Complexity, the speed of change, and the rate of innovation in every business make it necessary to identify new premises for the People Strategy.
Technologies, new lifestyles and consumption behaviors, and the recent Covid-19 pandemic are reshaping multiple business sectors and, consequently, the business models of companies.
Today more than ever, competition is played out through the ability to effectively manage and respond to customer needs and problems right where they arise and manifest.
There is no longer time to climb the hierarchy and wait for answers from those responsible for making decisions. There is no longer time to forward requests and problems to specific corporate functions. Decisions must be made immediately at every level — in fact, they must often be made at the “lower” levels, where interaction with the customer takes place.
The March 2019 research by HR Exchange Network identifies agility, adaptability, and collaboration as three characteristics organizations will need to demonstrate to remain competitive over the next three years.
For this reason, achieving results and staying competitive requires people to work differently. Hence the importance of redefining the People Strategy, taking into account entirely new premises.
Dominant Dynamics
Traditionally, companies have tried to manage business context events by defining appropriate organizational models. Today, however, variability and unpredictability are such that any model quickly becomes outdated or ineffective.
In fact, many companies have shifted from investing in reorganizations to investing in the adoption of new ways of working, the evolution of organizational culture (or better yet, a new culture of work), and a new pact between people and companies.
An unmistakable sign of this trend is the spread of methodologies like Agile, Open Innovation, Design Thinking, etc. All of these encourage people to work differently, focusing on customer-centered solutions and delivering value quickly and continuously.
In this scenario — where organizations must first and foremost be fast and effective in addressing needs and problems from the very first customer interaction — we recognize what we call dominant dynamics in organizational transformation.
These dominant dynamics are:
- providing greater autonomy at all levels, including operational roles that are most exposed to customer contact.
- ensuring qualified know-how at all levels, in order to exercise autonomy effectively.
- assigning teams the responsibility for creating value, as complexity increasingly requires contributions from multiple areas of expertise.
The Traditional Response of the HR Department Focuses on Delivery Processes
The most common response is seen in the naming of the function. Many HR departments have been renamed in various ways — almost all including the word "People." A correct step but, in our opinion, a bit superficial. In the past, we’ve seen sensational renamings that ultimately amounted to little more than surface-level makeovers.
More advanced responses come from rethinking specific HR processes such as onboarding, engagement, development, etc. The goal of these actions is to deliver quick results — at the risk of falling into trendy buzzwords like digital, collaboration, smart...
The key point is that these responses, which focus "only" on changing HR processes, cannot bring about change aligned with the dominant dynamics we’ve defined.
They don’t allow for a real rethinking of how people work or of the pact between the individual and the company — in line with the evolving culture of work and consistent with the dominant dynamics.
This Is Why It All Starts with the People Strategy
The need to profoundly rethink how we work and the person–company relationship through a human-centred lens allows for the development of a systemic vision — one that goes beyond improving or innovating individual HR processes. The challenge remains the same: ensuring the organization has the right people.
Working on the definition of a new People Strategy makes it possible to create the right context and pathway to:
- identify the main drivers of the business strategy specific to your company/industry
- define the profiles of people capable of approaching the business with a fresh mindset
- set the right direction and approaches to effectively respond to the ongoing and increasingly rapid obsolescence of technical and professional knowledge and skills — many of which will be affected by the automation of intellectual tasks
The People Strategy is the key element for translating business strategy into HR practices and processes, but also for enabling the HR function to adopt innovative models such as Agile HR.
The Elements a People Strategy Must Take Into Account
Over time, the priorities and drivers guiding the new People Strategy will remain relatively stable because they are closely tied to the business strategy. At the same time, they will allow for proper alignment among HR professionals, enabling them to quickly update the processes and practices of the People function.
Based on our experience, there are four key elements that today’s People Strategy must consider in many organizations:
- the need to make decisions with a logic of progressive adaptation
- complexity of topics and situations, which require a multidisciplinary approach — placing teams at the center as value creation units
- greater contribution of advanced know-how, even in operational roles and activities (as is evident in production sectors transformed by IoT, for example), along with its rapid obsolescence
- virtualization of relationships and information
This highlights the magnitude of the paradigm shift affecting the foundations of HR disciplines, such as talent definition, development systems, learning processes, and reward mechanisms.
Even the old concept of belonging to the company is undergoing a deep transformation. As people gain more autonomy in defining how and when they work — thanks in part to technology — a new phase begins in which anyone in the company can define their professional identity starting from themselves. This was made especially clear during the Covid-19 lockdown, when many discovered the ability to redefine their private lives with greater freedom.