The 8 Major Trends in HR Today

Rate this Column: (4.4 Stars | 23 Votes)   Thanks for your rating!
benefits and compensation | HR Tech Trends | HR trends 2011 | mobile workforce | telecommuting | health care reform | knowledge management sytems | Business Strategies

Here it is, folks. HRIQ readers and industry practitioners weigh in on the top trends in HR today, in the categories of analytics and metrics; technology; outsourcing; compliance; compensation; benefits and employee incentives; training and development; and a growingly contingent and mobile workforce.  Find out what these industry trends mean for your business, and how to hop on before you miss the bandwagon.

1. Analytics and Metrics

“After nearly 20 years of work developing and helping clients apply evidenced based decision making to workforce management, we are seeing a swift maturing of this market,” says Haig R. Nalbantian, Senior Partner at Mercer and co-author of Making Mobility Matter andPlay to Your Strengths: Managing your Internal Labor Markets for Lasting Competitve Advantage.   “More and more organizations are building in-house workforce analytics capabilities and trying to respond to pressures to establish the expected economic return to programs and practices they propose to senior leadership.”              

In other words, companies are forking over their own time and resources in order to analyze what’s working and demonstrating ROI for their company—not necessarily just following so-called tried and true industry standards that may have worked in the past.

“Best practice benchmarking is no longer an adequate basis for policy determination. The fallacies of that approach are clear to most organizations in the private sector; developing one's own data to ascertain the impact of policies and practices is becoming more the norm. This is a major change and is aligned with developments in other fields like Finance, Marketing, Logistics, etc. that are pushing the boundaries and tapping the benefits of what the Economist has called the ‘Era of Big Data’,” says Nalbantian.
 
2. Technology

Another trend, according to James W. Robertson, HR Transformation Management Consultant for PwC, is “HR wanting to ‘own’ their technology and making a move to cloud based solutions that they can maintain cheaply without having to be dependent upon IT or a big ERP system.”

In addition, many organizations are automating processes through either technology or vendors.

“Most organizations are moving away from handling the labor intensive areas in human resources and managing them through trusted vendors who learn their company culture,” says Charles Little, JR. SPHR, President & CEO at Strategic HR Partners. “These areas include payroll, recruiting, benefits administration, training & development, and organizational development,” says Little.

But why automate the processes that are seemingly an integral part of the HR function?  “The rationale is simple: it frees up time to devote to strategic initiatives driven by the senior management team, and gives human resources the time to concentrate on defining processes, creating measurements, and affecting the bottom line,” says Little.

“I think the one unifying trend is segmentation,” says Kaushik Mitter, Senior Director HR at Dr. Reddys Laboratories. “There are parallels between what is happening in HR and Marketing-Consumer behavior.”

But will this shift be guaranteed to streamline and ease HR functionalities? “The challenge will be to offer a common and consistent employer experience while leveraging technology and touch to understand each person better and build flexibility in to each of these processes, ” says Mitter.

3. Outsourcing

“The customer expectations have changed as have HR functions,” says John H. Williamson, SPHR, GPHR, CCP, Certified Human Resources & Total Rewards Professional. Functions are being outsourced including recruitment, labor relations and total rewards. The workforce is working more non-traditionally.” This includes flexible work schedules, virtual workplaces and greater reliance on contingent staffing, according to Williamson.

“The outsourcing of HR functions has increased dramatically,” says Barry Savage, VP of Resource Management, Inc. “Owners understand the necessity to strategically market their products/services in an economic environment like we are in, while empowering their management teams to develop and implement processes critical to the company's success, and this is reflected in the decision to outsource many of a company's non-core functions—including, in many cases, much of its HR.”

4. Compliance

“Compliance is key,” says Renee Larsen, Human Resources Compliance Manager at Preload Inc. “Whether it be EEO Compliance/Banking series 7 HRMs or Regulatory Managers.  All appear to be in demand depending on the industry. Across the board, I see an increase in diversity job opportunities and promotion of education in diversity in various industries.”

In addition, although a federal agency, the OFCCP is increasing their compliance staff very quickly throughout the U.S., according to Larsen. “For those who work with OFCCP, I advise you to make sure your ducks are in a row and be prepared for auditing purposes.”

Savage also points out an increase in employment-related claims, including EEO, wage and hour claims, wrongful termination, age discrimination, sexual and general harassment claims and others.

“When the economy sucks wind, employers are seen as the deep pocket solution to many employee-related woes, and if an employer does not have the policies, procedures and proper documentation in place when a claim is lodged, it could cost them a pretty penny,” Savage says.

“Combine that with the rapidly changing landscape of employment law under the current administration and budget shortfalls at both the state and federal levels, and you have the perfect environment for compliance audits, generating millions of dollars in fines for states and the feds. Employers also recognize this fact, and apparently they are happy to hand over much of this to professionals whose only job is to keep them compliant.”

5. Compensation, Benefits and Employee Incentives

“I observe a trend in new/upgraded wellness programs and safety programs designed to manage healthcare costs,” says Karen Womack, Risk Manager at Allegheny County. "When our wellness program began a couple of years ago, the course offrerings were limited and employees had to attend the class. Nowadays, there are a number of online courses that are offered in additon to resource modules. Two of the resource modules are related to costs. One allows the employee to look up the costs of medical procedures, and another allows us to look up the generic name of medications and compare prices among a number of vendors that have a link on the website."

This focus on upgraded wellness programs could also be in part to upcoming changes in healthcare, set to occur over the next few years.

“We're seeing a number of organizations beginning to ramp up in preparation for 2014 healthcare reform,” says  Robert Ruotolo, Vice President, Employee Benefits and Risk Management at Lockton. The year 2014 will bring mandates that require employers with 50 or more full-timers to provide health insurance to each of them—or face a fine of $2k per employee. Ruotolo explains in a recent blog post that many organizations are preparing by calculating their exposure to 2014 health care reform.  

“I see that the retail industry is still struggling, but trying to continue to push forward through this economic downturn,” Larsen adds. “Compensation and employee incentives are at an all time low, but employers should look into other ways to reward their employees if bonuses are not an option due to cutting/limiting costs. Remember— it costs more to re-recruit then it does to invest in your current staff.”

6. Training and Development

How learning functions are changing is one indication of a pendulum shift, but the role employees place on learning and development may be even more notable. A hefty paycheck and great benefits are always top of mind for most desirable candidates –  but another major change that’s occurring in the HR and recruiting space is that employees are looking for companies that will provide them the skills necessary to prepare them for their long-term career goals.

“One of the trends I have observed [amongst employees] is the desire to be trained and developed,” says Steven McCorry Sr., PHR., a strategic HR executive. “Most employees today are putting a stronger satisfaction rating on whether their employer is developing them. This is clearly stemming from the challenging and competitive employment landscape.”

Attribute it to generational differences or simply a survival mechanism due to high layoff rates (thanks to outsourcing and budget cuts), but employer loyalty seems to be a sentiment that will fizzle out once the last Boomer retires from the workforce. The death of such antiquated concepts as tenure and pension plans leave Millennials responsible for their own retirement— thus, their interest is vested in their own future and  career, not necessarily in the growth of the company that happens to be paying the this month’s rent. Few employees develop their career anymore by growing vertically within the same company, instead building resumes and skill sets by taking a slight promotion or even a lateral jump to a better paying, more prestigious organization.

This may seem a bit opportunistic, but it’s the reality of the new generation. What can you offer to get these employees in the door and make the most of their time at your company? Think about revamping and repackaging your L&D function as a selling point to attract top talent.

"We need to focus on practical, real life training that gives participants tips and strategies they can use right away," says Judy Lindenberger, MBA, who has worked with companies such as AstraZeneca, BMS and American Express. "Personally, I love this. It makes me think harder about what to keep and what to delete from my training programs and how to create impact in shorter amounts of time and for human resource professionals, it means the same."

This seems to be a global consensus. "Learning is becoming more individualized, informal, and location independent,” says Professor Eric Y.H. Tsui, VP of Hong Kong’s Knowledge Management Society, researcher and practitioner in cloud-based knowledge service, blended learning & uni-industry collaboration.“Major reasons contributing to this trend are the advancement of the Web technologies especially Web 2.0.  Transformation into the new economy gave birth to knowledge work, and we are facing an increasingly complex and far changing world."

7. Contingent Workforce

“The rise of the consultant and contingent workforce at multiple levels throughout Fortune 500 organizations has lead to short-term assignments, harder to understand resumes, and increased specialization,” says John LaFay, HRIS Professional. “This has also led to an explosion of ‘pimp services’ global, using Skype and storefront websites.”

Says LaFay, “Long term is now considered 12 months—if you make it that far, you might just be a fit for more responsibility. Only then are people eligible for ancillary benefits of training, coaching, and career planning.”

8. A Growingly Mobile Workforce

Thanks to tablets and the growing availability of wireless technology, more and more companies are reducing overhead costs by letting their constantly wired workforce telecommute.

Statistics show that allowing employees to work from home at least part of the time can increase productivity by 15 percent and save the company an average of $10k per year per employee, according to a study by the Telework Research Coalition. Additionally, this saves the employee about $7k annually, reduces turnover and improves company loyalty.

“In most cases, the arrangement is to the mutual benefit of both employer and employee,” says BrijendraChaudhary, HR Executive at Permasteelisa Spain United Arab Emirates. “An IDS study on teleworking dated May 2002 examined home working at Abbey National, where it was thought that home working would be a good motivational tool and would consequently improve productivity in the workforce. In another organization, Fleetway Travel, the business case for home working was seen as particularly strong; the idea that more staff could be brought in to enhance sales – without the need for increased office space – held great appeal.”

The Telework Research Coalition provided additional supporting insights: 89 of the top 100 US companies offer telecommuting; 58 percent of companies consider themselves a virtual workplace; only nine percent of employees worked at headquarters; and 67 percent of all workers used mobile and wireless computing. 

Contributor:   Alexandra Guadagno

Alexandra Guadagno is the Editor for Human Resources IQ, an online community sharing HR best practices. 

Before Human Resources IQ, Guadagno developed business strategies and worked with front-line employees as a business manager at a retail fashion giant. From this experience, she developed an interest for working with HR professionals and began reporting on the issues and trends facing the industry. Guadagno has written for Asbury Park Press of New Jersey and has also worked as a freelance journalist for the Two River Times , covering topics ranging from the arts to wage equality issues.

Guadagno holds a BA from Rutgers University with a major in Journalism and a minor in Cultural Anthropology. She began her journalism career by co-founding the global youth news website ItsOnBad.com, where she wrote business and technology news stories for fellow students.

Contact her at alexandra.guadagno@humanresourcesIQ.com

You Should Check Out:

Personal Competency and Employee Health Care: Corporate Wellness & the Employer’s Role

Report Abuse   Raza 08/16/2011 12:38:37 PM EDT A very professional article based on practical orientation. The measures highlighted in the article, if applied can develop employees into an efficient workforce that guarantees the growth of an organization, Replies (0) Post a reply Sign in or Sign up to post a comment