The technology boom in the last 20 years has seen a drastic change in the way we lead our lives and work. However, the coming years promise a technology induced disruption like none other. The current buzzwords of AI, VR, Blockchain and gig economy are pushing businesses to take cognizance of technology and its effect on their future.
The recently concluded series of SHRM India forums in Bengaluru and Delhi threw spotlight on the transforming landscape of economy and technology. The event saw highly interactive discussions on the current and future trends in technology, the presence of the millennial workforce, the advent of the gig economy and the consequent impact of all of these aspects on HR's future.
The Bengaluru event was presided by seasoned industry professionals like Mr. Ajay Gachhi, Principal Director - HR Strategy & Transformation at Accenture; Mr. Arun K. Misra, Vice President-HR at Aditya Birla Group and Mr. Faraaz Farshori, Solutions Architect - Human Capital Management Applications Expert at SumTotal Systems, a Skillsoft Company.
The Delhi event was chaired by industry stalwarts like Mr. Annmol Bhutani, Country HR Head at Keysight Technologies; Mr. Jaspreet Bakshi, Director & Regional Head, HR People Services India, RBS; Mr. Neeraj Narang, Director - HCM Product Strategy, Oracle and Mr. Vivek Mukherjee, Head of Human Resources at Benetton India.
Here are the key excerpts from the conversations that took place in both the Bengaluru and Delhi forums.
The Current Trends in Technology
Popular buzzwords like the Internet of Things (IoT), Artificial Intelligence (AI), Virtual Reality (VR) etc are all life altering technologies that have begun to touch our lives. It will not only change how we use gadgets around us, but it will change our work environment, our nature of work and lives.
Technology is changing many industries. For example, Atom Bank has brought banking to smartphones. It has no physical outposts and works through an app. It provides normal banking benefits like loans, mortgage, funds to customers and has an 18% market share in the UK. It's workforce of 35 employees is disrupting banking in Europe.
Digital transformation is already underway for several organizations. It is integrating technology into all business processes. This in turn will affect the workforce into changing their ways of working and adapting to it. For example, a VR tool helps Axis bank give its future employees a tour of their offices. Many other companies are also deploying chatbots for employee engagement.
Technology provides the agility that is needed in the new gig economy.
What is The Gig Economy?
In a gig economy, temporary positions are common, and organizations contract with independent workers for short-term engagements. Freelancing work on websites like Freelancer are an example of this. At the centre of it, there is a buyer, a seller and a short-term fixed-rate relationship unlike the current employer-employee relationship.
With global crises like the oil crisis, financial crisis etc., striking us in the last 20 years, we can say that we live in a world of uncertainty. These can also be called the VUCA times (Volatile, Uncertain Complex and Ambiguous) and are said to be further augmented by SMAC (Social, Mobile, Analytics and Cloud) environment. In this gig economy, technology will provide the necessary agility to businesses.
Mckinsey's recent paper on the Gig economy mentioned that there are 162 Million people in the global workforce who are part of gig economy. This accounts for 25% of total workforce. In future, this percentage will further increase. Hence traditional worker-employer contracts won't work in the future. And more people will be working through a contractual mode than ever.
The Presence of Millennials and the Gig Economy
Millennials have been characterised by their thirst for instant gratification and constant exploration in this new world. More restless and less on patience, millennials' expectations will urge HR to find ways of managing them effectively.
To retain millennial workforce, HR needs to adapt themselves to answer their needs. The following 4 elements when implemented will help in breaking ice and enhance engagement with the millennials:
- Presence of challenging tasks for learning and growth
- Engagement with the millennials giving them a chance to express themselves
- Understanding the expectations of this group
- Feedback from them for the future
Millennials believe in flexibility of job, organization and location. They want to learn faster and grow. Gig economy is just an extension of these millennial expectations. Gig Economy is a manifestation of the individual needs of not wanting to be restricted to one place, one project or one company. As it will redefine the talent landscape, HR will have to gear up to harness the opportunity that the gig economy provides.
The Impact on HR due to the Change in Landscape
In the technology driven gig economy, the question is about HR's survival and role thereafter. While HR will not be obsolete, it will have a change of role. The transactional nature of HR's role will change. HR will have to outsource the transactional part of their jobs to technology and this will give them time to get involved in employee engagement and other strategic roles such as transformation. For example, HR will engage with job candidates to delve deeper for identifying the right candidate with precision instead of just taking care of the hiring process. With the help of technology, it will become instrumental in giving visibility to the pain chains in the system and thus aid their solution. It will help the HR improve efficiency within organizations.
In fact, SHRM Competency Model that lists out 9 competencies required for HR professionals has only one competency which is in the realm of HR's functional knowledge. The rest of them are about behaviour. This shows that it is the other behaviours apart from functional expertise that can define success for an HR professional.
Additionally, World Economic Forum's report in 2015 said that the top three skill sets required are creative thinking, critical thinking and how they relate to the business model of the organization.
What Should Organizations Do?
Change has been constant throughout history. As business requirements have changed, HR has changed with them. HR will need to change to answer the three questions posed by the gig economy. These questions are of Aspiration, Ambiguity and Anxiety. The new technology however aspirational for the young workforce, poses ambiguity about the future. As contractual roles increase, more people will work from home. This will change the communication pattern and work culture within the company which in turn can bring anxiety for management. HR needs to be prepared to deal with these 3 elements.
Organizations should also remember that today they have 3 types of contracts with the employees -psychological (emotional bonding with employee), social (the social interactions between employees at work) and economic (salary). Modern technology will change this.
The changes will affect not just millennials but various generations of employees such as Baby Boomers, Generation X, Generation Y, Millennials and Seniors. As psychological contracts will be affected due to change in work culture, employees will require mentoring and peer level coaching instead of just work-related training. Displacement of jobs although temporary, willtake place. As automationincreases, workspaces will not be about emotions because machines don't understand an employee's situation. This enhances the role of HR as an emotional soundboard. The new workforce will have millennial aspirations which will lead to a change in the style of recognition and engagement suited to the gig economy.
They will thus help augment the core values of HR. HR will add value to business in its core ways of working with people, enhancing organizational culture, augmenting mentoring and partnering with business. Talent Management at different stages of the employee lifecycle will be necessary in this world. These are -
1. Scouting for Talent
Technology is altering the landscape at this stage. HR technology traditionally has been used for transactional activities like finding candidates from job portals. But some companies are going ahead and using AI tools to sift through relevant resumes. This reduces the time lag from hiring to onboarding.
2. During interviews
Bots will streamline the interview process in the near future. They will automatically send messages to interviewee about the interview location, job details and point of contact while already informing interviewer on the interviewee's background. It will save time and increase HR's efficiency. In fact, an unnamed Big 4 company has already deployed robots for their onboarding process.
3. Helps Employee Engagement
With the help of AI and chatbots, HR can collect the employee Information on their productivity, attendance etc, and run predictive analysis to learn more about the workforce. This information will help them in improving their connect with the employees.
However, there are challenges in enhancing engagement in a gig economy. These are -
- Legal - compliance and regulatory matters which HR has no control over.
- Social - Social acceptance of contractual employees and their image is something HR cannot control.
- Organizational Readiness - HR Tech tools can help organizations in measuring employee effort. A performance management system that is not too complex will work better in a short-term contract-based job.
In the end, it is worthwhile to remember that HR's role is contextual. In India, 47-48% employment is provided by families through unstructured business. The tech buzzwords might not make sense in that context. Hence, while technology will provide change, not all organizations will be gearing up to AI at the same speed. The changes will happen over a period of time and accordingly lead to HR evolution. HR will need to rise up to these changes as per organizational requirements.