The pandemic transformed how many businesses operate, and HR has been at the heart of this transformation. Stacey Cadigan, partner at ISG, explores how HR technology has helped HR teams respond to the pandemic and looks at the impact these technological changes will have on the future of HR.
HR technology has taken center stage during the pandemic. The year 2020 saw the world of work change in unimaginable ways. This didn’t just rearrange the focus of HR activity; it required HR to lead in a way we’ve never seen before — a way that requires the best tools and technology.
Remote working, of course, has been the biggest challenge for many organizations, and getting the right tools and technology in place to support this has been a top priority. I know from our own ISG research into HR tech trends in 2021Opens a new window that remote working tools will continue to be a priority for companies in the future, as will developing and introducing the policies, processes and systems to support this new way of working. In managing a virtual workforce, organizations are concerned with how to effectively monitor performance and productivity remotely. There’s also still a strong focus on cost efficiency — how to support the workforce to be productive and at the same time free up resources to grow and scale as we emerge from this period of history.
Other pressing needs include technology to support the training and upskilling of employees and support employee wellness (an area that has really come to the forefront during the pandemic).
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How Technology Has Supported HR’s Pandemic Priorities
HR has been on the frontline throughout the pandemic, managing lay-offs and subsequent returns following furloughs, designing work-from-home policies and managing the safe return to workplaces. HR teams have done this while also focusing on the wellness and engagement of employees during one of the most stressful periods in recent history.
It hasn’t been easy. Not all organizations had the technology in place that was needed. Those that hadn’t previously developed plans to move to the cloud, for example, saw a new urgency to do so, as the way we all worked changed almost overnight.
Before the pandemic, organizations often contended with significant barriers to cloud adoption, such as securing funding for a business case or needing time to harmonize processes or change the operating model. It was seen as a big challenge for what are often small and stretched HR teams. The pandemic broke down many of these barriers.
Where businesses used to have their teams in central offices, they now had to find ways to engage employees effectively while they worked from home. They needed to find a way to support their virtual workforce and improve and monitor productivity. In short, HR functions needed to become more agile — fast. Those organizations who were already using HR SaaS or a hybrid SaaS solution as their primary HR technology model (around 46% in 2020, according to ISG’s research) fared better throughout the pandemic.
Another significant change is the focus on delivering real business value. Before 2020, we saw organizations investing in HR tech without really capturing or measuring value. Now, we’re seeing a significant jump in organizations identifying measurable business value after adopting SaaS (64% of businesses could identify business value in 2020, up by 23 percentage points from 2019). Productivity saw the most significant improvement in measurable value. But we’re also seeing upticks on measuring user satisfaction, engagement and quicker access to data, better data management and security, and reduced costs.
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SaaS and the Future Of HR
So, what comes next? We’ve seen what the right HR tech can do, and this won’t change once the pandemic is over. We’re likely to see more flexible, home-based and hybrid working (most organizations expect around half of their employees to remain remote at least until the end of 2021, and less than a third expect 80% of their employees to work onsite by 2022). HR leaders will continue to make smart investments in new technology so that employees thrive, no matter where they are based.
HR SaaS will continue to be critical to enable a more agile HR model — one that can respond quickly and efficiently to future challenges and changes to the way we work. If we’ve learned one thing during the pandemic, it’s the value of our employees and the systems to support their growth.