ECI Head of People, Tamsin Webster, reflects on how managing human resources has changed over the past two decades and what people managers need to do to stay skilled, involved and at the cutting edge to capitalise on arguably a company’s most important asset.
Five ways HR leadership has changed
The role of HR leaders has undergone a seismic shift in recent years. Once primarily seen as an administrative function, HR has emerged as a strategic business partner, playing a pivotal role in driving organisational success. This evolution has been accelerated by a confluence of factors, including tech advances, changing workforce demographics, and the increasing complexity of the business environment.
As recent name changes might suggest (Human Capital, People, People Operations) HR leadership is no longer simply about compliance and administration; it’s about unlocking human potential and creating a high-performance culture.
1. From administration to strategy
Traditionally, HR leaders ran largely transactional departments, focused on tasks like payroll, recruitment, and benefits administration. While these functions remain important, the modern HR department has expanded its remit significantly. Today, HR is at the heart of shaping an organisation’s culture, attracting and retaining top talent, and being strategically and commercially focused to drive business growth.
A key aspect of this evolution is the adoption of a data-driven approach. HR professionals now have access to a wealth of data that can be used to inform decision-making. By analysing employee data, HR can identify trends, measure the impact of initiatives, and make evidence-based recommendations. For example, interrogating data on employee turnover to identify potential issues with retention, enables you to hone in on initiatives that really work, rather than trying a host of different programmes and approaches and hoping for impact.
2. The rise of the employee experience
The employee experience has become a critical differentiator for businesses – it’s no longer a one-way street determined by what organisations expect or demand from their employees. People’s expectations about what they expect from work and life have evolved. Employees who feel valued, engaged, and supported are more likely to be productive and loyal. HR leaders should play a crucial role in creating a positive employee experience. This involves everything from onboarding new employees to providing opportunities for professional development and creating a supportive work environment.
Additionally, HR must adapt to the evolving needs of the workforce. The gig economy, remote work, and flexible working arrangements have redefined the traditional employment relationship. HR leaders must be agile enough to respond to these changes while ensuring that the organisation has the talent it needs to succeed.
3. Talent acquisition and retention
Attracting and retaining top talent is a perennial challenge. In the global talent economy, great people have a choice of where and who to work for. Employers must differentiate themselves to become the employer of choice. HR leaders need to seize the opportunity and be at the forefront of initiatives developing effective recruitment strategies, employer branding initiatives, and talent development programs.
As a result, employee retention has become increasingly important. High turnover is costly and disruptive and HR now plays a vital role in reducing turnover by fostering a positive work environment, offering competitive compensation and benefits packages, and providing opportunities for career growth.
Building workforce capability is also critical to supporting this, with technology rapidly driving changes to training methods. Gone is the lengthy week-long (or longer) classroom-based learning, replaced with bite-sized blends of online, in-person, practical and reflective activities. Personalising learning and making it needs based, driven by the learner and ‘just in time’ is the new modus operandi.
Further to that, good business outcomes are achieved within environments where a wide range of perspectives, experiences and skills are brought to bear. HR leaders need to ensure that inclusion is a thread that weaves through the people strategy and decisions made across the business.
4. HR as a business partner
To be truly effective, HR must be aligned with the overall business strategy. HR professionals need to have a deep understanding of the business and be able to contribute to strategic decision-making. Often this means translating the strategy into what that means for every people process and by partnering with other departments, HR should help drive business growth and improve operational efficiency.
Moreover, HR leaders are more often required to adopt the role of coach to the executive team and guide them to understand and articulate the true purpose of the firm. Then moving from coach back to partner, helping leaders and holding them to account to deliver meaningful actions within their respective business areas.
5. The road ahead
The role of HR leaders will continue to evolve as the business landscape changes. Emerging technologies such as artificial intelligence and automation are transforming HR processes, freeing up time for HR professionals to focus on strategic initiatives.
The HR leader is no longer a support resource; they are a strategic business driver. By embracing the changes and challenges of the modern workplace, they play a vital role in helping organisations achieve their goals and build a sustainable competitive advantage.
