SMEs need to adopt predictive analytics to manage their human resource effectively: CEO, SHRM

Achal Khanna also believes Indian organisations need to focus aggressively on building leadership talent pipelines through deploying leadership development programmes and communicating talent management strategies holistically

While we upskil the rest of the organization, we tend to forget that upskilling HR is equally important. Upskilling of the HR team and the department has to be in-line with the key factors that are going to affect your workforce so as to provide more relevant support to the organisation

Achal Khanna
CEO - SHRM India and Head Global Business Development

The human resource sector has evolved dramatically over the years globally, and India is no exception to this trend. Technology is being used in almost all human-resource-related functions right from recruitment to the learning journey to performance management. Advanced technologies, such as Internet of Things, which generate a huge amount of data associated with employees and how they perform their jobs, are also being leveraged by businesses to gain insights into human resource trends. In today’s time, it is imperative for businesses to be able to measure and interpret basic HR data and provide analytical insights into the business showcasing direct impact on business results.

Achal Khanna, CEO – SHRM India and Head Global Business Development, of the Society for Human Resource Management (SHRM), a global human resource professional society, spoke to SME Futures on the evolution of human resource functions, adoption of the next generation of technologies, challenges for small and medium business and the future outlook for Indian organisations.

Can you give me an overview of Indian organisations vis-à-vis their human resource functions? What has changed over the years?

Over the years, HR has matured quite a bit in India. From the time when it was just personnel management that helped in labour laws and few other things to today being a strategic partner in the business. HR functions have evolved drastically. Most organizations these days have properly demarcated functions within the HR team, which was not the case two decades ago. The need for specialized people in areas such as performance management, learning and development, recruitment, compensation and benefits has also increased owing to this. In the past decade, with the onset of social media, things are changing at a rather rapid pace. Technology is being used in almost all HR functions right from recruitment to the learning journey to performance management. Today, we have well-defined HR functions with people who know their exact role and work towards it in absolute sync with the business strategy.

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Do Indian organisations leverage data to formulate HR framework and resource optimisation? Is it only about large organisations or can SMEs also exploit HR data?

HR professionals across Indian organisations has started leveraging data, especially with respect to tracking basic metrics, like attrition, cost to hire and revenue per full-time equivalent [that is, per full-time employee]. And, this trend is universal across large and small organisations alike. The challenge today is more about the proactive use of data versus the reactive use of data. Most of the large organisations with established HR teams and analytics verticals have also moved to predictive analytics, especially in the fields of attrition and for succession planning. It is here that the SMEs have to catch up.

How do talent management strategies in India differ with the strategies in mature market?

Indian organisations across the board have strong talent acquisition, performance management and learning or training programmes (specifically in the technical skills domain). As next steps though, we need to focus aggressively on building leadership talent pipelines, deploying leadership development programmes and holistically communicating our talent management strategies. In terms of relationship with key talent though, Indian organizations realize that talent is a strategic asset and know their talent in a quantitative and qualitative format. There is that personal touch that most senior managers and leaders are able to deliver. A potential gap area, which again most are trying to bridge, is to bring in a systemic approach to leaders growth. For example integrating leadership development, succession planning and communication of talent strategies with the overall talent management process.

The HR sector seems to have found a connect with emerging technologies these days, such as Internet of Things (IoT)? Can you explain how IoT and other advanced tech help HR departments function?

Ten billion devices giving 24/7 access to anybody and everything. That is the Internet of Things for us, and there is a big way the HR sector can gain from and contribute to this scenario. IoT generates a huge amount of data associated with people and how they perform their jobs. This gives immense insights into HR, which is worth its weight in gold in helping organisations and more specifically the HR team come up with the people strategy for the organisation. HR professionals can potentially create more pleasant and efficient work environments by looking at productivity communication patterns, locations trends and how teams work together. However, a word of caution here – one must ascertain employee willingness to come on board for something like this. While people are connected 24/7 with their devices, be it fitness trackers or smartwatches, they may not be willing to give their employers unrestricted visibility into their movements and more. This is an area that HR must tread with caution!

How do the HR departments and professionals need to evolve in order to lead the businesses alongside other functions in the organisation?

While we’re busy up-skilling the rest of the organization, we tend to forget that up-skilling HR is equally, if not more, important. Up-skilling of the HR team and the department has to be in-line with the key factors that are going to affect your workforce so as to provide more relevant support to the organisation. However, one universal area of expertise that HR needs to develop is business acumen and analytics. It is imperative to be able to measure and interpret basic HR data and move beyond that to provide analytical insights to the business showcasing direct impact on business results. For this evolution to take place, HR must also be ready to be measured by talent metrics they deliver (like the quality of hire and retention) and related business results such as lowered expenses.

What are the top challenges for human resource in small, medium businesses given that SMEs are significant contributors to the economic growth of the country?

Human resource in an SME faces multiple challenges:

  • Lack of value for the HR team which leads to their initiatives not being given the level of importance they deserve
  • Talent Management – May it be recruitment or retention, L and D or Appraisals – it all lacks structure and alignment to the overall organization strategy and goals
  • Organizational Culture – The culture of an organization impacts the growth and overall decision making
  • Line Managers taking up the role of an HR – Owing to the fact that having a properly trained HR team is not an economically viable option for many SMEs, the basic HR activities are taken up my line managers. While this does take away a lot of crucial time from the line manager, time which would otherwise have been used to address the managerial responsibilities, it also impacts the quality of the HR decisions.

How does SHRM help organisations and human resource professionals? 

As the largest HR professional society, SHRM has been the leading provider of resources serving the needs of HR professionals and advancing the practice of human resource management. The SHRM chapter helps HR professionals with a rich knowledge repository, global HR certifications, and conferences. This helps professionals network with some of the best people in the industry, remain updated with latest practices and tools and have ample resources at their disposal. SHRM India helps many organizations with HR Advisory services that help them build a stronger HR base with more streamlined HR practices.

Can you share some insights for women who want to climb the ladder of entrepreneurs?

Women leaders continue to fight an uphill battle in a lot of companies and industries. However, at the same time gender equality is emerging as a strong focus area for most organisations, with the importance of a diverse workforce being appreciated by the C-suite. Personally, I believe women leaders need to take charge of their careers to be able to break the real or perceived glass ceilings. They must find ways to gain more exposure, in critical roles and teams, so as to hone their leadership and technical skills. They should speak up when they have an opinion (and back it up with data) and continue to network and build circles of support within and outside their organisations.

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