Views on the News: Systemic HR and Why It’s Important for 2024

 

Welcome to our latest segment of Views-on-the-News! Today, we’re exploring insights and trends from Josh Bersin’s latest guide: “The Definitive Guide to Human Resources Systemic HR“.

With so many insights and data points at our fingertips, we’re excited to share key findings from Bersin’s recent report – and offer our own perspective on the major trends shaping employee expectations and organizational changes for the year(s) ahead.

Now let’s get started.

2024: Embracing the Post-Industrial Age in HR Organizations

To understand the future, let’s first reflect on the recent past. Needless to say, the past few years have been a rollercoaster for employers, navigating fluctuating employment rates and economic uncertainties.

We all saw the shockwaves of widespread uncertainty which began in 2020 and led to a staggering unemployment rate of 15%. But…. fast forward to the present, unemployment rates have settled just under 4% (at least at the time of publishing), marking a remarkable turnaround. (Phew!)

Companies have started regaining their footing and economic conditions have improved, ushering us into a new era in the HR landscape – the “Post-Industrial Age,” according to industry leaders.

This era embodies a delicate balancing act for businesses, characterized by rapid workforce expansions to meet surging demands, followed by necessary downsizing during inevitable slowdowns. It’s a dizzying cycle that underscores both the dynamic nature and unpredictability of today’s business environment.

While this business tightrope act may seem daunting, it presents a unique opportunity for organizations to carve out a clear path forward. This is where Josh Bersin’s new guide comes in: “The Definitive Guide to Human Resources: Systemic HR” serves as a beacon for HR teams navigating this new era.

Drawing from the largest HR dataset ever analyzed, including insights from over 1,000 companies, interviews with CHROs, and LinkedIn’s extensive database, the report offers actionable guidance to HR professionals as they navigate the evolving landscape of HR management.

In the following sections, we’ll recap key trends and takeaways including: What is systemic HR; what it means for businesses; and how you can achieve it.

The Importance of a Strategic and Systemic HR Function

In his guide, Josh Bersin urges businesses to transition from traditional HR models to a more agile, and potentially strategic approach.

He advocates that businesses move on from legacy HR paradigms, focused on efficiency and cost control, in favor of what he terms as “Systemic HR” – a comprehensive framework characterized by a business-aligned strategy, integrated operating model, agile organizational structures, and employee-centric technologies.

Essentially, Systemic HR equips organizations with the tools and strategies needed to thrive in today’s ever-evolving business landscape. Don’t believe us? The proof is in the pudding.

Let’s delve into the data from Bersin’s guide that illustrates how teams with systemic HR practices are getting ahead of their competition.

1. Business Outcomes

Organizations are twice as likely to exceed financial targets and delight customers when their HR functions strategically and systemically.

When you align talent management strategies with overarching business goals, you can ensure that every hire, promotion, and development initiative directly supports the company’s bottom line.

2. People Outcomes

Organizations with systemic HR are seven times more likely to attract the needed talent. Plus, they enjoy 12 times higher workforce productivity, indicating a workforce that is not only highly skilled but also committed to delivering exceptional results. Furthermore, systemic HR organizations boast a retention rate nine times higher than average.

In today’s competitive talent landscape, attracting and retaining top talent is imperative for organizational success – making those numbers pretty compelling.

Systemic HR practices significantly enhance an organization’s ability to achieve these goals by prioritizing employee development, engagement, and well-being.

3. Innovation Outcomes

Organizations with systemic HR are seven times more likely to adapt well to change. Moreover, they are six times more likely to innovate effectively.

This showcases how systemic HR plays a pivotal role in fostering a culture of innovation. It does so by leveraging the diverse talents and perspectives of a team to drive continuous improvement and innovations.

As you can see, Systemic HR practices can serve as catalysts for organizational excellence, driving business success, empowering people, and fueling innovation.

The Four Pillars of Systemic HR

Now that we’ve defined systemic HR and its benefits, it’s time to explain how to get there. According to Bersin, systemic HR consists of four key pillars, each with its own timeline for implementation and scale of impact.

Below, we quickly outline each pillar and its contributions to organizational success.

1. Reskilling involves developing career pathways, skills taxonomies, and talent mobility programs. Despite a slow implementation, it has an immediate impact and empowers your workforce to adapt to evolving needs.
2. Redesigning includes evaluating and rethinking your employment model and technology infrastructure. While implementing it takes time, it has an impressive payoff. Those who redesign are able to streamline processes, eliminate inefficiencies, and position themselves for sustainable growth.
3. Recruiting means optimizing your recruiters’ skills, enhancing the candidate experience, and strengthening your employer brand. This is a quick win: it has a fast implementation and quickly helps attract top talent.
4. Retaining focuses on improving the employee experience through leadership practices, benefits, and analytics. With a quick implementation and long-term impact, it’s a compelling area to focus on. In turn, it fosters employee engagement, loyalty, and satisfaction.

All of this to say, these four areas of systemic HR represent a big shift away from traditional HRSD models.

By focusing on the four pillars of reskilling, redesigning, recruiting, and retaining, you’re better suited to unlock the full potential of your team, drive innovation, and achieve sustainable growth in today’s competitive landscape.

Skillcentrix’s Addendum: How to Move Towards Systemic HR Status in 2024

For most organizations, the path to becoming a systemic HR organization is a journey marked by continuous improvement and evolution.

While systemic HR represents the pinnacle of HR excellence, it’s crucial to acknowledge that many organizations are still quite far from achieving this status. If you’re reading this blog and thinking, ‘this whole systemic HR thing sounds nice and all but where the heck do I start?’ This next section is for you.

Step #1 to Systemic HR: Start with Skills

If you’re feeling a bit overwhelmed by the prospect of achieving systemic HR status, that’s ok. Take a deep breath. As they say, the journey of a thousand miles starts with a single step.

In this case, your first step is a skills strategy. A skills strategy should be the cornerstone of your HR strategy, providing a roadmap for talent development, workforce planning, and organizational growth.

A well-defined skills strategy enables HR teams to identify and prioritize the skills needed to drive business objectives, aligning talent development efforts with organizational goals.

While implementing a skills strategy requires a significant investment in time and resources, its impact is immediate and far-reaching.

By investing in reskilling and upskilling initiatives, you can equip your workforce with the capabilities needed to thrive in today’s rapidly changing environment.

A robust skills strategy can set the stage for your firm’s long-term success and longevity. By continuously assessing and updating skill requirements, you can future-proof your workforce, ensuring they remain agile and adaptable in the face of evolving market demands.

Even more, a skilled workforce enhances employee engagement, satisfaction, and retention. It fosters a warm culture of development that both attracts top talent and drives organizational excellence.

In essence, a skills strategy is not just a roadmap for talent development; it is a powerful tool for organizational transformation. By prioritizing skills development as the first step towards systemic HR, you can lay the groundwork for sustainable growth, resilience, and success in the digital age.