Obviously, digitalization (cloud, artificial intelligence, machine learning, internet of things, robots, and so forth) disrupts nearly every business from retail to lodging to financial services to education to—fill in the blank. Digitization is also shaping HR through four phases.
This week I received two invitations to review the latest (and “greatest”) HR technology solutions. And this will likely happen next week and the week after and the week after. How can I make sense of this digital tsunami? Obviously, digitalization (cloud, artificial intelligence, machine learning, internet of things, robots, and so forth) disrupts nearly every business from retail to lodging to financial services to education to—fill in the blank.
Digitization is also shaping HR through four phases: Phase 1 is performing HR practices more efficiently (e.g., insourcing HR service centers through automation); phase 2 is the onslaught of HR innovations in all HR practice areas (people, performance, communication, work); phase 3 is accessing and using information to deliver business results; and phase 4 is forging connections among people.
The vast majority of HR digitalization efforts that shows up in my inbox are usually around serving phase 1 and phase 2 needs, as shown in the following articles:
In other essays, I will talk about the importance of phase 3 (information) and phase 4 (connection). But the immediate challenge of managing the tsunami of HR digitalization is to sort out which of these many new ideas I (we, in HR) should invest in.
When I ask HR professionals I teach how they sort through the many new digital innovations, about 70 percent of them responded that they simply discard all of them because they can not discern which should be used (e.g., they quickly delete all unsolicited emails). They know that at some level, this is being a troglodyte by avoiding the inevitable tidal wave of technological innovations. But on the other side of the coin, they could spend nearly their full time testing, experimenting, learning, and sorting to discover which of these new digital tools will and which won’t add value to them—which is unrealistic.
To encourage a start to this sorting, let me suggest five criteria for knowing which of these “latest and greatest” technology innovations deserve more attention.
1. Focus outside-in.
Ask: to what extent does this new digital technology connect its solution to external customers and investors? Many of the new technologies improve HR processes, but they are not linking these improvements to customers and investors who generally determine a firm’s future. We have written about the importance of an outside-in perspective, but many technology platforms are exclusively internally focused with no reference to customers or investor outcomes. So, in the promotion material, how clearly is the new technology linked to external (customer, investor, community) impact? This criterion alone often eliminates a large percent of the latest and greatest because they are not linked to business value.
2. Build on previous practice and research.
A computer science academic colleague said that well-intended students often approach him with the “latest and greatest app” that will dramatically improve the world. They are often disappointed when his advice is to “take a coding class” and “learn how to code.” Without basing new ideas on sound principles and practices, the new apps are on sandy soil, not firm foundations. Does the new innovation build on previous work? Does it complement and extend solid research or technology? Often the digital innovation has no roots in previous work and no research to supports the claims.
3. Offer an integrated solution.
Increasingly, HR practices in one area impact those in others (e.g., an organization’s hiring, development, rewards, and communication processes should reinforce similar messages). It is hard to have a career discussion without having implications for training and development, performance review, and engagement. HR technologies that offer innovation in only one HR area are unlikely to be as successful or sustainable as those that integrate across many HR practice areas.
4. Deliver on strategy and goals.
Sometimes the technological solutions are so exciting that they seem to be the “end” not the “means.” HR should always create practices that enable businesses to win in their markets through design and delivery of strategic goals. How will the technology solution help with the current strategic challenges? Will the information gathered help shape or deliver on the current strategic question? How will the technology enable strategic choices? When entering a busy freeway, cars don’t create their own new lane but merge into an existing lane of traffic. Likewise, new technologies generally should not create completely new strategic approaches but help move forward existing strategic agendas.
5. Fit with values and culture.
To get admitted to the Directors Guild in Hollywood, you have to have experience; but to get hired to get this experience, you have to be in the Guild. This same catch-22 exists with new technology. To get accepted, you have to have satisfied clients; but to get satisfied clients, you have to be accepted. Being the beta test site for a new technology increases risk but may also increase opportunity. To make it through the Directors Guild catch-22, a new director needs to build a relationship of trust with a producer. Assuming the beta risk comes when the technology creators share the culture and values of the company. Make sure that you are not just buying a technology app but forming a relationship with the creator of the app who will be a thought partner for future success.
Meeting these five criteria will not guarantee the viability of new technology. But by applying these criteria as technology filters, HR professionals can feel less overwhelmed and more able to access and use digital innovations that fit their organization needs. The “latest and greatest” technology innovation is usually the “most relevant and useful.”
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