Why HR Needs Digital Transformation
Published: 06/12/2018
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Exploring digital transformation is something many business owners, and OPs directors are interested in. Despite its key role, HR often needs to catch up in the process. To the extent many end up asking - why HR needs digital transformation? In today’s article, we aim to answer the question as well as offer the best course of action.
Digital transformation is often perceived as a tech buzzword. However, companies that fail to keep up with technological changes put themselves at big risk. Namely being overtaken by their more forward-looking competitors.
Don’t get us wrong. This doesn’t mean companies with the latest software or the newest gadgets are more likely to succeed. Digital transformation is about integrating digital technology into all areas of a business, fundamentally changing how the organisation operates. But some areas of the business are less prone to change. HR is one of them.
To put it simply - HR is the beating heart of the business. It should, therefore, be ahead of the innovation game.
It’s a common mistake to assume that digital transformation is all about becoming tech-centred. In reality, it’s very much about the people and enabling them with quicker, more accurate decision-making abilities. Speaking of HR, this means more efficient hiring, onboarding, training and professional development. All of that will influence changes across other aspects of your business.
Digital transformation becoming prevalent across different industries. The budgets allocated to drive it have increased by 25% in the past year alone. However, the process seems to pass the HR teams by. Machine learning, automation, blockchain, business intelligence and other components keep on improving in efficiency and intuition. Yet there’s still a dauntingly huge number of HR staff relying on Excel sheets.
HR is one of the driving components of the business. This is why digital transformation in it is often approached with extra care so as not to disrupt legacy processes. So, while other areas of business are put through rapid changes, most companies take the “slow and steady” route when addressing HR. This, unfortunately, can have massive setbacks across the entire organisation.
The biggest offender of creating a gap between digital transformation and HR departmental silos. Most often the budget dedicated to driving digital innovation is put towards marketing, IT, and sales as these areas are overall seen as ‘technology-driven’. The problem lies within the aforementioned common misconception. Digital transformation is understood to prioritise technology over people.
The Association of Executive Search and Leadership Consultants (AESC) found that legacy processes and mindsets also prevent organisations from fostering innovation. It stops them from achieving digital goals and makes long-term vision unattainable. In other words, companies are seen to be hesitant to change processes in favour of digital transformation. And it inevitably leads to delays.
Chief Human Resources Officers (CHROs) have an essential role to play in changing organisational culture. They contribute towards facilitating new ways of working and managing changes in technology. It’s an important task as the changes impact people significantly. These workers are vital to putting in place tools, processes, organisational structure and talent pipelines to support digital transformation.
A Kienbaum study discovered that 39% of the HR staff’s time is taken by manual admin work. Most of these tasks can be automated, which will, in turn, free up a big chunk of each personnel's time. It can then be dedicated to the execution of more progress-driving tasks. In other words, investing in automating processes will lead to the continuous growth of ROI.
According to another study, provided by Harris Poll & CareerBuilder, cost savings of companies that digitalised their HR department reach 35%. Combine this figure with the above-mentioned prospect of freeing up staff’s schedule in order to prioritise further optimisation. It paints a clear picture of how the digitalisation of the department is ultimately beneficial to your business.
The key benefit of digitalising the HR processes is that you will gain access to deeply insightful data that would otherwise be unavailable. HR is responsible for vital areas of your organisation such as hiring, onboarding and employee retention. And so iit is absolutely crucial their decisions are based on data.
The COVID pandemic has shown how important it is for HR to be capable of reacting fast and in an informed way. Companies with better insights and a digitalised approach were able to adapt to remote working quicker than those that relied on more traditional processes. Overall, the digital transformation of HR grants flexibility by supplying in-depth data. And such data enables progressive improvement of internal processes.
Similarly to how it’s treated across other parts of the business, the digitalisation of HR must be robust and fast-paced. Digital transformation is synonymous with process disruption that leads to either revolutionising it or dropping it altogether. As mentioned in this article previously, the slow-and-steady approach will only set the progress back.
Our Timesheet Portal product is a software-as-a-service (SaaS) tool that can help your business keep on top of HR management functions. The rich list of available integrations ensures that our software will smoothly blend into an ongoing digital transformation strategy. It will also be a perfect starting point if the process has not been set in motion yet.
Or Project product replaces your existing paper-based system with a more efficient web-based portal. Key features of it include online timesheet management and flexible hours tracking, online holiday tracking and approval, expenses management software and much more. In other words, it will save your HR department heaps of time from day one and will keep on giving as you move ahead with newly collected data insights.
The HR department is, undoubtedly, one of the most crucial to the organisation. With the big workloads human resources professionals are exposed to, it’s surprising that this department is among the last ones to embrace digital transformation. When, in fact, it’s in a perfect position to be the driving force of it.
Digitalising HR should be a priority. This is the area of your business responsible for some of the core processes. The fear of interfering with these, on the other hand, is what usually causes the
delay. Unfortunately, the slow-and-steady approach won’t work. To truly boost your business performance through digital transformation, you need to be decisive and disruptive.
Are you ready to truly revolutionise your organisation? Because we are ready to help.