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  1. Government Computing
August 12, 2022

Why HR must take firm steps to become a more data-driven function

The HR function has come to be seen as business-critical. How might HR leaders leverage this newfound status – and to what extent is it impacting their own skills and digital requirements?

The world of work has changed irrevocably. Many people have switched jobs or even careers, while others have found that the nature of their role has shifted. Even today, long after the requirement to ‘stay at home’ was lifted, many white-collar workers continue to work remotely, or have switched to a hybrid model.

HR departments have borne the brunt of these changes. Tasked with overseeing redundancies, placing some employees on furlough and figuring out how others could work from home, HR played a key role in helping organisations weather the pandemic. According to the People Profession 2021 survey from the Chartered Institute of Personnel and Development (CIPD), produced in association with Workday, nearly two-thirds of HR professionals upskilled or reskilled during the crisis.

HR must become more data-driven
On the technological side, the People Profession survey found that HR professionals were becoming more receptive to digital transformation. (Photo by portishead1/iStock)

If it wasn’t clear before, it certainly is now: HR is far more than an administrative function. As Peter Cheese, CEO of the CIPD explains, the ‘people profession’ is enjoying a newfound recognition as a business-critical role.

“During the pandemic, HR professionals were placed front and centre in the business agenda in ways they hadn’t always been,” he says. “That has put HR in a stronger position, but at the same time, it has got to step up to add the value that we know it should.”

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He believes that HR departments haven’t always invested in their own skills and technological development as much as they ought to, and that this needs to change. Quite aside from the pandemic, organisations are currently dealing with a number of additional challenges – issues around the attraction and retention of talent, a looming economic crisis, questions of fair pay, and the fallout from Brexit to name a few.

“We’re facing an extraordinary series of crises, and that continues to place pressure on HR,” says Cheese. “That’s accelerating the recognition that we haven’t done enough to invest in our workplaces, invest in building good jobs, invest in learning, or invest in technology.”

On the technological side, the People Profession survey found that HR professionals were becoming more receptive to digital transformation. Half of respondents said they used people data and analytics, up from a third in the 2020 report.

Making use of data

“I often quote something I heard from a business leader a number of years back, which was: ‘the problem with HR is you bring too much PowerPoint and not enough Excel’,” says Cheese. “We’ve got to bring better data, both quantitative and qualitative, and work very closely with functions like finance and marketing on a shared agenda.”

Imran Razzaq, sales director, education & government UK & Ireland at Workday, agrees that data is critical to helping HR leaders make the right people decisions.

“Historically, HR has very much been seen as a soft skill, but I think we’re going to see HR functions evolve to become much more data-driven,” he says. “Having modern software technology solutions, leveraging automation, makes delivering insights really easy for decision-makers.”

As he sees it, the advantage of becoming more tech-driven is that you can develop a very granular understanding of your people and their needs. It helps leaders understand where the gaps are, what training is needed, and which people need which support.

“This makes it easier for organisations to align talent to whatever mission they’ve got,” he says. “If you develop your own people, the likelihood is they’re not going to leave.”

So why then is the issue still dividing HR departments, with half of survey respondents stating they don’t use people data and analytics? Cheese points out that, unlike financial information, people-related data is not so easily quantified – how do you reliably measure wellbeing, for instance? On top of that, it changes a lot, and doesn’t have clear standards.

“I’m a very strong advocate of the view that we do need more data, more insights, more analytical capabilities, but I will say that if it were easy, we would have all done this long ago,” he says. “I’m sure many of those who responded ‘no’ would come from smaller enterprises where they have fewer resources to call on.”

A public challenge

A company’s willingness to embrace technology, or otherwise, may also depend on its sector. Historically, public sector organisations have tended to lag the private sector when it comes to big tech investments, not least because private sector companies are always on the hunt for competitive advantage. Especially in this time of tightened budgets, public sector organisations may also be under greater financial constraints than private enterprises.

That said, attitudes have changed since the start of the pandemic, which has highlighted the value of jobs like nursing and teaching. Public sector organisations are realising how much hinges on their people – do employees derive meaning from their jobs and are they being adequately supported during this time of crisis? This in turn has created a push to better support and digitalise the HR function.

On top of that, public sector organisations are accustomed to sharing knowledge and best practice. In that regard, they may actually be at an advantage when it comes to adopting new approaches, learning from peers as to where most value can be derived.

“I think there’s a greater lens now on human capital, and its importance in delivering results and outcomes for the institution they work for,” says Razzaq. “There are some really innovative and progressive organisations in the public sector, that recognise the value of their people.”

Workday itself has 18 public sector customers that use its Human Capital Management platform to help them deliver on their goals. Although these organisations are all quite different, Razzaq remarks that they share a growth mindset – each is on a public service mission and wants to be world class.

“They bring that mentality to the way they do everything, whether it’s finance, HR, customer service or product development,” he says. “That’s what I see across all our customers – the quality, the leadership. They are forward thinking and want to be the best at what they do.”

There can be no doubt that organisations – especially those in the public sector – have a lot on their plate . Transport strikes, NHS staff shortages, and the so-called ‘great resignation’ are barely out of the news. The challenges for HR leaders should not be understated, but neither should the opportunities.

“It’s that great Churchill quote: ‘Never let a good crisis go to waste’,” says Cheese. “It’s time to accelerate everybody’s thinking around these issues because they are not just HR issues. They are absolutely fundamental, strategic business challenges.”

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