Future Friday: The future of HR according to John Boudreau

Professor at the University of Southern California’s Marshall School of Business and the Research Director at Center for Effective Organizations
Professor at the University of Southern California’s Marshall School of Business and the Research Director at Center for Effective Organizations

I had the good fortune to catch a webinar that was presented by the Harvard Business Review entitled Workforce Analytics of the Future: Using Predictive Analytics to forecast talent needs. It featured John Boudreau, who is a professor at the University of Southern California’s Marshall School of Business and the Research Director at Center for Effective Organizations. He is the author of several books including Beyond HR: The New Science of Human Capital, Retooling HR, and Transformative HR. In the webinar Boudreau made some thought provoking comments about HR and the importance of talent and how analytics is changing that world. Here are some of those comments and my reaction.

Boudreau’s view

Despite improvement in strategic initiatives HR is still only dabbling in it due to time constraints. Boudreau says that large companies like Google are using analytics and being strategic but most HR departments are not, especially in companies under 500 employees. HR departments are lean and have so much to do to keep up with the day-to-day. Companies are going to have to put resources toward their HR departments and they are loathe to do that.  
Turnover has long been the poster child for analytics in HR not because HR has the data but because accounting has the data. Obviously HR needs to be involved with the data. One data source he said HR should have is zip codes. Research has found that ability to hire and retain employees is tied very closely to the zip code in which they live.
HR needs to study and learn from supply chain models for talent acquisition. HR needs to talk to their customers in the customer’s language and make them understand that talent is also their issue. The point of his statement is that HR needs to get out of its “silo” and learn from other departments about how they approach solving their problem. He said “Approach them with a machine model. Would they overwork and run into the ground their machinery? Then why do they do it with people?” This requires HR to be more educated in the rest of business. I have always said that someone who has had a job in operations will make a better HR manager than someone coming with only HR experience.
HR needs to be a much better job of planning for the future. They need to plan for two or three futures. You have to hedge your bets. A portfolio approach is a good way to look at the future, having options available. This is why I write Future Friday. You need to be aware of what might be happening so you can have a plan. I give you some tips in my post Future Friday: 7 Steps to being a practical HR futurist. Check it out.
Because of the importance of talent we need to stop looking at everyone as the same. One of the things we should consider is individual employment contracts for every employee to reflect their value to the organization. That is an idea that many HR departments will consider radical, though in reality we do it like that all the time in small companies. But for companies with defined job grades and rules for how much can be offered, internal equity and the like that may be a tough departure.
There is going to be a very different form of contingent workforce. We have to get beyond the idea of employee and non-employee. Crowdsourcing projects will become a much bigger way of getting work done. The days of employees versus independent contractor may be coming to an end. He gave an example of one company getting a problem solved by putting it out on the Internet and having people solve it for them just for the challenge of getting it solved. We are seeing more and more situations where companies put a project out on a site try to get people to bid on the project. I belong to one such site where I have listed my credentials and companies can search for “experts” or the consultants can search for projects. Because of the global nature of talent you can often reach out to someone in another country and get the job done, often inexpensively. The one group that is going to have difficulty with this new definition of a contingency workforce is the government. The FLSA in particular is going to need an overhaul to allow for a new world.
Finding and developing talent is not an HR function. There has to be a company partnership. There has to be an understanding of what position makes the most impact for a company and talent needs to be concentrated there, but in other positions it is not always necessary to have the best. In these positions “good enough” will do. To me this has always been a problem with many managers. They interview and interview trying to find the “perfect’ candidate and pass up many who would been good enough. You have to make a distinction between your mission critical positions and the others and make sure you have the best talent in those mission critical spots. The problem is few companies have really done that analysis.

HR should be “mission critical”

The last comment I will make is that because of the importance of talent in today’s world companies need to realize that HR is a mission critical position, yet in most organizations HR is still seen negatively. Until those views are changed companies will continue to struggle with talent issues.
Photo credit: USC Marshall School of Business

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