As a backdrop, let me note the headlines released at the World Economic Forum in Davos. The theme this year is the “Fourth Industrial Revolution,” focused on the way digital technologies have radically impacted our lives, our societies, and our experiences at work. These changes, which impact organizations in every country, are coupled with a workforce that is increasingly diverse (in gender, age, culture, and nationality), demanding, and mobile. The result: the way we manage, lead, collaborate, and organize ourselves is undergoing radical change.
Adding to these changes are a tremendous number of new innovative technologies, tools, and systems for HR. The HR technology industry was on track to receive more than $2 billion in investment capital in 2015 (CB Insights research), fueling a dizzying number of new tools for recruitment, performance management, learning, wellness, analytics, feedback, and employee engagement. All this new technology is likely to revitalize and change HR in major ways, forcing us to be vigilant and aware of new ways to get things done.
- Digital HR has arrived. The first topic to discuss is the brave new world we now call Digital HR. Unlike ever before in my career (I have been working since before the days of the PC), technology change is everywhere, driven by mobile devices, sensors, location awareness, and soon wearables. The new digital life we lead (and the digital workplace we operate in) demands a complete refresh of HR: the way we think of programs, the way we deliver services, and the way we develop solutions.
Digital HR embraces design thinking, modern tools and technology, video, behavioral economics, and the use of embedded analytics. You have to think about your HR solutions as “platforms” rather than “systems or programs.” Your comfort and familiarity with these new domains will be critical in the year ahead.
- Replacement of dated HR technology will accelerate as focus on the employee experience grows. Today, thanks to the investment capital I mentioned above, you can buy easy-to-use, cloud-based tools that support a wide range of HR applications (from payroll to learning to performance management to employee engagement and wellness). In 2016 the massive replacement of old technology (both core HR and talent systems) will continue and we will see companies abandon or plan to discontinue systems that aren’t easy to use, seeking better analytics and more mobile access.
- Talent management (and the platforms we use to deliver it) will reinvent itself. While the concepts of talent management are now about 10 years old (we published our first talent management framework in 2006), we are now completely rethinking how we manage people. Careers are much more dynamic, we have to accelerate leadership and professional development, and the worlds of recruitment, performance management, and training are now driven by the employee. Just as the talent management software market exploded in the early 2000s (then to be largely consolidated by ERP companies), I believe new innovative vendors are now disrupting the market once again.
- Performance management reinvention will further catch fire round the world. Everywhere I go, from India to China to London, New York, and Silicon Valley, I hear people tell me they are totally reinventing the process of performance management. As I describe in the report, the big change here is not doing away with ratings or changing the way we assess people, but rather a completely new way to think about management itself, and the role managers play. This is a profound change in thinking, forcing us to rethink our culture, rewards, the role of managers, and how we direct and align people in the organization. Companies today are turning into “networks of teams,” so many of the traditional management practices we developed over the last 20 years are open to debate. Read more in the report; I promise you this topic will get hotter all year.
- Engagement, culture, and feedback will be CEO-level topics in companies everywhere. What started as a small idea (the concept of the “always-on engagement survey”) has now become mainstream, as companies in all industries realize that they must compete and operate based on culture. If you don’t know what your culture is and you’re not watching it on a daily basis, you can’t possibly curate and improve it. So the world of pulse surveys, always-on feedback tools, anonymous suggestion systems, and corporate “Like Buttons” is upon us. One of our clients now has a red/yellow/green button people press at the end of their shift, telling management how well their day went every day. We in HR have to take this one on and build systems and frameworks to harness all this feedback so executives can make informed decisions on a regular basis.
- Global leadership development will change. We are doing a lot of research on this topic right now, and my conclusion is that the current models we use are broken. Books like Leadership BS1 and The End of Leadership2 tell a story: we simply are not building leadership fast enough, early enough, or with enough of an open mind. As I describe in the report, it’s time to accelerate people into leadership earlier in their careers, put a greater focus on mentoring (leveraging the boomers who aren’t retiring yet), and create new models and reward systems for talent mobility. If you haven’t taken a fresh look at your company’s leadership development strategy (and programs), this is the year to do it. It’s still a top business issue and many new ideas and approaches are now entering the market.
- Corporate learning will go through a revolution. I haven’t seen this much disruption in corporate learning since I started as an analyst back in the early 2000s. Employees are now in charge, video learning is everywhere, and hundreds of new learning tools and platforms are entering the market. The L&D profession and function has fallen behind, and after three years of double-digit growth, it’s time for L&D to focus on digital transformation, learning experience design, and open peer-to-peer learning like never before. The report gives more detail, but let me simply say that in today’s economy, where income inequality remains a top political issue, “The Learning curve is the Earning Curve”—so your employees and job candidates expect you to turn corporate learning into a magnificent part of your overall employee experience. Lots to do here.
- Diversity, inclusion, and gender inequality have reached board-level priority. The topics of inclusion and diversity have been HR topics for decades, but in 2016 they will become primary in everything you do. Our new High-Impact Talent Management Research shows that “building an inclusive culture” is now the #1 predictive strategy for global financial performance, bringing this topic into the focus of CEOs and senior execs. Part of the reinvention of talent management is to embed inclusion and diversity into every people practice in the company (from sourcing to recruiting to assessment to promotion)—and the political landscape has made this visible in every industry. Where I live (Silicon Valley), companies are now bending over backwards to promote programs focused on women, race, and cultural diversity—this will impact your design and thinking throughout HR so watch it grow in importance throughout the year.
- Analytics and data-driven decision making will go mainstream. We’ve written about analytics for almost a decade now and it has been a backwater but interesting part of HR for years. This year I see it going mainstream, with analytics teams now appearing throughout HR, analytics experts coming from other domains into HR, and innovative vendors and tools now flooding the market. I believe the “Internet of things” and the “quantified self” will converge, and we will see huge opportunities to leverage the data we have about people to understand how to improve the work environment, curate and better our culture, drive higher levels of performance, and reduce risk fraud and compliance violations. If you don’t have an analytics team in your HR organization today, you should build one—your ability to harness and understand the data about your people is becoming core to HR’s mission in 2016.
- A reinvention of HR will take place, as a new breed of HR professional enters the stage. Finally, in 2016, I believe we will start to see the impact of Millennial thinking on the HR profession in a bigger and bigger way. Young, innovative, creative professionals are entering senior roles in HR, and they are bringing new ideas about how to leverage digital technologies, how to use behavioral economics, how to experiment with new programs, and how to create a more flexible and humane work environment than ever before.
The new digital workplace we live in is both exciting and somewhat “hard”—it creates stress, overwhelming streams of information, and a feeling like we are never able to keep up. Today we feel like we operate in an “all-you-can-eat information buffet”—we see lots of food, we try to eat it all, and we feel bad afterwards. I think this year is the time for more design thinking, a focus on simplicity, and a lot of effort to reorganize to help make work easier.
Finally, I am personally getting tired of reading articles that bash HR, talk about splitting up HR, and talk about why we should give HR to non-HR professionals. Those days are behind us (in most companies) and I think 2016 is a time for exciting change, innovation, and creative growth in all areas of talent.
Please read the report and send me your comments, I greatly look forward to hearing from you. You can email me directly at firstname.lastname@example.org—I look forward to an exciting 2016 working with you.