Many aspects of life in HR have changed dramatically since 1988, but will the pace of change be the same over the next 20 years? Kate Hilpern reports.
HR and the economic climate
1988’s summer pop hit The Only Way Is Up captured the mood of Personnel Today’s launch year,” remembers John Philpott, chief economist at the Chartered Institute of Personnel and Development (CIPD). At that time, the economy was in ‘boom’ mode. But by 1990 recession had returned and the priority for HR was to dish out redundancy notices as efficiently as possible.
These days, HR’s priorities have switched from tackling the consequences of corporate downsizing to fighting the war for talent, although the economic climate is becoming more unsettled.
“The next 20 years look set to be even more challenging, with organisations striving to recruit talent in the context of continual restructuring, which both creates and destroys jobs at an ever faster pace,” says Philpott.
Recruitment is just part of the picture. The task ultimately facing HR is to help organisations sustain high performance outcomes while also improving the quality of working life. Philpott says there’s a challenge for HR here too. “A criticism of some HR professionals in the past two decades is that, in an effort to demonstrate their hard-headedness as business partners, they have too often acquiesced in short-sighted macho-management.
“With 21st century capitalism instead favouring organisations based on trust and collaboration, HR must now aspire to a leadership role within the corporate world which shows that business success and good work can go hand-in-hand.”
HR and corporate strategy
Will Hutton, chief executive of the Work Foundation, agrees that more attention needs to be given to HR as a strategic function. “HR, in the past 20 years, has not been a happy story,” he says. “It’s been a story of reduced voice in the boardroom, as an implementer of largely technical things to do with people management: pay, disputes, redundancy, compensation and dismissal. In other words, not strategic.”
Hutton’s hope is that the next 20 years will see a change. “I think the business case for HR being able to improve things, particularly for knowledge workers, is so overwhelming that you can’t resist it.
“I hope to see a resurgence of HR and a reinvention of it.”
Martin Reddington, author and speaker on HR transformation, believes technology is being designed at such speed that it will ultimately take away almost all of the traditional tasks of HR, creating head-room for them to move into a higher value operation. “This will involve displacing more activities out into the organisation for managers and employees to do themselves,” he says.
But there’s a caveat. When HR technology works well, it can be really well-received. When it does not, it can create quite a backlash and HR’s reputation could be damaged rather than enhanced.
Reddington believes this is a very real danger for HR over the next 20 years. “When you order a book off Amazon, you don’t need a training manual. Even those nervously going on to the site for the first time will find it easy. For me, this is the crux of everything to do with HR technology in the future – making even the most complex things easy to use at the interface.”
Technology will ultimately reduce the headcount of HR practitioners, admits Reddington. “But those who are left will become high-level business consultants. I can imagine a day where you’ll have a virtual HR assistant – a face that appears on a computer or a hologram on a desk – who is able, through their advice, to assist managers to achieve their priorities.”
Another concern for HR practitioners is that as technology enables them to work more remotely, there will be a perception of alienation of the function.
Hutton doesn’t see this as a positive trend: “I think there is a danger that HR departments will get smaller as HR roles are increasingly passed on to managers, and as a result I think there may be more contracting-out of HR so that it becomes a profession you use for exceptional circumstances rather than routinely.”
Lesley Gavin, futurologist at BT, says HR should prepare right now by welcoming developments like social networking. “If you employ a graduate and stop them using social networking, what you are essentially doing is shutting down their trusted networks. It’s like telling them not to send an e-mail or make a phone call.”
HR and flexible working
Sociologist Caroline Gatrell, of Lancaster University Management School, predicts that organisations that don’t address flexible working will lose out significantly on talent in the next two decades.
“Opportunities to work flexibly rarely extend further than part-time working and are often more readily available to mothers than fathers,” she says. “What’s more, the notion of flexibility has become an excuse, when it comes to full-time employees, to actually expect people to work longer hours, with bodily presence being almost a pre-requisite for promotion to executive levels.”
The result, she explains, is that mothers will continue to be disadvantaged in terms of pay and promotion because the notion of flexibility is interpreted by employers as justification for placing working mothers on the ‘mummy track’. Meanwhile, fathers’ workloads will intensify further and full-time employment will continue to be associated with masculinity.
Gender issues aside, Peter Thomson, director of the Henley Future Work Foundation, believes that in 20 years, employees will be treated in the same way that self-employed people are treated now. “All individuals are going to look for better work-life balance and they will become more demanding about it. In 20 years’ time, people will not expect their employer to tell them where they have to be at 10am on a Monday morning unless it is genuinely essential for the task in hand. They will consider themselves as intelligent adults who can get their job done when and where they want to. HR will be helping managers to measure people’s output, not their input.”
Retirement at 65 will also become a thing of the past, adds Thomson. “People might not stay in the same job, though. Already in the US we are seeing people take a step down from a fairly senior job into one with a slower pace as they get older, without the concerns around job status that still exist here.”
HR and skills
Linda Holbeche, research and policy director at the CIPD, points to the 2012 Olympics being a prime example of an external event that will help shape the future of HR. “The 2012 Olympics is a short-term focus that illustrates the increasing trend towards bringing organisations together to develop a major project,” she says. “For HR, the issue is going to be how to drive a different skills requirement than they’re used to, both in terms of those managing it and those working in major collaborative areas like transport – as well as ensuring that the skills are reabsorbed after the event itself. Indeed, I think 2012 is illustrative of a future where skills requirements are going to change at a very fast pace.”
She adds that the chronic and growing skills shortages we face today will keep HR busy for some time to come. “A lot of companies are struggling to get the talent they need and HR is having to come up with all sorts of ingenious ways to help solve the problem – like bringing in overseas workers. I think that in the West, with our current pace of economic growth, HR will have a real struggle on its hands in terms of growing talent fast enough over the next five to 10 years.”
The recent launch of A-level equivalent qualifications by employers is a sign that organisations are going to increasingly ‘grow their own’ talent, she says. “The government will no doubt continue to think and rethink about school-leaver qualifications but HR will not be resting on its laurels in the meantime.”
If the economy does fall into a recession, it will force HR to look more closely at the skills the organisation already has, says Thomson.
“The big change in future recessions, compared with past ones, will be that HR becomes much more involved in enforced downshifting as an alternative to redundancy. In a climate where talent is increasingly recognised and where multiple jobs are more common, it will be a case of, ‘We still want you to work here, but we can only afford to keep you for three days a week.'”
HR and legislation
While the law has been a thorn in the side of HR in many ways over the past 20 years, the CIPD predicts employment legislation will slow down over the next two decades. “There will be a major thrust to simplify employment legislation as opposed to piling on yet more,” says Holbeche. “There is genuine recognition of the fact that we currently have an burdensome regime that’s over-litigious and we are getting far too many employment tribunals.
Partly driving this change, she believes, is a shift towards a more active and genuine partnership between trade unions and HR. “This partnership is already starting to work really well in the airline industry, where both parties are open with each other from day one and work together in a far more grown-up way than the past,” Holbeche says.
Michelle Singleton, policy assistant at public services union Unison, agrees. “You only have to look at work-life balance as an area where unions and HR are working well together across many sectors. Soft issues like this that mean a great deal to employees are areas where there is no haggling about money and less scope for coming to blows. We are seeing far more negotiation between HR and unions and the dialogue could expand into other, harder areas in the next 20 years.”