North American HR Executive Advisory Practice Leader Franco Girimonte and Senior Research Director Anthony DiRomualdo discuss key findings from The Hackett Group’s latest Digital World Class HR research.
Welcome to The Hackett Group’s Business Excelleration Podcast, where week after week we hear from experts on how to avoid obstacles, manage detours and celebrate milestones on the journey to world-class performance. Today’s episode is hosted by Franco Girimonte, North American HR Executive Advisory practice leader at The Hackett Group. He is joined by Tony DiRomualdo, senior research director. The discussion today is centered around the 2022 Digital World Class.
To begin, Tony defines Digital World Class as Hackett’s representation of what they see as the top-performing HR organizations. It is based on a number of different measures, including their performance, enabling capabilities and other various practices driving performance. Not only are they outperforming typical HR organizations, but they are doing so in such a way to utilize digital technologies. Thirdly and especially important in the digital age is the experience of stakeholders dealing with HR organizations. Today, HR and businesses are having to cope with tremendous volatility, stress, and uncertainty across the board. What organizations need to be successful and sustainable in this kind of environment is having a high-performing and motivated workforce.
Then, Franco speaks to the key differences in terms of performance between Digital World Class organizations and baseline HR. In the technology area, Digital World Class organizations spend 90% more per employee per peer when it comes to investing in technology. They also show much higher levels of automation. This includes things like self-service, workflow, AI, synchronization and more. Compared to your typical HR, world-class organizations don’t give up on technology if it doesn’t land at first. In terms of productivity, world-class organizations service 67% more employees. This demonstrates that they have the right individuals working on the right activities to make the operating model and technologies more efficient, resulting in higher productivity. They also have a 34% advantage over peers in terms of operational cost.
Direct access is the ability for employees, managers, and even candidates to access data and functionality from HR systems. Digital World Class has moved away from this concept by extending HR responsibilities to the employee and manager. Now, it is more about enhancing the work, productivity, and experience of employees, candidates, and managers. Thus, Digital World Class organizations have an 83% greater deployment of self-service access capabilities. That means more cost-effective access to vital HR services.
In today’s market of the Great Resignation, retention is a major challenge for many organizations. This is where we see Digital World Class have some very distinct advantages. They do a better job of retaining employees because of their superior organization and use of technology. When it comes to retention, organizations need to be listening to their employees to figure out what’s going on and why they are looking for another role. The best way to combat this is having a listening capability. Other areas include the use of exit data, monitoring employee’s questions and using analytics to spot trends before they become a major issue. Using technology for recruiting and attracting new employees is also very helpful.
In terms of what HR leaders need to be doing if they want to make it into Digital World Class, the first step is technology enablement. First and foremost, take advantage of the tools you already have and make sure they are being utilized. Specific targets include enablement of processes and the enablement of our people in HR. Then, begin to landscape what the broad architecture of technologies needs to be in order to deliver a full-scale Digital World Class service delivery model. Having that big picture and understanding how it’s supporting your existing HR strategies, where you want to go and the key aspects HR impacts, then making sure you are prioritizing the new technology, is how to build this capability faster and more effectively. Finally, implement a stakeholder and customer-centric design.
As the episode draws to a close, Franco covers three more capabilities of Digital World Class organizations: use of data analytics, the evolution of the HR model and the talent within HR. He shares a real-world example of how an HR business partner was able to bring analytics to the conversation, resulting in total ownership of the conversation.
- 0:44 – Welcome to this episode hosted by Franco Girimonte.
- 1:28 – What is Digital World Class?
- 4:15 – Indicators of standout performance for Digital World Class organizations are compared to their peers.
- 8:05 – Direct access is explained.
- 11:01 – How digital top performers are maintaining retention.
- 14:40 – What do HR leaders need to be doing to make it into Digital World Class?
- 20:29 – Franco highlights three more capabilities of Digital World Class organizations.
- 25:11 – Thank you Tony for joining us today!