Escape HR tech traps to drive business value

HR technology is meant to do two things: free up the HR function from transactional work and enable strategic business impact. However, less than a quarter of HR functions are maximising the business value of their technology, writes Mark Whittle.

While HR leaders believe HR technology is important and impactful, they continue to struggle with gaining the most value. The goal isn’t to maximise technology’s value to HR alone but to maximise the business value technology can bring to the entire organisation.

Organisations need to change their approach to HR technology. This means shifting towards augmenting HR by increasing adoption and using the technology to create higher impact contributions. Gartner research shows this can increase HR technology business value by up to 54 per cent.

Transformational building blocks foster confidence

Poor experiences with HR technology cause low confidence in HR’s ability to drive technology transformation. Nearly half of HR respondents to a Gartner survey reported the use of HR technology solutions has damaged the function’s reputation across the organisation.

The business generally sees HR working on efficiency-driven technology and not always doing a great job, so it’s important to connect the dots for them. They need to see that foundational technology builds up to transformational technology.

This means presenting function and business leaders with proposed smaller changes rather than the big transformational goal. Start with the capability the business needs from HR, such as driving employee productivity. Also, illustrate the alignment between foundational elements and new technology value.

Once your stakeholders can see business value taking shape, then you can build up to transformative solutions, such as virtual assistants or GenAI pilots. But remember, getting sign-off for big changes is easier when they agree to the smaller ones first.

Expanded viewpoints inspire exploration

Like many employees today, in HR, they’re concerned about how evolving technology will impact their jobs and careers. Nearly half of HR employees surveyed by Gartner agree that HR technology has removed parts of their job they liked and nearly one-quarter of wider employees think AI could replace jobs in the next five years.

Let’s be honest: HR employees can sometimes get defensive about their work, especially when technology encroaches on the things that make them feel special or unique, but they need to see that AI will further their careers, not end them. Technology can be the partner they need to increase their own strategic business impact.

To help them adopt new viewpoints and perspectives around technology, HR leaders must go beyond training and tangibly illustrate how it supports new high-value work rather than limiting current jobs and activities. This entails crafting more transparent vendor relationships that expose HR staff to technology knowledge that links to the business problems they want to solve.

As an example, a global paper manufacturing company uses what it calls “wow” moments – digital experiences that get HR employees excited about new technology. The “wow” moment happens when technology combines with the HR employee’s expertise to make a major impact on their experience.

This is achieved in three ways. First, they map inputs to expand employee aspirations for what an HR activity could be and where they could have more impact. Then, they identify “wow” moments by finding the sweet spots where a key moment in the employee’s overall experience, the technology’s capability, and the HR process all overlap.

Finally, the “wow” moments are embedded into roles. Is the wow moment temporary or ongoing? Do they need to redesign the HR role to support it? Answering these questions helps HR and employees alike see the technology’s new business value.

This manufacturer found major success across the board with this approach, primarily leading to increased engagement with both its end users and the HR team around employee experience.

Goals and roles drive complementary solutions

HR technology solutions almost always focus on specific processes, but that just creates silos. This leads to lower adoption and, ultimately, lower business value. Sixty-nine per cent of employees experienced at least one barrier when interacting with HR technology in the past 12 months, according to a Gartner survey.

To highlight this, a major drinks manufacturer had the same problem until a light bulb went off. The company realised that every process should be judged against a single, shared outcome. A universal outcome that aligns with the business objectives drives HR technology adoption and applies across every HR process area.

The manufacturer’s goal is to create consistency for end users across all HR technology solutions. This universal outcome helps HR compare investments, prioritise them and identify the right skills needed for the best outcomes. It also makes measuring employee experience much easier – something that all HR leaders struggle with.

This approach puts business value front and centre and means process leads can better align on the right portfolio of solutions. It’s important to formalise shared goals and new roles that enable complementary, rather than siloed, solutions that create new value for end users.

To achieve this, the HR function must shift to creating shared outcomes that every process owner is held accountable for when designing or implementing a technology system. This enables consistency across HR technology initiatives. It also enables the ability to easily compare and prioritise investments, as well as identify necessary skills to reinforce the outcome.

Mark Whittle is a vice president of advisory in the Gartner HR practice.