In an environment fraught with uncertainty and change, business leaders are faced with a mammoth task. In addition to navigating through widespread industry disruption, it is becoming more and more difficult to attract relevant talent and to retain staff.
Locally, businesses are suffering from high churn rates, low employee engagement and high levels of stress and burnout. Clearly, something is amiss within HR departments and in the broader approach to managing people in the workplace.
“It is evident that local businesses are still using legacy HR systems and are mired in old and outdated ways of managing their people,” explains Gary Willmott, Founder of Urbian and Hi5, and organiser of DisruptHR Cape Town, a dynamic information exchange platform for HR professionals, executives and business leaders.
According to Willmott, this staid approach to HR is preventing South African businesses from making the shift towards a more agile, lean and innovative approach to their daily operations. As a result, local businesses of all sizes and across sectors are simply not able to stay relevant in a fast changing world.
“Leaders need to become far more proactive, instead of reactive. To make the shift, local businesses should be adopting the technology tools, platforms and processes that will enable them to become more streamlined, efficient and agile with regards to their people,” says Willmott.
“The first step is to harness the wealth of data and information that leaders now have at their fingertips. By using data to drive decision-making at the highest level, leaders can ensure that every resource and skill within the organisation is being leveraged. This requires leadership to remain very close and in touch with employees and what is actually happening on the ground – whether it be through meetings and team builds, or surveys and reports.”
Cost saving opportunity for HR operational cost
According to PwC, on average, direct HR costs account for 28% of overall operating expenses. The same research found that for the majority of PwC clients, an investment into effective HR technology will result in savings of 15% – 25% of HR operational cost.
From the ground up
In addition, employees should have direct access to leadership, and should be involved in ongoing innovation, change and business development. As Google Inc. has demonstrated, and locally FNB, employees should be given the freedom and the opportunities to add their own voice and input. They can often be incredible sources of innovation and instigators of true disruption.
“When implementing new systems, apps or platforms within an organisation, leaders make the mistake of building the system around the company – instead of around what employees actually need and want. This results in low take-up and low engagement. Yet when companies implement systems that are built around genuine user feedback and input from staff, take-up skyrockets from between 20% to 30% to as high as 90%,” says Willmott, based on the success seen with Hi5.
Speaking at the recently held DisruptHR event held in Cape Town, Alexia Cox (PhD), Director of HR consultancy Merging Minds, noted that HR needs to become a “simplified, de-cluttered profit centre that walks its organisation’s corridors with power”.
“Local business leaders need to start by streamlining their processes, outsourcing where they can, and investing in an HR leadership development programme that has hands-on training across functional disciplines,” says Cox.
“They need to be bold. We’ve got about 70% to go – South Africa wants to change but struggles with getting the buy-in it needs within businesses, as well as getting budget to make these changes. HR has been transactional for so long, that it is hard to make a shift to transformational HR. It needs buy-in at executive level.”
Ulrich Meyer-Höllings, Joint Managing Partner at Future by Design also points out that in essence, HR is being “captured” by technology. In his view, companies are having conversations about the future of work that are too one-dimensional – coupled with the belief that “software will eat the world”.
“This will stop HR from having any impact by enriching a much-needed innovation effort – we need a whole new mindset that taps into the right [creative] side of the brain to have a more balanced view. South African businesses are much better suited to thrive in this way of people-centered thinking as we have an important humanist mindset based on the spirit of *Ubuntu. We need to stop looking at places like Silicon Valley and paying the same school fees by copying a misguided tech utopian perspective,” concludes Meyer-Höllings.
*Ubuntu: I am because we are