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THE FUTURE OF HR?
Dr. Peter Saul
Director, Strategic Consulting Group
Paper presented to:
Macquarie Graduate School of Management’s
“People Management and Leadership Conference”
September 16-19, 2001
Strategic Consulting Group
SHIFTS THAT ARE RE-SHAPING HR ROLES
FROM
Local markets, operations
Manufacturing, clerical work
Hierarchy
Intermediaries; face-to-face
Obedience to formal authority
Stability, efficiency, control
Full time job
Customer service
Work done by employees
Fixed work location
Management prerogative
Loyal service
White, male workforce
Financial performance
“Get a job”
TO
Global markets, operations
Service, knowledge work
Networks
Direct access,virtual relationship
Questioning of formal authority
Change, creativity, flexibility, order
Part-time and project work
Shareholder, stakeholder value
Work done by many contributors
Diverse work locations
Social licence
Marketable knowledge, skills
Diverse workforce
Triple bottom line
“Get a life”
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CHANGING WORKER ASPIRATIONS
 RICHARD BRANSON
 MICHAEL JORDAN
 RICHARD BORES (Wizard Home Loans)
 MERY STREEP AND JODIE FOSTER
 ANITA RODDICK
 NELSON MANDELA AND JERRY MAGUIRE
“…had a dream and went through with it...loved what he did…
lives life the way he wants... created this lifestyle for herself out
of what could have been a downward spiral…really inspiring”
AFR BOSS magazine, June 2001. Survey of work role models for white collar
Australians, in 20-30 years age range.
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HR AT A CROSSROADS
Results of a forum on the "The State of the HR Profession"
held in conjunction with the 2001 Annual Conference of the
Society for Human Resource Management
 “Significant change is inevitable for HR” but “what HR will be
and do is not yet clear”
 SRHM is doing research to develop a vision for the future of HR
and a profile of the future HR practitioner
 An HR practitioner might be "a hybrid line manager" who is
"first and foremost a business executive" but has expertise in
at least one HR function.
SHRM President and CEO, Helen Drinan
 “We have to get management to understand that they're
responsible for people” AND “If we do our job—and work
ourselves out of a job—so be it."
Also see FT.com online forum on “Human Resources: A career in crisis?”
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EMERGING LEGAL ISSUES AT WORK
 NEW TECHNOLOGY ISSUES
 AGE CONSCIOUSNESS IN THE WORKPLACE
 GLOBALISATION OF EMPLOYMENT LAW
 TRAINING FOR LEGAL COMPLIANCE
 WORKPLACE SAFETY
Source: Garry Mathiason (Littler, Mendelson, Fastiff, Tichy & Mathiason)
SHRM Annual Conference June 2001. Results of survey of 400 employment attorneys
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HR EXECUTIVES’ VIEW OF THE FUTURE
TOP 5 BUSINESS CHALLENGES
 Developing new markets
 Improving profitability
 Market share growth
 Becoming the recognised
global market leader
 Building shareholder value
TOP 3 HR CHALLENGES
 Attracting and retaining
talented people
 Improving organisational
capabilities
 Developing leadership skills
Source: Arthur Andersen survey of HR Executives in almost 70 Australian-based firms
Reported in HR Monthly, August 2001, p.17
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“The bad and the ugly in HR”
 “Many HR people still lack business acumen”
 “We have not adequately managed high expectations
of HR”
 “There’s too much modeling of mediocrity… and way too
little real research going on”
 “We have overhyped e-learning and some other fads”
 “We do much order-taking… and mistaking talk for
action”
Jim Moore, former Director of Workforce Development at Sun Microsystems
in his address to the 2001 SHRM Annual Conference
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Q. So, how do we organise all the shifts, trends,
speculation and forecasts into a framework
that can guide fruitful conversations between,
and strategic decision making by, senior line
managers and HR professionals?
A. Scenarios is one way
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FOUR AUSTRALIAN SCENARIOS
“FIRST GLOBAL NATION”
“SOUND THE RETREAT!”
Australia capitalises on
globalisation; promotes its
internal diversity and ethnic
tolerance; and boosts homegrown innovation and industry
capability
Globalisation stalls as political
and social structures are not
ready; trade barriers and
nationalism re-emerge; we
depend on bilateral national and
commercial relationships
“BRAVE OLD WORLD”
“GREEN IS GOLD”
Complacent, dependent on
agriculture, tourism, “new”
manufacturing and some
biotech; clever people and
companies move overseas
We emerge from the growing
imperative to protect the natural
environment as a leading
innovator of global environmental
management
Source: Australian Business Foundation “Alternative Futures: Scenarios for
Business in Australia to the Year 2015” Sept 1999
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DEFENCE: ‘In the Box’ Scenario Matrix
Open globalised
world economy
Global
middle
class
Source: Hardin Tibbs
report to Australian
Defence HQ 1999
Social
polarisation
and exclusion
Closed
protectionist
world economy
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DEFENCE: ‘Way Out of the Box’ Scenario Matrix
Revolution in
basic science
Single
world
government
Psycho-social
evolutionary
punctuation
Social progress with
no discontinuity
Source: Hardin Tibbs
report to Australian
Defence HQ 1999
Discontinuity in human
consciousness
Science
reaches a
plateau
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TWO SCENARIOS OF THE 21ST CENTURY ORGANISATION
MIT Initiative on Inventing the Organizations of the 21st
Century (January 1997) facilitated by Peter Schwartz of
the Global Business Network:http://ccs.mit.edu/21c/21CWP001.html
The scenarios were developed during 1994-1997 by MIT
academic and research staff in discussions with
hundreds of executives at various MIT Symposia,
executive education programs, etc.
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FUTURE OF ORGANISATIONS: Scenario 1
SMALL COMPANIES,LARGE NETWORKS




Autonomous teams of 1-10 people
Temporary - task or project based
Linked by high bandwidth, electronic network
Venture capital infrastructure identifies promising teams and
provides financing
 Independent organisations for social networking, recreation,
learning,reputation building and income smoothing
 evolved from professional associations, unions, clubs,
university alumnis, neighbourhoods, families, churches
 they are home for our identity as projects come and go
Examples: Film industry; Prato Mills (Italy); Nike; Nokia PC Display Division
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Small Company, Large Network HR
 Very specific HR scope focused on project organisation
(e.g. talent scouting/selection, pay, health & safety)
 Outsourced
 agents, brokers, specialist providers
 contract staff organisations handle the HR for their talent
as part of their brand and competitive strategy
 Mutual employment obligations spelled out in project
contracts
 or implicit in industry standards
 or assumed from past working experience
 Project Manager’s reputation depends on his/her people
skills and hence there is a reluctance to delegate to HR
specialists
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Small Company, Large Network HR (cont.)
 Selection is via networks, personal references,
reputation
 Performance management is via peer pressure and
industry/ professional standards
 Rewards are contractual or entrepreneurial (equity
based)
 Development is via doing leading edge projects
 Innovation is via brokers, deal makers, agents, sponsors
 Individuals rely on professional associations, “guilds”,
managers/agents
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FUTURE OF ORGANISATIONS: Scenario 2
VIRTUAL COUNTRIES






Keiretsu-like alliances with operating companies in every country
Minimal national allegiance - primary loyalty is to the corporation
Traditional hierarchy or decentralised divisional structure
Company is the focus for individual identity
Company meets employees’ needs from cradle to grave
Employees own the firm AND have right to elect the Board and
management
 Open book accounting informs management elections
 Specialist “organisational designers” travel through firm brokering
partnerships and fostering cross boundary communication
 Role of governments, industry unions is significantly reduced
Examples: Asea Brown Boveri; GE; Johnson & Johnson
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Virtual Country HR
 HR almost replaces social welfare, education systems
and provides financial management and estate planning
services, etc
 Corporate (strategic) HR
 sets standards and monitors the corporate culture
 helps Marketing build the corporate brand
 Divisional (operational) HR
 total care of employees so they are free to focus on
performance
 Actively involved in local communities to reinforce the
company culture and image
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Virtual Country HR (cont.)
 Selection emphasises fit with corporate values
 Performance management focuses on results achieved
the “XYZ way” and on being a company ambassador in
all areas of life
 Reward is via promotion, enhanced status, rights,
benefits - and pay
 Development is via corporate colleges and universities in
partnership with the world’s best educational institutions
 Innovation is through internal R&D and improvement
programs with heavy emphasis on protecting corporate
intellectual property
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CHANGING “HR” ROLES: Some Generalisations
PAST
HR ROLE WAS CLEARLY
DIFFERENTIATED
 mechanistic
(Personnel Admin)
 ritualistic, legalistic (IR)
 CEO’s eyes and ears
with the troops
 distinct professional
career paths
HR is HR’s responsibility
FUTURE
PEOPLE/LEADERSHIP ROLE IS
DISTRIBUTED AND DIFFUSE
 knowledge management
 relationship management;
teamwork
 legal compliance
 change management
 no distinct HR profession new hybrid roles emerge
People/Leadership is
everyone’s responsibility
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NEW CRITERIA FOR RATING “HR”?
 Profit generated per employee (compared to industry benchmark)
 Salary/wages costs compared to industry median (reflecting
value of corporate reputation/intangibles in labour market)
 Number of talented candidates applying for advertised (and
unadvertised) vacancies
 Time taken to satisfy customer orders, inquiries, complaints
(compared to agreed service standards)
 Incidence of customer complaints caused by employee behaviour
 Cost of re-work
 Cost/risk due to time lost through injuries, absences, disputes
 Rate/cost of unplanned turnover among good performers
 Percentage of customers citing “service quality” or “competent,
caring staff” as a competitive edge for the company
 Net cost of generating organisational improvements
 Percentage of revenue/profits coming from initiatives taken in
last 3 years
 Share price premium compared to industry peers
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AN INTEGRATING STORY?
OUTCOMES
ARCHITECTURE
FUNCTIONS
(Stakeholders)
(Leadership)
(Management)
Shareholder/
Investor
Customer
Contributor
- employee
- other
Community
VISION & MISSION
CORPORATE
STRATEGY
Competitive strategy
Development strategy
Leadership style
Culture/Values/Ethics
ORGANISATIONAL
DESIGN
Structure
Technology
Place
Finance
Investor Relations
Sales & Marketing
Operations
R&D
“Contributor Relations”
Contracts (Legal)
Supply
PR
Community Relations
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MAPPING YOUR ORGANISATION’S CURRENT TRAJECTORY
Get
Talent
Motivate
Reward/
Talent
Recognise
Talent
Develop/
Skill
Talent
Tap/
Utilise
Talent
Retain/
Transition
Talent
2000s
1990s
1980s
1970s
1960s
Derived from an HR framework proposed by Brian Young “PeopleFirst Solutions”
Previously Asia Pacific HR Director for Deutsche Bank
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MORE WINDOWS INTO POSSIBLE FUTURES
SOME WEB SITES ENGAGED IN THE SEARCH:
http://ccs.mit.edu/21c/index.html
http://www.foresight.gov.uk/default800.htm
http://www.defence.gov.au/nspb/htibbs-futuresV.4.ppt
http://www.dol.gov/dol/asp/public/futurework/welcome.html
http://www.fastcompany.com/
http://www.bsr.org/
and
http://www.csp.uts.edu.au/
http://www-csc.mty.itesm.mx/~laava/KMetaSite/menu/sitemap.htm
http://www.managewithoutthem.com/
http://www.futurists.net.au
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