HR Has a Chance to Reach Full Strategic Potential — But Will It Seize the Day?

For some years now, HR has been on a journey toward the strategic center of the business. At times, this journey has been slow. Today, however, we finally stand at a point where HR is thinking in terms of business strategy and corporate leaders are increasingly turn to their HR teams for help growing the overall business.

However, some significant barriers remain in the way of HR realizing its new strategic role — barriers that can best be overcome through a new approach to recruitment.

The Business Is Ready to Make HR a Strategic Partner

As HR shifts focus from enabling back-office effectiveness to becoming a strategic business partner, it is pushing on an open door. In a recent Accenture survey, we found that not only are HR teams thinking strategically, but the business side of the house values HR activities as key drivers for meeting its own goals as well.

According to our report, today’s HR leaders see business priorities like profitability and competitiveness as their main concerns. Moreover, other executives are recognizing how important HR’s efforts are to meeting such challenges. For example, almost two-thirds of all business executives named reskilling — traditionally HR’s domain — a key strategic priority, putting it on par with other important enablers like risk mitigation and the use of cloud technology.

The need to attract top talent through recruitment also stands out as a prominent concern of business leaders across the board. When asked about their priorities for transforming various business functions, executives ranked talent acquisition (64 percent) almost as highly as they ranked IT application maintenance and development (65 percent), the most widely cited transformational priority among all executives. Businesses today are clearly on the lookout for transformational approaches to the attraction and retention of talent.

In most organizations, however, HR has yet to fully realize its strategic potential. A number of reasons account for this fact, including an underappreciation by some HR practitioners of key enabling technologies such as artificial intelligence (AI) and automation.

Two Barriers to HR’s Full Potential

Two of the barriers to HR’s full potential relate specifically to recruitment. First, there is a perception among business leaders that HR is slow to change. The Accenture survey asked participants to estimate how much change has taken place over the past 18 months across a range of business functions. Talent development and recruiting sat at the bottom of the list. At a time when business is changing at a blistering pace, HR will need to alter this perception if it is to maintain relevance.

The second barrier has to do with digital skills. Enterprises today are crying out for employees with high-level digital skills so they can make the most of opportunities around data analytics, AI, and machine learning. However, HR teams do not appear to be as concerned about these skills gaps as the wider business is. Just 41 percent of HR pros expressed concern about having enough people with the right high-level digital skills on staff, compared to 54 percent of all business executives. Similarly, 56 percent of executives want more people versed in digital business models, but only 46 percent of HR pros see that as a pressing need. These findings suggest businesses need skills that HR does not acknowledge or have the resources to address.

If HR is to overcome these barriers, a transformational approach to recruiting is required. Here are two first steps HR teams can take to ensure their recruiting processes deliver against their new strategic responsibilities:

1. Break down silos and create agile workforces: At most companies, the HR department manages permanent staff while procurement manages contractors. Meanwhile, outsourcing companies own the data for payroll and benefits. As HR leaders strive to use analytics to predict workforce needs and create more agile workforces, they will need to unify and own all these processes, technologies, and partners.
2. Aim higher when it comes to reskilling: Enterprises need HR to prioritize high-level digital skills. Even when budgets are tight, HR teams need to make the case for more investment to ensure they can develop the digital skills the business needs to grow. A business-relevant HR function will be best placed to build a more business-relevant workforce.

With the business environment moving so fast, HR leaders need to recognize the urgency for action. Fortunately, everything they need to become more strategic and help create a workforce for the future is at hand. All that remains is for HR teams to grasp the opportunity.

Jill K. Goldstein is talent and HR business process services lead at Accenture Operations.