Reskilling Human Resources: Is This the Big Thing for 2014?

The answer to that question is “yes,” as indicated by a number of events so far this year. Deloitte produced a study that was not a particularly good report card on HR. I wrote about this in another blog post called Future Friday: Why the future of HR is so grim! And SHRM (The Society for Human Resources Management) recently announced that they are instituting a new certification system that focuses on their HR competency model, and they are dumping the HRCI certifications of PHR and SPHR. But we won’t focus on that here; rather, we’ll look at the Deloitte study to learn why HR needs to “reskill” itself.

A Lack of Communication

There is an old Paul Newman movie called Cool Hand Luke that has a very famous line that goes, “What we have here is a failure to communicate.” The Deloitte study points out that HR departments today are failing to communicate with the CEOs of their organizations. Deloitte polled CEOs and CHROs to ask key questions about how ready their companies are to deal with people challenges. There was a pretty wide disparity between the answers given by the CEOs and those provided by the Chief HR Officers.

Here are some of the results:

• When asked if they were ready to take on problems having to do with leadership, 40% of CEOs said they were not, but only 28% of CHROs agreed.
• The question of whether HR needs to be reskilled was answered “yes” by 48% of CEOs, who said that HR is not ready for present and future skill challenges. Only 36% of CHROs agreed.
• To the issue of global HR and talent management, 45% of executives said that their organization was not ready, and 27% of HR reps agreed.
• Retention and engagement was raised as a red flag by 38% of executives and 27% of HR professionals.
• And the question of readiness to use HR and talent analytics got a “no” from a huge 57% of execs, compared to 41% of HR pros.

As you can see, there is a large difference in opinion about HR’s readiness to handle the challenges that companies will face not just in 2014, but for the decade to come. Does this truly speak to just a lack of communication, or does HR really not have the skill sets that are necessary to be successful in the near future? If CEOs were asked, they would most likely answer the latter.

Why the lack of skills?

The Deloitte study asked this question, and it found that the answer has two parts. First, many HR professionals don’t have the business education or certification necessary to be effective in today’s business world. Some 70% of HR come into the profession untrained. SHRM has long recognized this shortfall and does provide education about business processes during its certification process. However, this has fallen short of the need. Perhaps that is why SHRM is changing the nature of its certification process.

In my opinion, one of the major reasons for a lack of skills in HR falls into the lap of the CEO or CFO who hires the Chief Human Resources Officer. CEO’s apparently know how critical these skills are, and yet they hire people without the necessary skill sets. If that’s the case, they should not then complain when their HR staff does not know how to handle the job.

HR is a tough job. And, according to Deloitte, it requires a lot of skills and a strong understanding of:

• Recruitment, training, employee relations, organizational design, and compensation and benefits;
• Labor market trends affecting recruitment at the local, national, and international levels (when applicable);
• Service quality improvement through the design and implementation of innovative technologies;
• Analytics and technology that relates to the field;
• Industry trends, including how to improve company profits, handle competition, and encourage innovation;
• Management and leadership skills.

That is a pretty hefty list. Yet companies spend less than $500 per person in HR to improve their skills.
I would also guess that most HR departments are understaffed since many CEOs are reluctant to spend money on developing something that many of them don’t seem to place much value in.

How do we fix this?

Deloitte has some suggestions for how organizations can fix their HR skills dilemma. They suggest:

1. Spend more money on HR development. Put some money where your mouth is and quit complaining. Give people a chance to improve by investing in their education and success. (Ok, those last two sentences were mine and not Deloitte’s.)
2. Deepen the business partner role, basically by developing highly trained business partners who are supported by specialists and service centers. (This will require an increase in HR staff and spending some money.)
3. Expand people’s skills, don’t just have them get better at the old stuff. HR professionals must become proficient in new technology and analytics, especially in predictive analytics in today’s business world.
4. Establish a development team just for HR.
5. Create self-assessment teams.
6. Mix in other business leaders, to have them acquire the necessary HR knowledge so it goes both ways.
7. Create centers of excellence and break down the isolation of specialties within HR.
8. Change the way HR is measured from general satisfaction to a metric-driven method.

With these changes, companies should be able to address the challenges of HR skill development in the 21st century.