On the road to recovery, cloud provides relief (Part 1)
The crisis . . . Everybody has been talking about it. Up to now, it remains a constant subject of discussion. In fact, we’re in the middle of it. Or are we really? The answer would depend on how you look at the world, I guess. It’s a fact that managers have become cautious and fearful because of the crisis and its implications for the organization. We’ve seen cost-cutting instead of revenue growth and short-term measures are taken even if these are detrimental to the organizational long-term strategy. And alas, the crisis reinforces the crisis. Nevertheless, the world keeps turning and fortunately many people are searching for opportunities to progress.
Only four years ago, I was a bit worried about how the crisis would affect HR. I wrote a blog about HR managers and the pork cycle. It talked about a model of fluctuations in agricultural markets that is based on production lags and adaptive expectations. In this model, when prices are high, more investments are made. The effect of investments, however, is delayed due to the breeding time. Afterwards the market becomes saturated, which leads to a decline in prices. As a result, production is reduced but the effects take a long time to be noticed, leading to increased demand and again increased prices.
The parallelism within HR is that HR managers have had to fire people because of the crisis, mostly in a hurry. Unfortunately, as we know, what’s done in haste is seldom done well. And it gets even worse when basic information gaps exist. How many people do you have, what are they good at and where are they? Without smart HR data, it’s really difficult to take the right decision. And there’s a significant risk that talent management will turn into talent destruction.
A consistent and sustainable human capital management strategy is fundamental for achieving goals. Every HR executive realizes that. But effectively aligning business strategy with your people strategy presents a significant challenge to many organizations. Not to mention the fact that budgets go down. Sad to say, such short-term decisions lead to the lack of talent in the longer term. The pork cycle has become a practice.
But as always, hard times can bring good things. These open people’s eyes to new ways of achieving their goals. These make people creative and accelerate development. Because in the end, no one will accept that things can’t be done only because there is a crisis. What crisis?
I think this is the reason cloud computing has become so popular in the last two years. It has been a blessing to everyone. Not the least to HR management, not as a remedy, but as a tool that opens doors that were previously closed. This explains why one of the 7 key trends that NGA predicted in 2013 is: “The cloud requires wisdom.” HR business leaders need to ensure they move with the times, getting the most out of new and innovative HR tools and technologies that are available.
To make this more concrete, one should look at the famous trio: people, process and technology. In that order. Because in the end, technology is only a means and not a goal. But for my explanation, I choose to end up with process, in particular, HR processes. Because the big advantage of cloud computing from an HR perspective lies in its ability to bring processes as a service. Old technology actually has impeded ability to sense change and respond quickly and appropriately. Cloud computing causes a deep and permanent shift in how computing power is generated and consumed. It’s as inevitable and irreversible as the shift from steam to electrical power in the beginning of the last century.
At present, there may be some scepticism around the cloud, particularly among IT professionals. But giving those people too much influence would be like putting the crew that runs the boiler and steam turbine in charge of electrifying a factory. The more relevant question is: can new technology help HR managers improve their work? Does it really open doors for the HR manager who sits sandwiched between two contradictory goals, professionalization and cost-cutting? The answer is yes. But it only works if organizations consider the whole picture and change step by step. And yes, there are some pitfalls and conditions. In the next few blogs, I will address them by treating the subjects: people, HR processes, and technology.
Are you already curious about what comes next? If the answer is yes, there’s a pretty good chance that you have already “crossed the chasm”. You are willing to change and adopt the developments that make it possible to change things. You want to move on and make your business grow despite the crisis. And because you’re an HR manager, your first worry is motivating your staff to change. And beat the crisis!