Employers urged to boost HR technology

Organizational redesign is everywhere, but human resources departments aren’t ready to handle it, a new study from Mercer has found.

While 93 per cent of executives are planning structural overhauls, only a third (35 per cent) employ a service delivery model that includes the three components Mercer suggests are necessary for excellence: centres of expertise, business partners and shared services.

Read: Cost savings top driver for benefits technology use: report

“Organizations are making changes in the interest of greater efficiency and increased agility, which requires a combination of technologies,” Ilana Hechter, partner and leader of talent strategy and transformation at Mercer, said in a statement. “Those that have been expanding shared services and business partnering skills have had the best success aligning HR to business needs.”

But even so, only 17 per cent of companies plan to update their existing model.

To prepare for the future, human resources departments should invest in technology for managing human capital, the report suggested. Especially important are tools that provide workforce analytics and can offer a consumer-based experience for both managers and employees, according to Mercer. Nevertheless, just 35 per cent of chief executive officers said their human resource offering provides digital experiences.

Read: 40% of organizations don’t have an HR analytics strategy

The study also found companies with high-performing tools achieve better business outcomes, such as delivering exceptional customer service (94 per cent) and driving innovation (89 per cent).

“As HR functions adopt technology and advance their skills in data analytics, they are strengthening strategic decision-making, enhancing partnerships with business leaders and other functions and providing a more digital and consumer-oriented manager and employee experience,” said Hechter.

But for now, there are limited numbers of technologically savvy companies when it comes to human resource functions. While 69 per cent of organizations offer employee self-service, only 36 per cent do so for managers.

Read: HR going from in-house to out-of-house