It is a well-accepted reality that India is poised to be amongst the largest economies over the next two decades.

As our business world is charging at bullet train speed the major trends impacting industries are globalisation, technology, outsourcing and the talent crunch. The biggest challenge amongst these is the shortage of skilled manpower. For many companies, lack of talented workers constitutes a “make or break” HR issue. Naturally, there is an increasing obsession amongst CEOs with a higher workforce. Nowadays superior HR is not a luxury but a competitive necessity.

The HR profession as a result, is gaining both respect and attention—the kind that comes from being in the hot seat. As such, there are some trends one must be aware of:

Changing role

Talent shortage is the highest risk for Indian business. Recognising this, Chief executives have taken on the roles for strategic HR management. HR executives are themselves becoming C - level executives.

How HR managers will contribute and how seriously they will be taken depends on the big leap that the majority of HR managers today will take. Increasingly, more is being expected from HR practitioners and they need to broaden their skill-sets so that they can sit at the board table and understand as much about the businesses as the other leaders.

Accountability

If HR professionals want to be enabler of business strategies, they need to make significant contributions to the bottom line through expense reduction, or revenue generation, talent management and risk mitigation. CEOs are demanding that HR stop giving lip service to strategic performance and find metrics that prove that they are contributing to the growth and performance of the company through effective people management.

War for talent

The most important corporate resource over the next 20 years will be talent, smart, technologically literate, globally astute and operationally agile workforce. Today’s HR departments will have to become talent departments.

Traditional workforce planning is being replaced by talent strategies and skills gap analysis. The key to attracting and retaining scarce skills is for companies to be, and be seen to be, a first-tier employer that can meet the needs of high potential / performance employees.

Marketing practices will need to be applied to recruitment. Employer branding with a strong differentiator are imperative. Rather than positioning as “we are a big successful company,” positioning as delivering on the promise of continuous learning, work-life balance, fulfiling roles and innovative rewards and recognition is important.

Outsourcing

HR outsourcing is a growing trend. Today HR professionals are hardly hired for their ability to process employee information, sort resumes or process payroll on time. Instead, HR is expected to deliver value in areas like organisational effectiveness, talent management, change management, leadership development, succession planning, merger integration, strategic compensation, etc. The primary benefit of HR outsourcing is that it will allow the leaders to tackle these more strategic issues. HR needs to embrace outsourcing to reduce costs and get access to higher levels of service.

Healthy workplace

There is a definite link between work environment and the well being of its employees and between employee health and the bottom line. Long working hours, travel, competition, deadlines are the key causes of stress and burnout. Environment and lifestyle are creating a new health crisis amongst urban professionals, increasing the risk of infections, heart and back problems or mental stress. “Presenteeism” where employees come into work but cannot work at optimal levels is a growing concern. 

Companies must consider the full humanity of their people, looking at them not just as people with jobs and career, but as people with families, friends, beliefs, interests, passions, worries and futures.

Diversity

For the Indian private sector, diversity as a business strategy has preceded the employment equity criteria, which has only now begun to be adopted by a few companies on a voluntary basis. Diversity goes beyond nationalities, gender, colour, race or religion.

It is also about managing the demographic and psychographic characteristics of an evolving workforce. It will take a whole new level of education of tolerance. HR will need to provide cross-cultural support and training to virtual global teams.

Impact of technology

Eventually technology is going to eliminate most HR jobs as they exist nowadays. Technology with 24X7 communication capabilities, coupled with outsourcing, guarantees there will be smaller HR departments in companies.

Today CRM has given way to ERM - Employee Relationship Management. Employees can self manage activities previously handled by HR departments.  Technology will also help people connect within the work environment regardless of time and place as organisations are becoming physically local, yet virtually global.

Talent management

Talent management with a focus on soft skills, leadership development and succession planning is the defining trend in HR.

In India, technically qualified people are easier to find. But what companies require is a domain expert with managerial skills to leverage that expertise in the interest of the company. Selections are increasingly based on soft skills such as attitude, ethics, or people skills.

Today one’s educational qualification is just not enough to get a job. This becomes even more important as we go up the pyramid to middle, senior and top level managers. One of the scarcest capabilities is leadership.

As organisations, their customers, employees and their environment become more global and competitive, the competency requirements for successful leadership are increasing exponentially.  Leadership comes with empowerment and changing work-cultures across the levels through continuous learning, skill development and change management.

We now live in a world where the job and job requirements are constantly changing. Many of us are in jobs that didn’t exist three years back and three years from now many of us will be in jobs that don’t exist now. In this context, succession planning needs to be re-engineered, to focus on competencies rather than positions. Thus succession planning will evolve into something broader talent management, regardless of organisation structure.

In conclusion, HR professionals need to step up to these challenges or else other functional areas will take over this responsibility. Apart from domain re-skilling, the emerging HR professional has to be skilled cross-functionally.  It has never been better for the right thinking, right-skilled HR professional.

The writer is Executive Chairman, Walchand TalentFirst.