Here are six trends that are set to disrupt human capital strategies in 2021.
Consumerization of HR, changing workforce demographics and an acute shortage of talent call for innovation in human capital strategy. We look at the top six human capital management trends that will shape 2021.
Given how competitive and complex the modern job market is, 2021 will witness seismic shifts in how companies attract and retain talent. Millennials represent the largest workforce demographics and crave smart, effective and meaningful engagement. HR leaders will now increasingly look at technologies such as analytics, AI, and virtual assistants to transform HR. Here are six trends that are set to disrupt human capital strategies in 2021.
1. AI and Machine Learning
AI and machine learning (ML) are already impacting businesses across various functions. Granted, this isn’t a new development (there are several point solutions available that leverage AI capabilities); however, what’s changing is how AI and ML are being deployed to improve HCM practices.
From AI-powered chatbots to intelligent automation, HR teams can now rethink their approach to recruitment, employee engagement, and L&D modules by tracking massive amounts of incoming data, automating repetitive processes, and incorporating conversational and interactive interfaces across every touch-point.
2. Blended Workforce Management
The modern workforce is a blend of full-time employees, part-time employees, contract workers, and freelancers. This means that HR must leverage new tools and technologies, to reach out to talent across the board, regardless of location, background, and ethnicity. Whether contractual or full-time, recruitment will now rely heavily on referrals, employer brand building, social media utilization, and online searches.
3. Integration and Collaboration
The various functions and divisions of HR can no longer work in silos. HR teams must introduce cutting-edge solutions and platforms which integrate the various functionalities into a single, comprehensive dashboard. This will improve visibility, offer greater tracking mechanisms, build insights, and strengthen decision-making.
“There’s certainly an appetite for joined-up HR, L&D, and business technology, but HR professionals aren’t clear on how to go about achieving it. Fortunately, the growth in usefulness, popularity, and openness of APIs means it is quicker and simpler than ever to achieve useful, fully automated integrations and data syncs between core HR software and other applications,” says Rob Oehlers, Head Of Customer Experience at CIPHR. This type of unified human capital strategy is already in place across several large-scale enterprises and will make deeper inroads into the SMB space in 2021.
4. The Rise and Rise of Big Data Analytics
“Feedback, engagement, and analytics tools reign,” says industry analyst Josh Bersin speaking about HR in 2021. “Only a few years ago the engagement survey market was a robust but sleepy place. Today it has become a dynamic world of real-time survey systems, sentiment analysis software, organizational network analysis (ONA) tools, and products that actually automatically ask your peers for feedback to give you real-time coaching.”
As more and more data pours in from digital platforms, HR teams are finally at a place where they can use analytics to transform how employee engagement, retention, L&D, and other areas function. This will help build a data-driven culture across organizations.
5. Increased Focus on Compliance
Today, there is a greater focus on data security and privacy management, coupled with the need for stringent policies around pay equity, transparency, and workplace harassment. Regulatory compliance will be crucial for HR teams dealing with employees spread across different locations, where local laws will vary from place to place.
HR teams must partner with the right solution providers and deploy cloud-based human capital strategies, to boost security, data protection, and regulatory adherence.
6. A Mobile-First Approach
Regardless of the task at hand - recruitment, onboarding, benefits, payroll, or rewards - all HR initiatives must be mobile friendly. Younger generations like the Millennials have come to expect the same ease of accessing technology at the workplace, as they experience in their personal lives. HR managers must focus on making the entire employee journey more interactive, conversational, and impactful. ‘On-the-go’ and ‘UX’ are buzzwords that will shape 2021 HCM strategies.
These are the six major HCM trends that we can expect to observe in 2021. Each one of these trends signifies the fundamental transformation of human capital management. Contemporary HR departments must create a strategic blueprint for tomorrow’s workforce, in line with larger business objectives.