A new mindset is the key to HR digitalisation

HR digitalisation can reap great benefits but needs to change focus from a user-centric approach to a customer-centric that focuses on the employee

Organisations that embrace HR digitalisation will see a clear increase in employee performance compared to those who continue taking a user-based approach, says Aaron McEwan

Digitalisation is so important to business success that (according to Gartner research) 67 per cent of business leaders believe that their companies will no longer be competitive if they do not become significantly more digitalised by 2020.

Gartner describes digitalisation as the deployment of digital technologies and practices to enhance the existing business model (via products, channels or operations), or to create new business or operating models.

Business functions, from sales and finance to marketing and customer service, are all using technology and digitalisation to be smarter, make quicker decisions and add more value back to the business.

This new way of working is also top-of-mind for chief human resource officers (CHROs), who at the start of 2018, cited digitalising HR as their number one priority. When probed further and asked to explain the key areas they expect digitalisation to have the most impact, employee experience topped the list.

For the HR function, digitalisation will only work if it shifts from a user-centric mindset to a consumer-centric one; focusing more on what employees’ value from their experiences with the company, rather than implementing admin heavy systems that attempt to be all things to all employees.

The benefits are clear; organisations can expect to see a 14 per cent increase in employee performance compared to companies that continue to take a user-based approach to the employee experience.

“Business functions, from sales and finance to marketing and customer service, are all using technology and digitalisation to be smarter, make quicker decisions and add more value back to the business”

Digitalising the employee experience
The average HR function spends between 3.5 and 9.5 per cent of their budget on technology, but digitalising isn’t all about technology. In fact, investing in technology alone has no significant impact on employee performance; there’s only a 0.2 per cent difference in employee satisfaction among workers in organisations with a tech transformation, and those without.

For HR, that means digitalising its own function in a way that positively improves the employee experience, leveraging technology yes, but not relying on it.

Take for example the typical way employees apply for leave within large organisations. It’s the same process, regardless of the type of leave. But some types of leave have a greater emotional investment, like parental leave, which may involve concerns about status, pay, benefits and the wider team. It needs a human touch and must be handled differently.

Mapping moments to add value
Organisations must take the time to map out the moments that matter to employees and then use technology to help make these processes or activities easier for them to navigate.

Digitalising manual processes is only the first step. Designing processes that use technology to evolve as employee needs and priorities change are where the real value lies. Employees in a consumer-centric environment are likely to be 35 per cent more satisfied with how their organisations support their work and life.

“The average HR function spends between 3.5 and 9.5 per cent of their budget on technology, but digitalising isn’t all about technology”

Only by deep-diving into the frustrations, challenges and opportunities of what employees value the most will HR be truly able to positively impact the employee experience.

HR teams who take on a consumer-centric approach to HR processes are able to:

  • Empathise with what employees’ value: Prioritise solutions by also understanding what the workers want from their experiences. E.g. implementing a digital leave form process, but knowing that one for bullying or harassment will still require a human touch
  • Design solutions that evolve easily: Centre the design process around experimentation to create products that improve progressively over time. By building iterative systems, they can evolve and change with the needs of consumers (employees)
  • Deploy solutions through easy experiences: Deploy effortless HR tools by guiding actions through constrained choice and nudging. E.g. A learning management system that suggests specific training based on identified goals and gaps, rather than an unlimited choice of courses