Big changes are in store for human resource processes and delivery systems. Is HR finally diving into mobile technology and shared services, as opposed just to dipping in a toe?
"I think they're dipping toes, but for the first time they're doing it with their bathing suit on," says Mike DiClaudio, global leader of Towers Watson's HR service delivery practice. "The intention is actually to go forward with mobile. We've seen the trend of the usage of mobile apps increasing. It's not going up like a rocket ship, but it is rising."
A recent Towers Watson survey of HR and HR IT executives from 1,025 companies in 32 countries backs DiClaudio up.
More than one-third of respondents (36%) plan to make a change to their HR structure before the end of 2014. Towers Watson says that among those organizations planning change, 74% say it's to improve operational efficiencies, 53% say it's to improve quality, 37% want to reduce costs and 34% are pursuing a change in business strategy.
"From 2008 to 2011, there was very little money spent in the market on the HR function," DiClaudio says. "There was no money in the bucket. Everyone was focused on the global recession; the HR function was focused on saving the organization money. So things like infrastructure, technology ... were all in a point of stasis. And in the last 18 months, we've seen a loosening of corporate budgets, so HR can actually spend money on upgrading their capabilities."
Despite cost reductions in other areas of HR, technology spending today remains steady and strong. Fifty-three percent of organizations say their investment in HR technology will match last year's investment levels, and another 27% will increase spending, many significantly.
HR-enabled applications remain largely untapped - only 10% currently use mobile applications specifically for HR purposes - but more than 60% of respondents now provide mobile access via smartphones to employees, and 24% offer tablet access. In the next 12 to 18 months, 25% plan to offer HR-enabled applications. Fifty-nine percent of respondents offer an HR portal to employees and another 19%
"Companies have been carefully examining both their HR structures and the way HR services are being delivered, and many have come to the same conclusion: The time is ripe for change," DiClaudio says. "Many organizations see new opportunities to increase HR's strategic contributions to the business. What is really interesting is the continued trend toward replacing core HR systems and a willingness to invest in new technology and partners with a growing shift toward software-as-a-service."
Among those changing their HR structure, 49% are moving toward a shared services environment with HR business partners and centers of excellence. The survey notes that the shared services model is the most prevalent among available options, followed by those intending to outsource additional functions (17%) or move to a single HR function for the entire organization (12%).
The primary HR service delivery issue this year was streamlining business practices, cited by 32% of Towers Watson's survey respondents. Talent and performance management systems tied with greater involvement in strategic business-driven issues for second place at 29%.
"Without question, HR service delivery is in a state of change, and organizations need to embrace that change as the new constant," DiClaudio says. "This means they can change the game by modifying their structure, rethinking long-held processes, adopting new HR technologies and processes, and extending capabilities to the organization via manager self-service and shared services. In the end, it means using new concepts, approaches and technology to provide better HR services."
Technology infuses a business with increased possibilities, and employees can sense that. The very updates that HR might use to better inform, serve and manage an employee population can help increase the engagement they're hoping to measure.
"When we do engagement studies, we find there's actually a pretty strong correlation between someone's belief that the firm they work for is giving them the tools to be successful and their engagement," DiClaudio says. "If you were equipped with nothing but a typewriter, you'd be pretty frustrated. When technology is available, managers feel more able to take charge of their teams; employees feel more able to take charge of their careers.
"From our perspective, engagement is an index, similar to profit or miles per gallon. It's very popular, but it's an index influenced by lots of other things. So you can't just say, 'I want to increase engagement.' There are specific things you have to do, and having insight to that data, having insight to which parts of your organization, when they're engaged, actually add value to the business - that's a fairly hefty analytical conversation."
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