."
HR professionals also need to understand the financial impact of decisions in order to market new ideas and processes to the employer, Weber said.
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Additional reporting by Nicole Fallon. Some source interviews were conducted for a previous version of this article.