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Agile HR: Trends and Opportunities

The future of human resources (HR) lies at the intersection of strategy, data analytics, design thinking, and a new set of practices and mindsets ushered in by the world of agile methods and organizational agility writ large. 

And the time is ripe for HR professionals to have the bandwidth necessary to devote themselves to such matters. Numerous HR services—particularly those that are more compliance and administrative in nature—have been prime candidates for outsourcing for years. Automation, furthermore, has the potential to eliminate or reduce further many repetitive HR tasks.

In the March-April 2018 issue of Harvard Business Review, Peter Cappelli and Anna Tavis outline a number of ways in which HR is adopting agile principles. In their article, “HR Goes Agile,” Cappelli and Tavis highlight how HR practices are beginning to trend away from the old approaches governed by rules and plans. Taking cues from agile, they contend, HR is increasingly moving toward a feedback-driven approach characterized by simplicity and speed.  

Here are some highlights from their article. 

First, a number of big trends are fundamentally influencing HR. These include increasingly rare lifelong employment and an environment marked by rapid change, which drives rapidly changing skill requirements. 

Second, the strategic imperative now is rapid innovation, and this applies to HR. In a fast-paced world, top-down planning doesn’t work very well. Instead, nimble, user-driven methods such as rapid prototyping, team-based decisions, and “sprints” centered on specific tasks. 

Third, such changes in the larger business environment are driving changes in specific practices, many of which are either HR-driven or used by HR. These include: 

  • Performance appraisals, in which the clear trend is toward having higher-frequency, sometimes project-based feedback versus the typical annual review. The emphasis here is on quick feedback to enable “course corrections.” Elements of agile methods and design thinking can also inform the organization’s approach toward performance appraisal design, with a specific emphasis on involving employees in the prototyping, testing, and iterative improvement process. 

  • Coaching, in which organizations are realizing that they must invest time in developing manager’s skills. In a world driven by high-quality feedback to drive fast improvement, managers need to build a robust set of communication and coaching skills. 

  • Teams, in which work may be best organized by projects instead of by functions or other aspects of formal hierarchy. Here, methodologies such as Scrum are proving useful, as well as norms and rituals that support multi-directional feedback, lower-level decision-making, and supervisors who facilitate healthy teams—not just individual performance. 

  • Compensation, in which incentives may be used to reinforce values such as learning and sharing knowledge. Another potential implication is the use of quick bonuses instead of annual merit-based raises. 

  • Recruiting, in which the use of cross-functional teams with hiring managers who rotate on and off depending on whether they’re hiring can drive the acquisition effort for specific sets of jobs. Prioritization is also key, because not all vacancies are created equal: Some should be filled before others. 

  • Learning and development, in which efforts become tailored to the job and the person in real-time. IBM appears to be at the forefront of these efforts, using “cognitive” (artificial intelligence) approaches to drive training. Additional value may be created by training the organization on specialized topics within the world of agile principles and methods. 

My take on this is that these are excellent points—and all in HR should heed them. 

But there’s much more, some of which I’ve written about previously. What remains somewhat unexplored is how HR can specifically help the organization overall become more nimble, more agile. Becoming agile itself may be a start, but HR should also continue to work to better define how its practices and strategies can drive innovation and responsiveness to change overall. Related topics and bodies of knowledge including strategy, data analytics, and design thinking play critical roles as well. 

What’s clear is that these are exciting times. And perhaps within this context, HR has an opportunity to—in the words of management scholar Gary Hamel— create organizations that are both “fit for the future” and “fit for human beings.”