2016 - A disruptive year in review

At the end of 2015 I talked about the lack of new thinking and trends within the HR community. Since then 2016 saw a new trend emerge in the form of disruptive HR. The year itself has been disruptive throwing several big global events at us such as Brexit and the rise of the Donald. It is fair to say that not much went to plan last year, especially from a polling point of view. 

Impacts from the outside world on HR 

The Donald

Donald Trump’s rise to the White House surprised us all in 2016, nobody, perhaps least of all the man himself expected him to defeat Hillary Clinton. Whether you like it or not, he will be the 58th president of the United States. The draw dropping moment it was confirmed he had taken the White House, shook American and the rest of the world in the face of a divided electorate with Hillary winning the popularity vote. Interestingly, though during the elections we saw the stock markets reacting negatively when the now future president took the lead, it is at an all-time high now the deal is done.

WHY IS THIS ELECTION IMPORTANT FOR HR STRATEGIES?

I believe Donald Trump’s presidency has the potential to affect HR strategies globally like no other. His election is the result of the general population`s frustration with the globalised world. He will heavily invest in his own country and will likely question all current and future trade deals.

During the early days of his presidential campaign there had been speculation about what might happen if he were to win the election.  It is clear from his narrative that he is no fan of the Transpacific Trade Partnership – is there a real possibility we could see such deals heaped on the dustbin? It raises the question of the future of the TPP, could these negotiations end up back on the discussion table?

Certainly, for US native companies the question of whether to re-invest in labour in the US or abroad will become ever more important given Trump’s promise to name and shame business utilising labour outside the country. It will be interesting too to see his take on trade deals unfold and what the impact will be on global markets - which will suffer or grow in the wake of his leadership?

Donald`s more favourable opinion on Russia could mean the end of many trade restrictions and could jump start the Russian economy, an area many of you have disinvested. On the flip side, his very provocative stance on China could have a very negative impact on trading.

Brexit: 48.1% Remain vs 51.9% Leave

The Brexit vote shocked millions globally and plummeted the pound to its biggest drop in modern history, although this was relatively short-lived and the pound has since partially recovered. The long-term effects are unknown as we are still in a sort of limbo – awaiting to hear of a solid plan and for the official negotiations to begin.

From a UK point of view, Brexit is a significant challenge for HR, nobody really knows what the economic impact will be nor does anyone know what employment law will look like after Brexit - a significant part of the employment code is influenced by Europe. Changes on the latter will mobilise all the trade unions and significant industrial action is to be expected.

The major challenge we face is figuring out how do we prepare for the unknown? Simple questions like whether to hire key talent into UK operations or into entities in Europe, what to prepare for, where to invest and where not to invest, won’t be answered quickly. This will create more uncertainty and more uncertainty could breed chaos for the economy.

The UK government has been tight lipped about the actual plan on Brexit and many, and I include myself here, don’t believe there is a solid ready to go plan or even a semblance of one that starts to pave the path for departure.

If there is a plan then we need to be hearing about it now – too many unanswered questions; such as the fate of EU citizens who have made their home in Britain – are part of the labour force, and vice versa, could offset the potential for economic growth. On the flip-side, Brexit if done right could be a success for the UK – there are opportunities to be taken advantage of and despite your position on the matter we must also be aware of this.

From a political point of view Brexit might just create enough pressure for some good reform of Europe. From an economic point of view, Europe might benefit from companies moving operations to the continent. The risk for Europe from an economic point of view is somewhat limited providing no further nation is heading towards the exit sign.

New trends within HR

Disruptive HR was the industry buzz word of 2016. The only problem is that the community has no common opinion yet of what disruptive HR is. On the one hand, you will find many using the terminology describing how HR can shake up – disrupt – an organisation and hence potentially drive innovation across the business. You equally will find many who use disruptive HR to sum up the mega trends which they assume will disrupt HR itself.

What are 2016`s trends 

Technology and big data remain on the forefront of the HR agenda, there is still immense investment globally in HR systems covering the entire spectrum from recruitment, training & development, reporting and so on. Very often though I feel the investment is targeted in the direction of contact avoidance such as employee self-service, filter systems for applications etc. I believe this is the wrong direction, the only thing that counts is engagement and as much of it as possible – you can’t engage with a self-service portal.

Big data is naturally very different, it requires appropriate systems to generate the data in the first place. The grand idea is to combine internal and external data sources to find patterns and correlations which point to trends one could explore and exploit. The standard example one could mention are large high tech companies who try to use data to perfect the entire employee experience at work to maximise the amount of undivided attention they get from their staff per day. For example, they will be able to tell you how many more minutes of undivided attention they gain with implementing a nursery in the building. The challenge is that you don’t find many commercially viable big data projects, they often work in theory but are extremely costly to implement as they typically have to be developed and programmed from scratch. Most importantly though, the HR profession lacks talent with the right understanding of HR combined with the required analytical and technical skill.

I don’t think one needs data to predict that with millennials arriving in executive roles Diversity and Inclusion is set to be one of the next mega trends. This will become even clearer with the post millennial generations as they have a totally different view on D&I, but more on this in a different blog post.

Where does Disruption originate from

Well unfortunately, I assume it is a copy and paste idea from disruptive marketing, although I really hope I am wrong. The concept of disruptive marketing comes from the digital space developing marketing concepts which cut through the noise online and ensure relevant content reach the target audience. I hope the HR function has evolved above the point of having to cut through the corporate noise to be heard.

The real disruption

The real disruption this year has been the cumulation of geopolitical challenges, whether that is the further destabilising Middle East, Brexit, Trump or the Italian referendum they have all created market shocks and build up uncertainty. There is no time for new HR buzzwords. HR must rise to the challenges and use the ample opportunities to show its true value to the business.

I wish you all a great start to 2017. Please be in touch and share your thoughts and ideas.