Human resources management (HRM) is now at the center of corporate decision-making for organizations in recent years. HRM is at the thick of things when it comes to strategy planning with the board, policy-making with line managers, and promoting value adding initiatives and programs to contribute to organizational efficiency.
Human resources development (HRD) is one facet of HRM that focuses on the development of employees. HRD techniques and strategies take care of an organization’s biggest asset: the employees. Happy employees are productive employees and productive employees mean a productive and profitable enterprise. HRD mainly focuses on training and development, career management, performance management, and in some cases, organizational development.
Several factors can be identified as the catalyst of the challenges in HRD. Organizations now have to be agile in dealing with the rapid changes happening within and around them. These changes are largely driven by the huge technological breakthroughs we have contended with in recent years. In this hyper connected and globalized world, the landscape of organizations is being disrupted. This coupled with the evolving nature of both the workers and the work, HRD has its work cut out.
Changing nature of the workers
According to a report published by the SHRM Foundation entitled Evolution of Work and Worker (2014), the current global workforce has become even more diverse along three lines: generation- wise, gender-wise, and culture-wise. Organizations must be able to adapt to the changing needs of the workforce.
We now have three generations interacting in the workforce: the Baby Boomers, Generation X, and Generation Y or also known as the Millennials. The last of the Baby Boomers are now going into retirement. Some countries have adjusted the retirement age to keep this generation longer in the workplace. This is because knowledge transfers are not happening fast enough. The larger chunk of the workforce belongs to a younger set of workers. Even so, the generational influences that affect how they work needs to be articulated and addressed. The millennial generation, in particular, has become a puzzle for organizations. There is a particular work motivation that is unique to this generation. And much research and analysis is being done one them.
In terms of gender, the number of women have surpassed men in tertiary education. More women who are highly skilled will be joining the workforce in the coming decade. This means that the issues on the gender gap must be addressed at a much faster rate. We also have the global diversity of the workforce to factor in. The migration of workers has reduced the cultural homogeneity of most companies. More and more workers seek greener pastures. We have seen the movement of workers to the urban centers to chase work opportunities. We have also seen workers move to developed countries or migrate to countries where their field of expertise is highly valued. Case in point is New Zealand: they have a shortage of skilled workers and have been trying to attract migrant workers to compensate for this shortage. Another example is the local brain drain in our country. We see experts and professionals moving out of the country to find jobs that provide higher pay an
This diversity means that the culture of organizations must also change. In the next 10 years, the shift in the profile of the workforce will be more apparent.
Changing nature of work
The nature of how jobs are done is rapidly changing as well. Some jobs have become obsolete due to automation. On the flipside, there are jobs that have become more complex due to the same technological advancements. The “human factor” is becoming increasingly important despite the automation of a lot of things.
Technology has also allowed employees to telecommute or work from home. This means that the physical presence of an employee is not as required in the workplace. Work is no longer defined by physical confines. Some studies have shown that employees who telecommute have increased their productivity levels. A lot of companies are now adopting this scheme as it has been found to be a factor for job satisfaction and it also reduces their infrastructure cost.
Organizations are also moving their operations and sales in a global scale: production operations in one country, sales in another location, and administrative support in another. This gives them a bigger market of potential employees and a way to lower production costs.
Global Trends in HRD
The 2017 Global Human Capital Trends by Deloitte identifies 10 key trends that HR practitioners will have to face. Much of these trends came up due to technology. But as mentioned earlier, this is also something that needs to be done to consistently engage the changing workforce. We will be discussing four of them.
The Organization of the Future. Previous organization structures were hierarchical and siloed in nature. This means that each team dealt with their goals separately and achievement is compartmentalized into business clusters. For organizations to work in the current disruptive environment, they have to be quick to adapt. The hierarchical structure makes it much harder to keep up with all the changes. Organizations of the future must now adopt work models where work is done in teams. Teams must become cross-functional in nature so they can approach problems holistically. These teams are collaborative networks where individuals bring their technical expertise to the table and share what they know to come up with solutions much faster. And these teams are formed based on the product or service that needs to be developed so team members and leaders are not fixed on one project alone.
Changing Concept of Career and Learning. Organizations are now going to be characterized by higher career mobility and curated learning and development experiences. Hierarchical organizations do not provide much mobility in terms of career exploration: it is either you move up the ladder or you go out. Transforming organizations into team networks provides opportunity for employees to explore their talents and bring a different capability to every team formed. Having cross-functional teams enable employees to explore different assignments and expand their skill set. Traditional learning management systems now have to be replaced by newer learning tools. The old systems are focused on developing virtual universities and online course catalogues. Now, the focus is integrating various platforms and curating the learning experience through these platforms. These curated experiences are not limited to the traditional learning methods, but also integrate video and mobile learning solutions, micro-learning strategies, and use the wide range of available libraries of massive open online courses and other learning hosts.
Reinvention of Performance Management. Performance management (PM) is usually the annual or semi-annual goal-setting session and performance appraisal. As the structures in organizations are shifting, there is also a need to revamp the way PM is being done. Shifting into collaborative network of teams means that employees shall be evaluated not just based on individual performance. There is also a need to come up with performance metrics for teams. Performance check-ins should be done more often. Goal setting should be collaborative process. Couple this with regular feedback so that employees know how they are doing. In this way, performance improvements are more instantaneous and apparent.
Redefining the Employee Experience. As organizations are transforming into networks of teams, there is a need to redefine the end-to-end recruitment to retirement experience of employees. Traditionally, the contact of employees with various HR departments are separate interactions as a product of being in silos. This results in a somewhat erratic engagement with employees. There is a growing need to integrate the entire experience according to how the employee might encounter these things. New approaches such a design thinking and innovative thinking can help organizations improve this experience. Some factors that need to be integrated into this are: employee’s well-being both at work and at home, high impact learning culture, talent mobility, and compensation and reward systems, among others. Engagement needs to be real time and tangible so an entire team must be dedicated to developing this.
HR Trends in the Philippines
In a study done by Vivien Supangco in 2012, the strategic HR practices in the Philippines are qualified through two tiers: (1) level of involvement in strategic formulation and defining policies; and (2) activities that add value, uses computerized information systems, and engages external providers for non-core activities. Looking at the first qualifier, HR practices in the country are strategic. However, the level of involvement in strategic formulation with the board is still highly dependent on the CEO’s prerogative.
In terms of adding value to programs and initiatives, there seems to be an increase in the usage of HR information systems in local organizations. Learning and development is still mainly outsourced through service providers. Performance appraisal is now being done across all worker categories in 2008 (Supangco, 2012). There is no mention of changes in the way these things are being done in the research.
On the training side, most organizations still prefer to have the rigid curriculums of having a combination of classroom and on-the-job training experiences. These curriculums are tied to the learning roadmaps of job families and are often the basis of the qualifications for promotions. There is also a continuous trend in translating learning materials into web-based programs. Some bigger organizations partner with universities to broaden the knowledge and skills of their management candidates. Some organizations do have mobile applications available to their employees for their learning management system.
There has also been considerable effort in trying to address work-life balance of employees. Programs and initiatives such as wellness days, flexible work hours, work from home options, flexible benefit programs, and the like are being introduced.
As we can see here, the global trends and solutions in HR are trickling down to our local organizations. But this is happening at a much slower pace. HR practices in the Philippines are still on the traditional side. In most small to medium organizations, HR is an administrative job. The bigger and sought after organizations are usually the ones with initiatives that try to ride the tide of the current trends. But we have also seen the emergence of start-up organizations in the country. These organizations are slowly finding their niche as alternative service providers and cater to various industries. Most of them are run by millennials who seem to have a better idea on how to engage high performing and high potential individuals.
Where do we go from here?
According to the April 2016 Labor Force Survey by DOLE, 44.3 % of the current workforce are in the 15 to 34 age group, or what we know as the millennial generation. They have begun to occupy positions in middle management and senior levels, too. Soon, Generation Z will be joining the workforce. There is a growing need to understand this chunk of employees while still catering to the older ones. The HR trends that we are seeing globally now have much to do with this changing demographic of the workforce. According to the 2016 Deloitte Millennial Survey, they found that millennial workers would prioritize a sense of purpose around people than profit when it comes to businesses. Personal values play a big role when it comes to decision making about work. Organization sustainability needs to be more that financial performance for them.
HR needs to evaluate how things now can become a more curated experience for employees. Aside from a good compensation package, HR now needs to rethink the way they provide career development options that allow employees to strengthen their knowledge and skills; and maybe introduce programs that promote higher career mobility. Invest ample time and training in coaching and mentoring and develop constant feedback systems. Performance management should not be an annual checkpoint but rather a continuous process.
Clearly, HR can no longer do with solutions that are one-size-fits-all.
- 2017 Deloitte Global Human Capital Trends (2017) Deloitte University Press.
- Deloitte Millennial Survey 2016. Deloitte University Press.
- Future Global Trends Affecting Your Organization: Evolution of Work and the Worker (2014) The Economist Intelligence Unit.
- Labor Force Survey (2016)
- Supangco, V.T. (2012) Strategic HR Practices in Some Organizations in the Philippines. Philippine Management Review 2012, Vol. 19, 35-48