Of All a Company’s Functions, HR Is the Guardian of the Future

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Apr 23, 2015

Editor’s Note: This is the second of 12 essays from the new book, The Rise of HR; Wisdom From 73 Thoughts Leaders. It’s compiled by Dave Ulrich, Bill Schiemann and Libby Sartain, and sponsored by the HR Certification Institute.

By Lynda Gratton

The forces shaping our world are having a profound impact on organizations and on the HR professionals within them.

That is why over a decade ago my colleagues and I founded the Future of Work Research Consortium (FoW). Our aspiration was to engage with HR people from around the world to consider the forces that they believe will shape their function and the roles and responsibilities within it.

Many changes driving the working world

More than 80 corporations, NGOs, and government think tanks have been involved in this joint exploration of the real changes that are taking place and how corporations can best adapt to them.

It is clear that the forces of technology and globalization have shaped business models and will continue to do so. Take, for example, one of our FoW members, Tata Consultancy Services.

A decade ago, their business strategy of high-impact, medium-cost IT support and consulting would not have been possible. Yet today they have the technology and the culture to link more than 300,000 employees in hundreds of fast-paced learning communities, enabling them to meet their clients’ needs with speed and scale. What is clear is that this scale of mobilization is only possible now.

It is not just the forces of technology and globalization that are shaping our world. Workforces are impacted by intense demographic trends as working lives elongate and family size decreases.

They also operate under the shadow of resource constraints and climate change that will have to be addressed in the coming decades. We can expect that the very forces that are shaping business models will have a profound impact on the HR strategies, practices, and processes that support them.

So what does this mean for the future of HR?

Building collaboration insight

The primary design principle emerging from the forces of technology and globalization is collaboration. We now have access to the technological might to connect many millions of people — and the potential is there for them to engage in highly effective communities, sharing information and solving problems.

But, as many companies have found, while the technology can be an enabler to speed and innovation, it is often the culture of the company that acts as a barrier to collaboration.

Culture — the norms of behavior and general expectations of performance — is fiendishly hard to shape or control. Yet what we have seen in many companies is that the HR practices and processes often inadvertently create a barrier to collaboration and innovation.

Misaligned remuneration systems, poor executive role modeling, unclear job design, and poorly managed teams are all barriers to the extraordinary potential of collaborative technology. They are also practices and processes within HR’s sphere of influence. Making changes to these practices is hard — but crucial.

Cultures of collaboration

This is why I believe that it is imperative for the HR profession to have deep strategic insight into the role that practices and processes can play to support a culture of collaboration.

The strategic understanding of the alignment between business goals and HR practices and processes was the centerpiece of Living Strategy, one of the first books I wrote for the HR community. A decade later, this is as important as ever. It requires understanding the organization as a system, working through the levers that have the greatest influence on culture, and then having the courage and commitment to change those that are a barrier and strengthen those that are potential enablers.

Understanding how cultures of collaboration are built is a crucial capability for HR professionals. Moreover, measuring the current state of collaboration can bring real understanding.

It seems to me that the research and insight from network theorists can be of significant use to us. Their research has highlighted the importance of weak ties, helped us understand the role of boundary spanners, and taught us a way of thinking of companies not as organizational charts of power but as networks of influence.

Understanding how networks operate

That is why, in my executive human resource strategy program at London Business School, I now partner with my colleague, Professor Raina Brands, to support each participant in understanding more fully their personal networks of influence.

Take, for example, a senior HR member of a rather traditional bank. Her hope was to influence the senior team to act more collaboratively. But when she looked at her personal influence network, she found that most of her strong relationship ties were with other members of the HR function. In working so much to support her HR peers, she had failed to reach out to her business colleagues and to really invest in building those relationships. As a result, she had little traction when it came to influencing them.

What the participants discovered was that understanding more about how networks operate can be a significant tool for them, and one they can take back to use within their companies.

Yet while technology and globalization are reshaping corporations and work, there is another force that is beginning to be felt. Across the world, through a combination of healthier lifestyles and medical advances, many people are expected to live a great deal longer than their parents or grandparents.

Prepare for longevity

My colleague, the economist Andrew Scott, and I are fascinated with this and have spent the last couple of years studying what happens when many people live to be 100.

What we have found is that the impact is felt across the trajectory of a lifetime — from young people who want more time to explore, to those in their 30s wanting to make a significant transformation, to those in their 50s wanting to build a new portfolio of work. Our economic modeling and development of various scenarios shows that for most people, an important result will be long working lives, with people remaining in the workforce into their 80s.

Those working for so long will want engaging, meaningful work; the capacity to take breaks to recuperate and learn; and the support to build valuable skills to prepare for portfolio stages in their career. Many will want balanced family partnerships to help shoulder the financial burden of longer lives.

That means both men and women will want more flexible ways of working. The scenarios we modeled for future careers often contained many more stages and a great deal of variety as people forge their unique pathways.

Yet our initial research into current corporate practice showed that few HR teams are fully aware of the implications of longevity and are still basing their people practices on the traditional three-stage path of education, work, and retirement. It seems to me that a crucial HR capability going forward will be understanding the implications of longevity and how best to create an environment in which people can work a great deal longer, rather than retire at the age of 60.

That means doing away with many of the stereotypes about the “over 60s,” and disconnecting pay and service so that older people are more economically attractive. It means establishing strong mentoring roles and creating opportunities for work to be part of a broader portfolio of activities.

Consider climate change

One of the consequences of globalization has been a depletion of natural resources and unpredictable weather patterns. For many companies, particularly those with extended supply chains, these new realities are increasingly hard to ignore and indeed are often a risk to them.

In thinking about these consequences, Unilever CEO Paul Polman set the goal of reducing the company’s carbon footprint by 50 percent. He tasked the HR teams with understanding how this goal could be met.

Their first project was to analyze carbon use across the company. What they quickly discovered was that much of the carbon created within the company and in the supply chain came as a result of traditional work practices: moving employees around on multiple flights, putting employees to work in centrally located offices, and encouraging them to commute every day into a city.

Changing these work practices proved to be a tough but rewarding process. It also brought a higher level of flexibility and encouraged managers to think more creatively about how they supported virtual working and performance management.

More and more CEOs are as engaged as Polman in the debate about climate change. Some are also determined to make a difference. What is clear is that the HR function has a key role to play, both in understanding where carbon is created and in reshaping work practices to ensure that it is significantly reduced.

Making multi-stakeholder alliances work

What Polman and his colleagues have realized is that making change at the level of the globe requires an understanding of how to make multi-stakeholder alliances work. In a sense, this is the most complex extension of the collaboration challenge I referred to earlier. There are many stakeholders with an interest in climate change — governments, NGOs, citizens groups, employees.

Bringing these disparate interests together is tough, but as I argued in my latest book, The Key, it is corporations that can make this happen. Of course, this takes me back to my opening comments about collaboration. It is only through collaboration that corporations can become a force for good—and the HR function plays a key role in building a context in which collaboration can flourish.

So what does this all mean for the way we structure the HR function?

3 simple suggestions

There are many others much better placed than I to comment on this. But I would make these simple suggestions:

First, let the HR function be a guiding light on how the corporation as a whole should function. Model collaboration, work with ease across boundaries, and use network tools to understand and build communities of practice.

Next, appreciate that multi-stakeholder decision-making will be increasingly important, and that the way that the function approaches sharing ideas and engaging others in change should follow this.

Finally, realize that of all the functions in a company, it is HR that is the guardian of the future — and it is HR that must continuously imagine what the future could bring.

Compiled by Dave Ulrich, Bill Schiemann and Libby Sartain, and sponsored by the HR Certification Institute, The Rise of HR: Wisdom from 73 Thought Leaders is an anthology of essays addressing the critical issues facing business and talent professionals today. The full eBook can be downloaded @ Reprinted with permission of HRCI.