According to recent APQC research, 85% of HR departments are currently restructuring or planning to restructure in the next 2 years. Their top objectives are to improve HR’s use of technology, better align HR with the business, and increase HR agility and automation.
“Our research identified specific barriers that threaten HR’s ability to meet objectives,” said principal research lead Elissa Tucker. “The top four barriers to better HR are: business leaders being too focused on cost; HR employee skills gaps; business resistance to HR change; and business leaders not understanding the value of HR. Fortunately, our research also indicates a path forward.”
A subset of the 208 HR organizations in APQC’s study provide a model for making improvements. Without spending more or adding staff, these best-in-class HR functions achieve higher levels of HR customer satisfaction, employee engagement, revenue per employee, and lower voluntary turnover.
Survey responses revealed significant differences in how the best-in-class handle: HR strategy, structure, staffing, process, technology, and analytics.
“The best-in-class appear to do a better job of evolving their HR practices as business needs and technology change,” said Tucker. “These best-in-class HR practices provide steps that other HR functions can take to improve their own performance.”
- Leveraging HR business partners, centers of excellence, and HR shared services.
- 72% of best-in-class HR functions use centers of expertise compared to 55% of all other HR functions, while 61% use HR shared services compared to 35% of all other HR functions.
- Standardizing, integrating, and automating HR processes.
- 79% of the best-in-class have highly automated HR processes compared to 44% of other HR functions.
- Making alignment with processes a key factor in HR technology purchase decisions.
- 90% of the best-in-class strongly consider fit with existing processes when purchasing HR technology compared to 57% of other HR functions.
- Providing robust HR development across all HR career stages.
- 54% of best-in-class offer early-career HR development compared to 30% of other HR functions, while 52% offer leadership development to current leaders compared to 35% of other HR functions.
- Using predictive and prescriptive analytics to make HR and workforce decisions.
- 86% of the best-in-class use predictive analytics compared to 49% of other HR functions.
APQC’s research also revealed ways that even the best HR functions can improve:
- Close HR skills gaps in analytics, cost management, HR expertise, and change management.
- Devote more resources to HR change management.
- Mature AI capabilities and applications.
- Leverage process and technology to improve accuracy of HR data.
- Use measures and analytics to prove the value of HR investments to business leaders.
APQC is the world’s foremost authority in benchmarking, best practices, process and performance improvement, and knowledge management.