Embarking on a journey of digital change

Findings from the global HR New Reality survey

John Doel

John Doel

Principal, Human Capital Advisory, KPMG US

+1 503-820-6471

Roni Kopelman

Roni Kopelman

Director, Human Capital Advisory, KPMG US

+1 614-249-2300

The C-suite’s reliance on HR during the pandemic showed that it sees human capital as its most valuable asset and key to resilience in an uncertain future.

While this presented the HR function with an opportunity to stop passively carrying out administrative duties, it’s now time to switch gears and play the long game to strategically engineer a successful future. This means a change in HR focus: thinking big and exploiting data, analytics, artificial intelligence, and machine learning to drive systemic change, engage the workforce, and create positive employee experiences. For those HR functions that take the long view, the rewards are great—they have the opportunity to reinvent work and drive value.

According to the KPMG 2020 HR New Reality pulse survey, two-thirds of HR executives believe the HR function must be reinvented.

Become a strategic partner

To succeed in an environment of exponential change and an accelerated pace of digital innovation, it’s essential to tie HR to business outcomes. This means the HR function must redefine traditional work models and evolve in terms of roles, capabilities, and digital enablers. As the role of the HR Business Partner evolves toward a strategic consultant, organizations will need to provide them with the digital tools and insights for data-driven decision-making.

With nearly four in five CEOs and EVPs saying the HR function needs to completely reinvent itself to respond more effectively to future disruptions, HR transformation should be prioritizing digital enablement as a central focus of their modernization initiatives.

Liberate the HR function

HR is often hindered by disparate software, systems, and tools that are heavily dependent on manual intervention. By transitioning to an ecosystem of applications that connect data from across the business, HR can gain greater agility and make more informed decisions. Add to that automating administrative and highly repetitive tasks, HR can free up resources to focus on longer-term activities such as shaping organizational culture, building the workforce of the future, and addressing people needs—particularly in critical areas such as diversity and inclusion.

Taking an evidence-based approach is still vital

Conducting workforce forecasting and managing performance and productivity continue to rank among the top five skills required by the HR function, with applying analytics and data science now shown as a much lower priority. Such a stance could be a costly oversight. In fact, 54 percent of non-pathfinders say their HR organization is not proficient in using data and analytics to target and recruit their future workforce.

Furthermore, while current technology may address today’s demands to support learning and remote working, it’s essential to monitor and make future decisions based the impact of those efforts. Only with workforce analytics can those decisions be made. Data and analytics can also help HR identify which activities to automate and what skill gaps need to be filled through new hires or partnerships.

Applying analytics and data science is a prerequisite to conducting workforce forecasting and most any evidence-based decision that HR needs to make. Shifting to this approach is vital for the HR function to ensure it is focused on activities that deliver the most value and to demonstrate that to the wider business. 

Reinvent for success

To achieve a successful reinvention, HR must change its mindset. Those HR functions that embrace analytical insights, digital tools, whole workforce shaping, and purpose-driven practices will have the opportunity to reinvent work and drive value in the post-pandemic enterprise.

To explore these insights, visit The Future of HR in the New Reality.