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HR TRANSFORMATION
Human Resources (HR) Business Partner 2.0

In 1997, Netscape was the browser of choice; Motorola StarTAC dominated cell phone popularity; the Apple PowerBook led in innovative laptops; cordless home phones emerged; Sony PlayStation with a 128k memory card was state of the art; Windows 95 was released. And I published the book Human Resource Champions, the ideas therein helped to define the HR business partner in terms of roles and outcomes within an organization.

In the ensuing 20 years, much has changed in the world of technology; and much has changed in the world of HR. The business partner concept has dramatically evolved (transformed, been disrupted, evolved, or whatever word you choose) from roles and outcomes to a logic of how HR delivers value to employees, organizations, customers, investors, and communities through individual talent (competence, workforce, people), leadership throughout an organization, and organization capabilities (culture, workplace, systems). In these 20 years, my colleagues and I have published over 25 books and hundreds of articles, chapters, research monographs, and blogs, and have given hundreds of talks on how HR is not about HR but about delivering value to multiple stakeholders.

Often critics of HR compare the 1997 HR business partner 1.0 model with the 2018 business requirements, assuming that HR logic and ideas have not evolved. This would be like saying the StarTAC phone should perform the functions of today’s smartphones. So it is useful to capture the concepts defining business partner 2.0. It is difficult, if not impossible, to summarize all the business partner 2.0 ideas, but the following table highlights thirteen pivots (because they build on the past, but they could be called disruptions or evolutions as well) each of which has been the focus of our (and many others’) thinking, research, writing, and practice.

We are incredibly grateful for HR professionals and thought leaders whose work we so readily assimilate, learn from, and build upon. The ongoing evolution of HR to a true value-creation stage comes from so many innovators. We appreciate their work and are grateful to be part of the HR value-creation movement.

HR’s evolution will continue as current business issues place HR center stage (e.g., digital information age, #MeToo movement) and HR needs to continually upgrade to respond; but it is useful to move at this time from business partner 1.0 to business partner 2.0. I should note that each of these thirteen dimensions is the topic of a book, article, webinar, or other public data that is readily accessible on our website (www.rbl.net) or on LinkedIn.

As these pivots continue, it’s a great time to be in HR!




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HR TRANSFORMATION
HR's war against the machines!

13 years after Fast Company magazine asked "Why we hate HR", the profession is still struggling to win hearts and minds.

HR leaders have been constantly exhorted to “get a seat at the table”; to have an opinion, and to be heard; to be “Strategic Positioners” and “Credible Activists”. I myself was part of this crowd when I represented Dave Ulrich’s RBL Group in Asia between 2011 and 2013, and ran numerous HR Business Partner excellence and development programmes.

So you can imagine that I was quite horrified when in 2015 data was published to show that 80% of business leaders did NOT regard HR as “useful” in enabling digital transformation.

Russell Reynolds, Digital Pulse, 2015

The reason I was so horrified, was that I was then driving the Digital Mindset strategy at DBS Bank, and regarded supporting the CEO’s vision on digital transformation as the most important part of my role. All the reports I was reading stated that supporting Digital Transformation and building a digital mindset was a CEO’s highest expectation of HR.

Yet here was Russell Reynolds saying that 80% of CEO’s rated HR as “unhelpful” in this regard. That was shocking to me as someone who had worked in HR so long and worked so hard to develop the state of the profession.                            

Roll forward a year, and in 2016 DBS was recognised as the “World’s Best Digital Bank” and the judges specifically referred to how a culture of digital mindset and capabilities had spread throughout the bank.

This was due to a close collaboration between HR and the innovation team. There was a substantial effort to build a strong digital mindset and develop future ready digital leaders, which included the award-winning DBS Hackathon series.

HR must be doing better right? So imagine my shock (again!) when just last week I saw the results of a recent global survey* of 25,000 business leaders by EY, DDI, and the Conference Board:

  • Here’s what caught my attention:The number one challenge for CEOs is developing ‘Next Gen’ leaders conformable in the digital world, but only 14% of CEO’s feel they have the talent they need to execute their future strategy.
  • Just over a third of leaders, (37%), feel comfortable in the digital workplace; less than a fifth (16%), of HR leaders feel equally confident.
  • The biggest gap in perception between business leaders and HR leaders is in “operating in a digital environment” – a 57 percentage point difference in opinion!
  • HR managers are perceived to “focus too much on “adminis-trivia” and lack vision and strategic insight.

So let me summarise:

The CEO wants future ready digital leaders, and can’t find enough talent - but HR is not comfortable operating in this “future ready digital” space and is perceived as being more comfortable focused on administration and traditional operations and services.

Are the Luddites killing HR?

The data would seem to suggest that HR people would rather focus on known and predictable tasks, processes and administration, than deal with the ambiguity of the future.

For anyone who has spent time learning about artificial intelligence, chatbots and automation, this would seem to be the kiss of death. Predictable, rote, administrative tasks are already being automated in finance, journalism and law; HR will surely be next.

For HR people to have a future, they must learn about the future, engage with digital and charge forth into this brave new world. They must be even more familiar with the digital world than the average business leader. They must play an enabling role in developing future-ready digital leaders, else the role of HR will be consigned to the dustbin of history. And the current data suggests nobody will miss us much! (The percentage of business leaders who regard HR as “proactive” (anticipators) has dropped 50% since 2014).

I was going to say “OK, rant over now”, but this was driven by data, not opinion – that’s what makes this so scary. So what do we do about it? How do we drag HR kicking and screaming into the future?

How about by “Developing future ready digital HR leaders?”


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HR TRANSFORMATION
Questions To Ask Before Letting An Algorithm Make HR Decisions

Nearing the halfway mark in 2018 and I am ready to call it right now - the topic/trend that has and will continue to dominate the HR and HR technology discussion this year is Artificial Intelligence or AI.

I will accept my share of the responsibility and blame for this no doubt. I have hit the topic numerous times on the blog, I have programmed at least seven sessions (or more) featuring AI topics for the upcoming HR Technology Conference, and the subject comes up on just about every HR Happy Hour Podcast at one point or another. In fact, one of my favorite HR Happy Hour Shows this year was the conversation I had with author and professor Joshua Gans on his new book titled Prediction Machines: The Simple Economics of Artificial Intelligence.

So if you are thinking that everyone in HR and HR tech is all in on AI you'd probably be right. And yet even with all the attention and hype, at some level I still wonder if we are talking about AI in HR enough. Or more specifically, are we talking about the important issues in AI, and are we asking the right questions before we deploy AI for HR decision making?

I thought about this again after reading an excellent piece on this very topic, titled 'Math Can't Solve Everything:Questions We Need to be Asking Before Deciding an Algorithm is the Answer' on the Electronic Frontier Foundation site. In this piece, (and you really should read it all), the authors lay out five questions that organizations should consider before turning to AI and algorithms for decision support purposes.

Let's take a quick look at the five questions that HR leaders should be aware of and think about, and by way of example, examine how these questions might be assessed in the context of one common 'AI in HR' use case - applying an algorithm to rank job candidates and decide which candidates to interview and consider.

1. Will this algorithm influence—or serve as the basis of—decisions with the potential to negatively impact people’s lives?

In the piece on EFF, the main example or warning cited when AI-driven processes might negatively impact people's lives is in the use of an algorithm called Compas, which has been used to predict convicted criminals likelihood to become repeat offenders. The potential danger is when the Compas score influences a judge to issue a longer prison sentence to someone the algorithm suggests is likely to repeat offend. But what if Compas is wrong? Then the convicted offender ends up spending more time than they should have in prison. So this is a huge issue in the criminal justice system.

In our HR example, the stakes are not quite so high, but they still matter. When algorithms or AI is used to rank job candidates and select candidates for interviews, those candidates who are not selected, or are rated poorly, are certainly negatively impacted by the loss of the opportunity to be considered for employment. That does not mean the AI is 'wrong' or bad necessarily, but just that HR leaders need to be open and honest that this kind of AI will certainly impact some people in a negative manner.

With that established, we can look at the remaining questions to consider when deploying AI in HR.

2. Can the available data actually lead to a good outcome?

Any algorithm relies on input data, and the 'right' input data, in order to produce accurate predictions and outcomes. In our AI in HR example, leaders deploying these technologies need to take time to assess the kinds of input data about candidates that are available and that the algorithm is considering, when determining things like rankings and recommendations. This is when we have to ask ourselves additional questions on correlation vs. causation and whether or not one data point is a genuine and valid proxy for another outcome.

In the candidate evaluation example, if the algorithm is assessing things like educational achievement or past industry experience of a candidate, are we sure that this data is indeed predictive of success for a candidate in a specific job? Again, I am not contending that we can't know which data elements are indeed predictive and valid, but that we should know them, (or at least have really strong evidence they are likely to be valid).

3. Is the algorithm fair?

At the most basic level, and the one that has the most applicability for our AI in HR example, HR leaders deploying AI have to assess whether or not the AI is fair - and the simplest way is to review if the algorithm is treating like groups similarly or disparately? Many organizations are turning to AI-powered candidate assessment and ranking processes to try to remove human bias from the hiring process and attempt to ensure fairness. HR leaders, along with their technology and provider partners have the challenge and responsibility to validate this is actually happening. 'Fairness' is a simple concept to grasp, but can be extremely hard to prove, but one that is inherently necessary in order for AI and algorithms to drive organizational and even societal outcomes. There is a lot more we can do to break this down, but for now, let's be sure we know we have, in HR, to ask this question early and often in the AI conversation.

4. How will the results (really) be used by humans?

If you deploy AI and algorithms for the purposes of ranking candidates, how will you use the AI-generated rankings? Will they be the sole determinant of which candidates get called for interviews, advance in the hiring process, and ultimately have a chance at an offer? Or will the AI rankings be just a part of the consideration and evaluation criteria for candidates, to be supplemented by 'human' review and judgement?

One of the ways the authors of the EFF piece suggest to ensure that human judgement is still a part of the process, is to engineer the algorithms in such a manner that they don't produce a single numerical value, like a candidate ranking score, but rather a narrative report and review of the candidate that a human HR person or recruiter would have to review. In that review, they would naturally apply some of their own human judgement. Bottom line, if your AI is meant to supplement humans and not replace them, you have to take active steps to ensure that is indeed the case in the organization.

5. Will people affected by these decisions have any influence over the system?

This final question is perhaps the trickiest one to answer for our AI in HR example. Job candidates who are not selected for interviews as a result of a poor or lower relative AI-driven ranking, will almost always have very little ability to influence the system or process. But rejected candidates often have valid questions as to why they were not considered for interviews and seek advice on how they could work to strengthen their skills and experiences in order to improve their chances for future opportunities. In this case, it would be important for HR leaders to have enough trust and visibility into the workings of the algorithm in order to precisely understand where any given candidate was ranked poorly. This ability to see the levers of the algorithm at work, and be able to share them in a clear and understandable manner is what HR leaders have to push their technology partners on, and be able to provide when needed.

As we continue to discuss and deploy AI in HR processes, we have to also continue to evaluate these systems and ask these and other important questions. HR decisions are big decisions. They impact people's lives in important and profound ways. They are not to be taken lightly. And if some level of these decisions are to be trusted to an algorithm, then HR leaders have to hold that algorithm (and themselves), accountable.


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HR TRANSFORMATION
Auditing the Effectiveness of your HR Department: Part One

For the last 30 years, the RBL Group has been on the forefront of HR transformation.  We believe that HR is not about HRbut HR begins and ends with business.  We find that many who focus on HR transformation are focused almost exclusively on how to organise the HR department.  We believe in designing the right HR department, but focusing ONLY on the HR department is a narrow focus of the overall effectiveness of HR.  

As we have done empirical research with over 100,000 respondents and advisory services with dozens and dozens of HR leaders, we have distilled nine dimensions of an effective HR department.

These nine criteria for an HR department may be seen as delivering value at four stages:

  1. Foundational/Administrative: HR focuses on efficiency
  2. Functional: HR focuses on best practices
  3. Strategic: HR focuses on delivering strategy
  4. Outside in: HR focuses on stakeholders outside the organisation

This results in a matrix that can be used to audit the overall effectiveness of an HR department. Here we look at the first four of the nine domains: reputation, definition of success, strategy and design.

Review the domains by the four stages of HR departments and assess where your HR department is today.  Use a scale from 1 to 10, with 1 being ‘low’ and 10 being ‘high', to assess your HR department in each domain and stage.

 

Effective HR department Stage one reputation

Effective HR department Stage two success

Effective HR department Stage three: strategy

Effective HR department Stage four: design

The challenge is that you can’t do everything well, so if you’ve already addressed the low hanging fruit, think about what you can decide to stop doing.  You may be doing work in HR that the business loves you for that isn’t in line with where the business is going. How do you manage that? It’s about being aggressive with priorities. 

Next week we will look at the remaining five criteria: organisation capability, analytics, practices, HR professionals and work style.

The nine criteria for an effective HR department build upon, and extend, the RBL Group’s empirical research and books in a number of areas, such as our 13 milestones of HR transformation (HR Transformation), the research results from round seven of the HR Competency Study (HRCS), research from Leadership Brand – RBL’s organisation capability audit tool, RBL’s four practices of an HR department, RBL’s work on HR value creation and HR from the Outside I’, and HR department questions from the book ‘Victory through Organization’.


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HR TRANSFORMATION
HR’s Pioneering Role in Agile at ING

In June 2016, when Maarten van Beek became the new HR director at ING Netherlands, he was struck by a powerful realization: his company looked more like a tech startup than the nation’s largest bank. Just one year earlier, the bank had officially gone live as an agile organization, complete with tribes and squads, standups and scrums, and a dramatically flatter structure. Since joining the bank, van Beek has witnessed its transformation into a leading-edge digital entity. The organization that began its agile journey by taking field trips to the likes of Spotify, Netflix, and Zappos is today giving its own twice-weekly guided tours for agile-aspiring organizations from all over the world. There’s even a waiting list. 

ING Netherlands’ agile transformation is no longer big news. The Dutch domestic-banking unit of ING has been celebrated as a paragon of agile ways of working among nontechnology companies. The transformation has accelerated the time to market for new services and fostered a wholly customer-centric mindset—two big reasons, its executives believe, why it garnered Global Finance’s Best Bank of the World award for 2018. What some may be unfamiliar with, though, is the role that ING’s HR team played in this transformation and the fact that it has undertaken its own agile odyssey. Both experiences offer important lessons for other companies making the shift—and for their HR organizations, as agents and adopters of agile transformation. 

ING established three new key roles: product owners, chapter leads, and agile coaches. Redefining jobs for some 3,000 people—roughly 25% of its Netherlands workforce—in two months was unprecedented. It also called for reducing the number of job types from approximately 85 to 15, including retiring the traditional full-time manager role. (Teams are now self-managing—“self-organizing” in ING parlance—and more autonomous.) This dramatic change in power structure and roles sent some managers to the exits—even those who had once been very successful. 

Equally unprecedented was the approach to employee selection. Most employees had to reapply for a position in the new organization. Because of the importance of digital and cross-functional collaboration, employees were interviewed by peer panels and chapter leads or product owners from different functional areas. The selection process—from rewriting job descriptions to appointing squad members—took four months. Within six months, ING Netherlands did a Big Bang rollout involving those 3,000 employees. In 2016, the call centers and sales force went agile, bringing 7,000 more people into the fold. (These groups adopted a modified version of agile; call center personnel, for example, are organized into 10- to 20-person customer loyalty teams and 50-person “circles” modeled after the structure used by Zappos.) 

As the bank continues tweaking its working model, more areas are making the shift. Agile is now being introduced in ING’s wholesale banking division and in other operational units in various countries. An enterprise-wide implementation is under way and set to go live in 2018.

HR GOES AGILE

As agile took root and spread during 2016, van Beek and his team members found themselves increasingly called on for support. People wanted to know: How do we conduct performance management? How do we develop our people? What should career paths look like now? 

Certainly those issues were high on the HR agenda. But the rapid change had left little time to tackle them. Now the team needed to turn its attention to its own transformation: redesigning processes and systems and reinventing their product portfolio so that they could accelerate the new people agenda and ways of working. Says van Beek, “We realized we needed to change our own ways of working in order to de-liver on our own purpose. We needed to move faster, be more proactive, and become top-notch HR professionals.” 

Like the broader organization’s transformation, HR’s shift to agile was fueled by the need to streamline product and service development, which would free up its leaders to focus on more strategic concerns. “The new ways of working were already transforming the business,” notes van Beek, “so we figured, why shouldn’t we—as the ‘people’ people—adopt them too?” Over several months, HR leaders gathered at workshops and offsites to hammer out a vision, objectives, and a working model. 

Revamping the Three Pillars 

ING’s HR organization, like that of many companies, is built on three pillars. Reorganizing these pillars using agile allowed HR to work more efficiently and create more consistent—yet still high-quality—products and services, with fewer staff and fewer handovers. The pillars today work in an integrated way to deliver HR’s purpose: building the craftsmanship and the engagement of everyone who works at ING, so they can deliver on the purpose and the strategy of the bank.

HR Business Partners. HRBPs advance the people strategy throughout the business. A dozen individual HRBPs have their own accounts—senior management, leaders of tribes and communities of expertise (CoE)—and are responsible for driving the people agenda of these groups. 

The rest of the HRBPs make up a flexible pool of partners who work primarily on execution-based teams (so-called to emphasize action) modeled loosely upon the delivery organization’s squads. Each of these “impact teams” is dedicated to one area: for instance, one is executing the bank’s new Step-Up Performance Management program; another is implementing ING’s new ways of working in other parts of the bank. This flexible pool enables HR to prioritize how it assigns resources, to ensure standardized products and services, and to develop and implement new tools and processes in far less time than it once took. The model allows ING to allocate resources where their impact will be greatest. 

People Services. This group, which provides day-to-day services to employees, is modeled along the lines of the call center teams, with circles dedicated to the four phases of the employee journey: join, develop, reward and recognize, and move on. Each circle consists of several employee journey teams, each responsible for a specific process. For example, changing jobs is a journey in the develop phase; earning a bonus or a sabbatical is a rewards journey. (See Exhibit 1.) People Services’ objective is to manage as many of the operational aspects of HR as possible, thus freeing HRBPs to focus on strategic priorities. Above all, the most crucial role of People Services is to create differentiated employee experiences that are customized by need and that make ING stand out from its competitors. 

Communities of Expertise. CoEs create thought leadership, develop the vision, share knowledge, and manage the work portfolio for their particular area of expertise, such as employer branding, workforce planning, or performance management. The expert teams that make up CoEs are divided into two clusters: talent and learning and performance and reward. Working closely with the impact teams, they develop HR processes and products together with their global colleagues (most are developed globally, some locally). The CoEs are also responsible for building HRBPs’ capabilities and helping them to work more effectively. 

New Ways of Working

In addition to adopting many agile practices—smaller teams, sprints, and an iterative approach to product development and execution—HR also created a special workspace for its planning and operations. Known as the Marketplace, or the Obeya (Japanese for “large room” or “war room”; a term borrowed from lean manufacturing), the room serves as a combination meeting place, control tower, and information base. Its walls are covered with posters and sticky notes that display objectives, priorities, epics (major projects), quarterly and annual plans, and dashboards—all designed to facilitate discussion and decision making. There is a communication wall, an action wall, a performance wall (newly added), and a portfolio wall for managing projects and activities (similar to Jira project management boards); leaders create tickets, which are then cascaded down to the appropriate teams. Information on the walls is kept up to date for viewing anytime. The Obeya has allowed HR to dispense with printed reports, minutes, and internal newsletters. 

HR leaders assemble in the Obeya every two weeks for standups to check in on the strategic themes and examine new data and customer feedback. (The larger team assembles quarterly to set bigger, longer-term priorities and accountability; all relevant personnel, not just HR leaders, are invited to their meetings.) Meetings and interactions are thus more frequent, more fluid, and less top-down. Van Beek considers his time in the Obeya to be the most productive time of his week. He says, “In an hour and a half, I know the status of every major deliverable and potential resource issues. When I need more in-depth information, I join one of the team standups or demos.” 

These new ways of working have allowed HR to standardize and streamline its output dramatically. Now, instead of creating different talent development, performance management, and benefit programs for each business and department, HR has one consistent approach. By using the MVP concept, HR can develop products and services more quickly and improve them iteratively over time. 

HOW HR IS HELPING ACCELERATE PERFORMANCE

Today, the HR team is concentrating on integrating the new ways of working into programs tied to the bank’s performance. Among its highest priorities is executing ING’s Step-Up Performance Management program, which promotes regular ongoing feedback and motivates people to aspire to be their best, through personal “stretch ambitions.”

Perhaps the most significant innovation is HR’s new Craftsmanship framework, essentially a statement of the bank’s compact with the employee in the new era. The term “craftsmanship,” reminiscent of the guild era, underscores the bank’s emphasis on skills and pride in professional development. “Stay curious, keep learning, and take ownership”: this motto greets all new employees on their first day of work. The Craftsmanship framework basically says that in return for the investment that ING makes in each employee’s development, the bank expects the employee to constantly hone his or her skills and expertise, become more agile and adaptable, and grow professionally and personally. In this way, the employee becomes more valuable to the bank and more marketable in general. 

The Craftsmanship framework makes each employee responsible for identifying his or her strengths that are worth developing (and, to a lesser extent, weaknesses that need improving). It also aims to explore the employee’s core motivations (or drivers, such as professional advancement or fun). The bank pledges to create appropriate challenges for employees, provide a trusting environment that encourages experimentation and makes it safe to fail, and explicitly recognize employees for their contributions. Pursuing these goals ensures that people perform better, understand regulatory compliance, and are equipped to provide customers with an exceptional experience. (See Exhibit 2.) Leaders believe that Craftsmanship gives people a sense of belonging and fuels their passion for their work. 

ING now uses Craftsmanship as a foundation for its frequent employee performance checks as well as for its personal-development plan, which each employee is expected to begin crafting on his or her 100th day. 

A NEVER-ENDING JOURNEY

Already, agile has had a tangible effect on talent at ING. Van Beek comments, “The focus on innovating for our clients makes working at ING inspiring. It also helps us attract top talent. We see this daily in our recruiting efforts.” In HR, agile adoption has had the same effect. He says, “We’re putting the right people together and encouraging them to take end-to-end responsibility for the task they face.”

In the spirit of continual learning and improvement that are the hallmarks of the agile organization, 90 HR team members recently convened for an agile retrospective: they reviewed what works and what needs work. Although HR is maturing, they agreed that more change is needed; for example, they will modify some of their hard-wired HR practices and focus more closely on building line-manager capability. Van Beek says, “We got a lot right when we implemented the new HR organization, but we also made mistakes. We need to change what we got wrong and try a new way.” 

So, what lessons does van Beek have to share with others at this stage? For one, companies considering adopting agile in HR should be sure to involve HR early in the organizational process. Such exposure gives them the perfect foundation and creates advocates. In addition, leaders should be generous in giving responsibility to those involved. “Make sure they feel enabled to make mistakes as they learn,” van Beek says. And “be transparent about the vision and the dream; allow room for how you will get there.” Agile is an ongoing journey, but it’s not a purpose in itself. Van Beek says, “The bigger challenge for HR leaders is ensuring that the HR function delivers on your organization’s purpose. Agile is helping us deliver on ours: empowering people to stay a step ahead in life and in business.” 


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HR TRANSFORMATION
How Design Thinking Is Disrupting HR

How can HR design employee experiences that empower critical thinking, teamwork, and innovation?

 

Design Thinking is an approach that will change HR in its core. It will develop a human-centric mindset that focuses beyond designing programs or processes to create meaningful experiences.

 

In one sentence: design thinking is a process for creative “problem solving”

 

Design Thinking brings an innovate approach that will change the way HR teams deliver value, organize work and find solutions. As Josh Bersin, from Bersin Associates, put it: “Design Thinking casts HR in a new role. It transforms HR from a “process developer” into an “experience architect.” It empowers HR to reimagine every aspect of work: the physical environment; how people meet and interact; how managers spend their time; and how companies select, train, engage, and evaluate people.”

 

Design Thinking brings a “Human-Centric Approach” that is present in every single step of the design process. Teams are empowered and accountable to gather user insights that start with the question: “How might we”. Understanding that “how” represents a solution-oriented approach, “might” encourages optimism and “we” represents collaboration.

 

Teams are encouraged to inspire new thinking by discovering what people need.

 

In some ways, Design Thinking leaves the traditional “waterfall” project management approach behind. In the waterfall approach, projects are divided into different stages. Each stage has to be completed before the project can move on to the next one. Projects are championed by a senior executive and hierarchy is king. Teams are not autonomous and need senior management approval to move forward in every single stage of the project. The results: when projects are finally ready to be launched, competition has designed something new first, customers need change, or the solution has become obsolete.

 

Furthermore, a Design Thinking framework is not correlative. This means that teams can check with clients or customers and come back to the project to make adjustments to potential prototypes and tests. The initial message here is: to create meaningful innovations, teams need to know their customers – or internal clients – very well. They need to care about the needs and expectations of their customers and/or clients.

 

Understanding Design Thinking

Let’s take a look at the opinion of Tim Brown – CEO and president of IDEO – in the article “Design Thinking” published by HBR: “A methodology that imbues the full spectrum of innovation activities with a human-centered design ethos. By this, I mean that innovation is powered by a thorough understanding, through direct observation, of what people want and need in their lives and what they like or dislike about the way particular products are made, packaged, marketed, sold, and supported.” This core concept is transformational for HR. It will involve leaving behind annual processes and approach-based planning for a simpler, more innovative and faster model driven by human-centered principles.

 

So, what’s the early message for HR?

 

HR needs to embed the “user or employee” at the center of the experience in its delivery model.

 

Design Thinking is a creative approach to problem-solving. As such, it leads to gathering inspiration, ideas, making ideas tangible and share the “story” to create innovative solutions. The design starts with:

 

  • Empathizing with customers first (understanding their needs and frustrations);
  • then moving to define the problem, and;
  • then brainstorming to identify and choose the best ideas and solutions, and then;
  • building prototypes to test what works and what doesn’t.

 

If it doesn’t, solutions are redefined by learning about users through testing in order to finally find a solution that meets customer needs. The graphic below describes the various stages:

 

Design Thinking framework

 

The human-centric design is focused on the user experience instead of the process “itself”. It’s about creating sparks of ideas to launch products and services that deeply resonate with customers or internal clients. However, the human-centric design involves a cultural “shift” and creating experiences that empower innovation, creativity, incentivize failure to learn and team-collaboration. Design Thinking has a strong success story in product design, technology, and marketing and is now being applied more broadly in various functions and businesses.

 

Including HR.

 

The message here is: It’s time for HR to adapt to an agile environment to create an employee experience using Design Thinking principles to deliver talent capabilities linked to strategy.

 

Design Thinking Framework

 

  1. Empathize: learn about your audience, what problems do the users face?
  2. Define: construct a point of view based on user needs, define the main problem you want to solve.
  3. Brainstorm: brainstorm and come up with creative solutions, choose the best ideas.
  4. Prototype: build a representation of your ideas and a prototype design.
  5. Test: test ideas and prototypes with actual users.

 

HR empowered by Design Thinking

Design thinking starts with “the problem statement” which is the core of the design. Participants need to be related to the problem that design teams want to fix. Directed storytelling allows designers to easily gather rich stories of real-life experiences from participants using thoughtful prompts and guiding and framing questions in conversations. Then the design team finds solutions based on the problem statement. Brainstorming is a part of this process and all ideas are accepted. Then the ideas are organized into categories (affinity diagram) and data from information-gathering activities is analyzed.

 

Innovation is a capability that HR needs to develop to adapt in a fast-paced environment where solutions need to be designed from the outside-in understanding the needs of customers and internal clients. For example, Cisco’s HR teams were trained to use Design Thinking. They looked at areas where HR could change drastically in tangible, practical ways, such as recruiting, onboarding, learning and development, and workplace design. Cisco was using Design Thinking to re-design the organization with a focus on “people experiences” instead of processes.

 

Design Thinking can be applied to every aspect of HR, for example, it can be applied to the candidate experience. The application journey can bring different expectations from the candidate perspective. Candidates are looking for an enjoyable application and interviewing process, an opportunity to learn about the company and to be informed about their current status and potential next steps.

 

If hired, the onboarding process, instead of providing general information about the company in 1 or 2 days, should focus on creating an experience where technology (artificial intelligence is bringing a whole set of tools for HR) leverages onboarding activities to make sure the candidate has access to agendas, responsibilities, and process-guidance.

 

In Design Thinking, we explore the actual needs of end-users through interviews, focus groups and informal interactions. This is called “empathize”. Throughout the design process, teams test what works and what doesn’t so that they can make sure they are building experiences that meet people’s needs. One key aspect that Design Thinking brings to organizations and HR is a “collaborative design approach”. Having people involved in the design process across different business units and functions brings a new perspective to problem-solving.

 

Dianne Gherson, IBM’S head of HR, interviewed by Harvard Business Review, led the employee experience overhaul using Design Thinking and mentioned “We have found that employee engagement explains two-thirds of our client scores. And if we are able to increase client satisfaction by 5 points, we see an extra 20% in revenue, on average”.

 

What was the message here? There was a direct impact between employee experience and customer experience but where – and how – to start?

 

IBM brought people from different functions into the design process and teams were accountable to co-create a brand-new employee onboarding process. Everything started with an initial assessment to understand the new hire’s point of view and realize that the onboarding experience involved working with a broader set of players to make it happen.

 

Performance management is another process that has been disrupted. The traditional performance management with 2 or 3 stages has not been creating a direct impact on the business. Organizations were measuring individual results when in reality, objectives were accomplished by teams.

 

IBM approached this case as well, deciding to work with employee groups instead of bringing in a bunch of field experts. They used Design Thinking and after 5 months of hard work, the brand-new performance model was implemented across the company. According to Dianne, “The power of engaging the whole workforce lies in the fact that they are much less likely to resist change when they have had a hand in shaping it”.

 

To sum up, HR can leverage this Design Thinking approach creating cross-functional task-force teams to design experiences related to onboarding, learning, candidate experience, performance management, recruiting and in general to every single HR practice.

 

Final Thoughts – Questions for HR designers:

 

  • How can HR re-set its mindset to use Design Thinking?
  • Would Design Thinking work in all HR functions?
  • How do we know if our prototype is worth iterating on?
  • How do we know which customers we should talk to first?
  • How can HR use the human-centric design to design employee experiences?
  • What does a great employee experience look like from the moment someone is hired until the moment they leave the company?