by Michael Abramow, September 2013
Over the past few years, changes in technology have dramatically changed the way employers and employees want to interact. Gartner describes these changes as a “Nexus of Forces”—a convergence of social, mobility, cloud, and information that empower individuals to interact through technology. This not only changes what we connect, but how we connect and transact, and it is critical for human resources (HR) departments to embrace these trends.
According to PwC’s “The New Digital Economy” survey, failure to do so can negatively impact staff retention as well as stifle business growth and productivity. eMarketer estimates that 72 percent of the total population by 2015 will be using mobile phones, while Juniper Research says mobile payment transaction volume will reach US$630 billion by 2014. Gartner estimates that global public cloud computing will grow from US$68.3 billion in 2010 to US$148.8 billion by 2014. And according to the 2012 AIIM Report, two-thirds of businesses are now using social technology for business related functions.
Despite the dramatic technology change in the marketplace, HR is often impeded by a mindset and culture that traditionally resists new IT projects. According to a Human Capital Institute study, HR professionals have an inherent distrust of IT stemming from a risk mitigation and compliance orientation. But by doing nothing, the real risk is that a company will sacrifice organizational agility, accelerated decision-making, and increased collaboration, according to the Aberdeen Group.
HR is often impeded by a mindset and culture that traditionally resists new IT
So how does HR balance the need for embracing technology while mitigating risk?
- Encourage executive buy-in. HR should encourage business leaders to evaluate tools they think will work in a business context, while providing only enough support to ensure there are no uncontained risks. Common areas of risk include legal and copyright compliance, IT security, intellectual property leakage, privacy, and brand/reputational damage. CEO of ANZ Bank, Mike Smith stated in the Australian Financial Review that he has now started communicating with his staff via LinkedIn. “To me, it had always been a nuisance value and I did not truly appreciate what the social network could offer.” Acceptance of these tools from the top of the organization has a flow-on effect on how employees both utilize and consider them to be appropriate in a work context.
- Be tolerant of IT failure. Acceptance of failed technology projects is changing the way companies approach innovation. Credit-card company Capital One continually conducts large numbers of technology experiments knowing that while some of the projects won’t pay off, even the failures will provide valuable insights into customer and employee preferences. Constructive failures made in pursuit of a better means of undertaking business tasks should be communicated as opportunities for enhancing learning, growth, and employee satisfaction. Being dismissive and adopting a sink-or-swim culture causes employees to be dissuaded from investing time, money, and resources in evaluating what could be transformative technologies.
- Invest in risk education. A 2010 Strategic HR Review article suggests that HR employees need training on the benefits of risk-taking; how to take risks, what kinds of risks to take, and when to take risks. With technology, risk can be safely managed by launching trial or proof-of-concept programs. For example, Cloud vendors can offer free 30-day trials of their SaaS products. Social media applications can be piloted in a closed group to protect a company's public brand image and provide the ability to moderate language and comments. And large software vendors can offer free trials of their mobile solutions, providing a low barrier to entry. Training and well-communicated guidelines can help mitigate any brand or reputational concerns when balancing the risk vs. reward argument.
Michael Abramow is director of Industry Strategy and Insight at Oracle.
- Develop an HR technology strategy. HR leaders should outline guiding principles for assessing new technologies and for managing a portfolio of tools that are tied to the overall business strategy. The HR technology strategy can further define success criteria for your technology, identify short- and long-term implications, and provide plans for risk mitigation.
By leveraging these approaches, HR professionals can jumpstart and safeguard their own path towards IT progress. But no matter how great a company’s systems and processes, they will amount to little in terms of business transformation if leaders do a poor job of communicating with employees and customers.