CEOs commonly say that digital transformation is their top priority. Yet more than 60% of CHROs worry that they’re unprepared to manage coming technological disruptions, according to Gartner’s 2018 Future of HR Survey.
The core attributes of a good CHRO have stood the test of time. They include critical thinking, creativity, leadership, and communication skills. But CHROs need additional skills to build talent organizations that can move at the pace of today’s most disruptive companies.
Comfort with AI and advanced data analytics is part of the mix. “You don’t need a doctorate in AI to be a successful CHRO,” says Pat Wadors, chief talent officer at ServiceNow. “But HR leaders do need to embrace new technologies that enable their employees to get their work done more effectively and, ultimately, help them advance company strategy.”
CHROs need four key skills to thrive in today’s business world, according to Wadors and other experts. They should master “agile” methodologies that enhance team productivity. They need the ability to build teams that support corporate strategy. They should be comfortable wielding advanced data analytics to take the pulse of employee engagement. Finally, CHROs need 21st century hiring savvy to integrate “gig” workers into a diverse workforce.
Ninety‑one percent of companies still rely on annual reviews. Batched feedback like that is too slow at a time when entrenched business models are being disrupted by the likes of Amazon, Netflix, and Uber. In order to build organizations that can change course quickly, CHROs need to provide workers with feedback on a continuous basis, not just once a year.
Modern CHROs should be familiar with so‑called agile processes that are popular in software development. In the case of performance reviews, an agile approach would scrap annual reviews in favor of faster feedback, rapid rewards, and ongoing reassessment.
CHROs can use AI‑powered performance review tools like ADP Compass or Humu, which crunch data on workers’ productivity and give them “nudges” on how to improve it in real time. They can also hire data scientists to customize their company’s analytics to measure key objectives such as faster time to market for new products, or improved customer satisfaction in call‑center interactions.
Modern CHROs must be able to understand and communicate how business goals translate into hiring strategy. Seventy percent of CEOs expect their CHRO to be a key player in enterprise strategy, but only 55% feel their HR execs are living up to this expectation, according to Gartner.
CHROs need strategic vision to be indispensable players in the boardroom, says Peter Cappelli, a professor of management at the Wharton School. “Helping the CEO make judgments about top jobs is the path to influence,” he adds.
Modern CHROs chart strategy using a combination of business savvy and data science. Consider the hypothetical example of BankX, a financial services provider that seeks to integrate blockchain technology into its operations.
The BankX CHRO will need predictive modeling tools to answer core strategy questions like the following: How many blockchain experts do we need to transform our processes? How and where can we recruit the best candidates amid a talent shortage? Is it more cost effective to retrain in‑house talent or hire experienced (and pricey) pros? Should we partner with a blockchain startup—or acquire it outright?
Know the workforce
More than half of workers say their job responsibilities are too opaque, that they strain under too many demands, and that they’re entangled in too many professional relationships, according to a recent Gartner study. Most CHROs are unconcerned or unaware of these challenges. Only 18% of them rank rethinking and reconfiguring organizational structures as a priority within the next three years, the study found.
CHROs need sensitivity to the needs and desires of their workers. Traditionally, HR tracked worker engagement using feedback from employee surveys and performance reviews. Modern CHROs have a host of new tools at their disposal to measure employee engagement. Vibe’s algorithm analyzes emojis and word choice used by workers on Slack to gauge a team’s positive or negative mood. AI software Keen scans employees’ anonymized emails to discover and contextualize emotional trends.
“Everybody thinks of HR as touchy‑feely,” says Margaret‑Ann Cole, human resources expert and president of Crenshaw Associates. “But now there’s data to prove that when employees feel the organization appreciates them, their engagement and productivity levels go up. You can use that data to define and refine better programs to attract and retain talent.”
Sell the vision
CHROs need ninja‑level communication skills to transform entrenched HR processes. Want to launch an ambitious new talent strategy? You need to effectively communicate it to, and win buy‑ins from, key stakeholders across the company, from C‑suite executives to recruiters and even workers who may need to learn new skills as their roles evolve to meet business objectives.
“If I’m a good HR leader, I have a vision and skills so that I can communicate my vision clearly,” says Cole.
Smart CHROs listen to “upstream” feedback from employees and recognize when old HR processes are no longer working. That includes having a hiring and growth strategy that accounts for changing workforce dynamics. In the United States, more than 40% of workers are currently engaged in “alternative employment” such as contingent and gig work, according to a 2018 Deloitte study. This sector of the workforce has grown by 36% in the past five years alone.
Forward‑leaning CHROs don’t just fill positions. They think about building teams with the right mix of full‑time staff and project‑based freelancers. At the same time, they future‑proof their talent pool by reskilling and upskilling employees for evolving business objectives.
For CHROs to succeed on these shifting sands, they will need to lead the way from old HR processes into digitally advanced ones. “It will be important to know traditional HR,” Cappelli says, “but also be open‑minded enough to alternative ways to solve traditional HR challenges.”