Emerging Trends in Human Resources

Introduction

Human resource management, HRM, is the department of a business organization that looks
after the hiring, management and firing of staff. HRM focuses on the function of people within
the business, ensuring best work practices are in place at all times. Secondly, it encompasses
the management of people in organizations from a macro perspective i.e. managing people in
the form of a collective relationship between management and employees. In the words of
Dunn and Stephens, “The HRM is the process of attracting, holding and motivating all manager
line and staff”. In a nutshell, the primary task of HRM is to ensure that the organization HR are
utilized and managed effectively.

In the contemporary business environment, organisations are in a constant state of competition.

As the intensity of competition increases annually, the need for the organisations to
continuously improve their performance has never been greater. Though traditional sources of
competitive success, like natural resources, technology and economies of scale, add value to
an organisation, their significance is decreasing as these sources are easy to imitate. Therefore,
the significance of human resources (HR) as the greatest asset of a business enterprise has
increased since Human Resources constitute an organisation's intangible, irreplaceable and, un-
imitable resources (Pfeffer, 1994). The environmental changes that are external to the company
prompt inner organisational changes. Competition, globalisation, changes in the market, social,
economic, and technological spheres pose a major challenge to the contemporary management
of human resources and are the principal reasons for the transformation of HRM. Since change
is occurring so rapidly, there is a need for new ways to manage. The pressures for change are
likely to continue and even intensify. As the economy becomes more fully globalised, every
organisation is likely to feel the impact of foreign competition. Thus, the future challenges
before both the HRM academics and practitioners is to find out the various factors which affect
HRM so that appropriate HR practices can be formulated and successfully implemented.

However, these goals and challenges require different skills and HR tools to succeed. In order
to keep up with modern HR practices, we need to know about the latest trends. And more
importantly, how those can improve the organization. The following report highlights the
limitations of the traditional practices and points out the key emerging HR competencies that
drive results today which are integrated with talent management, understanding of workforce
planning, and comfort with social networking and HR technology.
Factors Affecting HRM

Globalisation and its implications

Business today doesn’t have national boundaries – it reaches around the world. The rise of
multinational corporations places new requirements on human resource managers. HRM must
also develop mechanisms that will help multicultural individuals work together. As
background, language, custom or age differences become more prevalent, there are indications
that employee conflict will increase. This will necessitate managers being trained to recognize
differences in workers and to appreciate and even celebrate these differences.

Work-force diversity

In the past HRM was considerably simpler because our work force was strikingly
homogeneous. Diversity is critically linked to the organization’s strategic direction. Where
diversity flourishes, the potential benefits from better creativity and decision making and
greater innovation can be accrued to help increase organization’s competitiveness.

Technology

With the current technological advancement and its projection in the future, it has brought in
new eyes in the face of HRM. A number of computerized systems have been invented to help
in the HRM of which they are seen as simplifier of HR functions in companies. Large or
multinational organizations using some of the human resources information systems are
reaping big.

Health

With the emergence of the wellness clubs and fitness centres together with the need for having
healthy workforce, it has emerged that HRM has to move to another step like having to
subscribe for its employees to such clubs, paying health insurance services for the staff. This
is not only a productivity strategy but also a strategy used to attract and retain valuable
employees.
Literature Review

Author Tanuja Agarwala in her paper ‘Human Resource Management : The Emerging Trends’
(Agarwala, 2002) showcases major factors that have brought about the need for innovations in
human resource (HR) practices. In this paper issues related to the innovative practises to HR
are been explored. Further, to understand the emerging trends and the nature of innovations in
human resource practices, the study generated examples of innovative practices for each HR
practice category. To meet the objectives they conducted an in-depth interview of experts
across the industry to ascertain the general trends in the practice of HRM in the organisations,
the changes and innovations therein that have taken place in the last few years. Since there is
an increased pressure to measure HR effectiveness, the study also focusses on identifying key
employee and organisational outcomes that were likely influenced by innovative HR practices.
Thus from the interview and research they observed that enhanced competition had led to
increased competition for quality manpower. And most of the innovations in human resource
practices were oriented towards reducing employee turnover. Thus, employee retention and
employee development were identified as important intended outcomes of changes in Human
Resource practices. Another outcome that the organisations wished to achieve through HR
innovations, in view of experts, was to foster an enabling climate characterised by trust,
collaboration, developmental orientation, proactivity, etc. For which companies are now
focussing on the new trends like detailed onboarding processes, offer training and attractive
career plans, activities and teambuilding, workforce diversity.
The Delloitte Human Capital Trends 2019 Report focuses on importance of the “alternate
workforce”, making employee experience human experience and developments in other
aspects of HR namely accessing talent, HR cloud and talent mobility. It al
Organisation Profie

Persistent Systems is a technology services company which was incorporated on 16 May 1990
as Persistent Systems Private Limited by Dr. Anand Deshpande – who holds a PhD. In
Computer Science from Indiana University USA. Persistent has 300 customers spread across
North America, Europe, and Asia. Today, Persistent focuses on developing best-in-class
solutions in four key next-generation technology areas: Cloud Computing, Mobility, Analytics
and Collaboration, for telecommunications, life sciences, consumer packaged goods, banking
& financial services and healthcare verticals.

Persistent describes itself as – ‘A company that builds software which drives the business of
our customers; enterprises and software product companies with software at the core of their
digital transformation.

Persistent has a global workforce of over 10000 people with offices in Pune, Bengaluru,
Nagpur, Hyderabad, San Jose, Sri Lanka, UK, to name a few.

The HR team of Persistent has about 130 people and consists of various departments like
Learning and development, Recruitment and Selection, Compensation and Benefits, Business
Unit HR.

At Persistent, we interviewed Senior Vice President - HR. He previously led the compensation
and benefits team following which he also led the HR Technology and Analytics team, making
him a perfect fit for the “Emerging Trends in HR” interview as he has been in the midst of the
changes from the very beginning.

He holds a B.Tech in Computer Science from College of Engineering Pune and an MBA in
HR from Bharati Vidyapeeth's Institute of Management and Entrepreneurship
Development, Pune.

When asked about the importance of HR he said that for a company in the IT sector, human
capital is everything. As intensity of the competition keeps increasing, traditional sources of
success like technology, economies of scale are easy to imitate, so the major differentiator is
Human Resources and it continues to be one of the most important assets at Persistent.

When asked about how the environment in HR has changed over the years and how HR at
Persistent has changed as the company has grown, he said that there have been major overhauls
at how we look at HR or how we deal with certain aspects of HR, but their primary goal has
always been to stay true to their values and fundamentals – and that’s how every function in
the organization has evolved.

Persistent being an IT company, has always relied heavily on outsourcing. Therefore,

contingent workforce management has become an integral part of the emerging HR trends.
However now contingent workforce management is used not only for employing skilled IT
professionals but also for various other areas like brand strategy, M&A and more. Instead of
outsourcing their contingent workforce management, Persistent does it inhouse and has a well
established VMS (Vendor Management System) that keeps tabs on all aspects right from the
database to the payments of the required contractual workforce. It also forecasts seasonal
requirements based on past data and also shows contractors past performance and future
availability.

Artificial Intelligence and Machine Learning has started to play a big role in the HR systems
at Persistent. For recruitment, Persistent uses a platform called “Career Socially” which has
billions of data points on various aspects of a job and they are put together to match your
requirements. Based on your past hiring pattern, using machine learning, new options tailored
to suit your hiring needs are shown to you. Video interviews are also conducted where the
candidate answers a set of questions and machine learning is used to filter out answers that you
are looking for. Also for certain jobs, candidates are filtered out based on articulation and voice
modulation.

Workforce Diversity is another emerging trend. But at Persistent it ‘Diversity, Equity and
Inclusion’ has been a part of their culture since the very beginning. According to the Delloitte
Human Capital Trends Report 2019, DEI leads to 40% better innovation and collaboration
amongst teams over time. Persistent agreed to this, but also added that it does not always work
and it needs to ensure that the employees fit in the culture of the organization.

Persistent also has a perspective of offering ‘Development as a service’. This helps the current
millennial generation who has become extremely impatient when it comes to the work life to
gain insight on the path that they want to take. This has helped increase productivity as it has
led to people knowing what their goals are and being in check with them helps.

Employee engagement and recognition is an important factor in employee retention. However,

Persistent has realized that this is done best when the line manager also acts as an HR manager.
Line managers are trained by the HR department to and a map is chalked out to see how a
particular team can better itself by certain increased engagement strategies tailored to the
specific team.

Other emerging trends include involving employees in CSR initiatives and having an active
community for volunteering. Persistent has also tied up with a fitness app to launch fitness
challenges which can be done individually or with a team (across the organization) which has
seen a lot of success and positive feedback.

Trends in Human Resources

1. Corporate downsizing : Whenever an organization attempts to delayer, it is

attempting to create greater efficiency. The premise of downsizing is to reduce the
number of workers employed by the organization. HRM department has a very
important role to play in downsizing. HRM people must ensure that proper
communication must take place during this time. They must minimize the negative
effects of rumors and ensure that individuals are kept informed with factual data.
HRM must also deal with actual layoff. HRM dept is key to the downsizing
discussions that have to take place.

2. Changing skill requirement: Recruiting and developing skilled labor is important

for any company concerned about competitiveness, productivity, quality and
managing a diverse work force effectively. Skill deficiencies translate into
significant losses for the organization in terms of poor-quality work and lower
productivity, increase in employee accidents and customer complaints. Since a
growing number of jobs will require more education and higher levels of language
than current ones, HRM practitioners and specialists will have to communicate this
to educators and community leaders etc. Strategic human resource planning will
have to carefully weigh the skill deficiencies and shortages. HRM department will
have to devise suitable training and short term programs to bridge the skill gaps &
deficiencies.
3. Mass Customization: There is a lot going on already within HR concerning mass
customization, the optimal combination of mass production with customization.
We’ve seen companies basing employment arrangements on learning styles and
personalities, allowing employees to choose between lower base pay and higher
bonuses vs. higher base pay and lower bonuses, and changing from career ladders
with a straight shot to the top to career lattices where a sideways move is
considered a good career move. Here, HR has done a great job of applying HR
principles to its own traditional functional processes.
HR will need to take the tools of marketing around customization for consumers
and clients and applying them to the task of talent segmentation. The key is to
optimize. At one extreme, a personal employment deal for every individual would
be chaotic. At the other extreme, defining fairness as “same for everyone” risks
missing important benefits of customization, and in fact may be unproductive and
unfair.

4. Decentralized work sites: Work sites are getting more and more decentralized.
Telecommuting capabilities that exist today have made it possible for the
employees to be located anywhere on the globe. With this potential, the employers
no longer have to consider locating a business near its work force. Telecommuting
also offers an opportunity for a business tin a high cost area to have its work done
in an area where lower wages prevail. Decentralized work sites also offer
opportunities that may meet the needs of the diversified workforce. Work at home
may also require HRM to rethink its compensation policy. Will it pay by the hour,
on a salary basis, or by the job performed? Also, because employees in
decentralized work sites are full time employees of the organization as opposed to
contingent workers, it will be organization’s responsibility to ensure health and
safety of the decentralized work force. have family responsibilities like child care,
or those who have disabilities may prefer to work in their homes rather than travel
to the organization’s facility.
5. The Importance of High-Quality Software: At the heart of all these HR tech trends lies
software. High-quality, scalable programs are the secret to success. The reality is that you
don’t have to be making plans for robot assistants or virtual training sessions to want and
deserve the best. You just need a commitment and a passion for workplace productivity.
While tech and software advancements are an essential part of any business process, human
resources is an area that benefits quickly and consistently. There’s a huge amount of data
involved in talent management and recruitment. Half the job is sifting through resumes,
KPIs, payslips, training schedules, employee statements, and more. So, the power to hand
over responsibility for finding, processing, and presenting this information is a valuable
asset. Whether it happens via robotics, wearable tech, or knowledge-hungry machines, the
point is that it saves time and resources. However, it must be grounded in robust, reliable
software solutions. If you haven’t reviewed your existing HRM software for some time,
now is a good opportunity to make sure that it’s still doing enough for your business. Just
because a product was perfect five years ago, doesn’t mean it’s still a good fit. As
companies grow in size and start to take on more employees, their needs become more
sophisticated, and their software should reflect this.

6. Virtual and Augmented Reality : A digital HR management platform allows businesses

to abandon the traditional performance review cycle. There is no longer a need to schedule
time-consuming meetings and limit performance evaluation to a monthly or yearly basis.
With HRM software, employees can receive consistent feedback in real time. Beyond the
logistical benefits, real-time feedback “provides ample opportunity for managers to have
meaningful and forward-looking conversations about professional and personal
development with the employee, resulting in better engagement and improved
productivity,” explains Sushman Biswas for HR Technologist. To put it simply, “it’s more
constructive to engage in an open dialogue on employee contributions throughout the
year.”Feedback will also evolve to see “the increased use of VR for performance
management, assessments and prescreening,” says Charney.
Artificial Intelligence in Human Resource Management:

What is Artificial Intelligence?

Artificial intelligence refers to the simulation of human intelligence in machines that are
programmed to think like humans and mimic their actions. The term may also be applied to
any machine that exhibits traits associated with a human mind such as learning and problem-
solving. Artificial intelligence (AI) is the simulation of human intelligence processes by
machines.

Intelligent Automation:

Intelligent automation combines AI with automation to enable machines to sense, understand,

learn and act – either independently or with human assistance. Intelligent automation can
perform not only manual tasks but also make intelligent decisions as a human would. Intelligent
automation capabilities can enable machines to understand processes and their variations.
Intelligent automation can be deployed across all repetitive manual processes to boost
efficiency, productivity, and drive innovation.

Application of AI in HRM:

The future of HR is both digital and human as HR leaders focus on optimizing the combination
of human and automated work. Today, Artificial Intelligence (AI) is reshaping the way that
companies manage their workforce and make HR plans, which increases productivity and
employee engagement in general. AI has the power to take your HR experience to the higher
level. AI can help you to handle the functions of HR more efficiently than traditional HR
methods. At the same time, it also allows you to do it faster than ever before. In a field that
endeavours to extrapolate useful insights from masses of data and then use these insights to
attract the best possible talent to a company, AI could prove to be the holy grail of assistance,
capable of improving and simplifying almost every phase of Human Resource Management.
From finding the departments needing extra manpower to monitor employees in real time in
order to find outliers at both ends of the spectrum, AI is capable of creating massive savings
both in money and time while simultaneously improving employee monitoring conditions,
leading to a happier more satisfied workforce. Increased investment in smarter HR
technologies has led to some interesting innovations in the AI ‒ HR space. AI is transforming
crucial areas of HR in the following ways:
AI in Training and Development: With so many technological changes happening almost on
a monthly basis, it is crucial for all employees to keep learning and improving professional
skills. AI can successfully plan, organise, co-ordinate training programs for all staff members.
Online courses and digital classrooms are the most common solutions in that regard. But this
is not the only job of AI because it also determines the best timeframe for new courses and
schedules lessons so as to fit the preferences of all employees individually. In the current talent
landscape, where skills have a shorter shelf life than ever before, AI could prove to be the game
changer. AI is enabling learning platforms to replicate the qualities of successful consumer
content platforms like YouTube and Netflix to improve learning outcomes. Some of the key
impact areas of AI in learning and development include:

 Personalised Learning Pathways

 eLearning analytics
 Conversationalist Interface
 Career Pathing

AI in Performance Analysis: Engagement and productivity are essential qualities of

successful professionals. However, most companies are struggling to find individuals who have
those traits. That’s why it is easier to monitor their behaviour and analyse key performance
indicators. Using AI tools, HR managers are enabled to set concrete objectives and let all units
work in smaller increments. This type of work is easier to follow and assess and it generates
better overall results. Of course, it doesn’t only serve to improve productivity but also to detect
team members who show lack of engagement continuously. AI has been a catalyst for how
businesses interact with their employees. Key uses cases include:
 Intelligent surveys
 Real-time feedback platforms
 Rewards and recognition

AI in Employee Experience: HR is there primarily to assist employees, allowing them to grow

and become better at what they do. AI has the ability to analyse and predict the needs of staff
members. Providing them with the means to develop their skills while creating and maintaining
the best work environment possible. But by being forced to work on the menial time-consuming
tasks we have mentioned, HR managers must often shift their focus from their primary role
and spend more and more time on recruitment and administration processes. It is these menial
tasks that AI can flourish at, leaving the HR team to do what they do best – create an
environment that will improve employee happiness and allowing them to develop their skills
and abilities. AI can be effectively woven into the entire employee lifecycle, starting with
recruitment and onboarding, to HR service delivery and career pathing, to provide bespoke
employee experiences.

Decision Making: While HR technology has made real-time data available to businesses,
many still rely on manual methods to draw insights from data. This task is often left to end
users or data analysts. This creates a bottleneck when trying to draw insights – causing delays.
Decisions also continue to be made with outdated information. AI helps HR teams extract
insights from data and deliver recommendations in real time. Natural Language Generation
(NLG) software has the ability to transform data into data-driven text automatically, which
makes it a valuable asset for HR teams across industries. AI also has the potential to remove
many of the common human biases and inconsistencies in a function as sensitive to such factors
as Human Capital Management. Thus, decisions powered by AI have the potential to be faster
at scale and more data-informed, as well as more consistent, and unbiased.

Challeneges in adopting these trends

Although the emerging trends in Human Resources Management have myriad advantages, they
may also have some limitations. Let’s look at these limitations trend by trend:

1. CORPORATE DOWNSIZING
 Financial Cost: Downsizing reduces the amount you pay in salaries and benefits,
but it comes with its own set of costs. Severance packages and payment for any
continued benefits potentially cost the company a large chunk of money at the time
of downsizing, depending on how many people it lets go and what their contracts
say about layoffs.
 Decreased Morale: As soon as the downsizing announcement occurs, company
morale is expected to decline. Employees worry about who will lose their jobs and
how the company will function once they are gone.
  Productivity and Creativity Drops: The workplace becomes a less creative
environment and employees don't make as many bold, creative moves in their work
 Potential for Legal Issues: Even if the company has a valid reason for downsizing,
it faces the potential for legal fallout if any of the terminated employees feel they
were targeted unfairly. Accusations of discrimination or unjustified layoffs leave
the company exposed to expensive lawsuits. It also stands to earn a bad reputation
which could further hurt business.

2. Workforce Diversity
 Ethnic and Cultural Differences: Some individuals who hold prejudice against
people who have different ethnic, cultural, and religious backgrounds as their own.
This prejudice and discrimination should never be tolerated in the workplace.
Internal company policies with clear and objective regulations should be put in
place to prevent employees from demonstrating prejudice. Cultural sensitivities
training and diversity awareness programs in the workplace can help address this
issue.
 Gender Equality: According to a recent survey, 40% of people believe that both
men and women will hire men over women. This is supported by another study that
shows that men are 30% more likely to be promoted to a managerial position than
women. Additionally, men earn an approximately 24.1% higher base pay than
women. In recent years, there has been an influx of women in the workplace.
Employers need to prevent gender discrimination and maintain equality regarding
hiring, salary, opportunities, and promotions.
 Language and Communication: Language and communication barriers are ever-
present in companies with a diverse workforce. This can lead to miscommunication
and productivity loss.

3. MASS CUSTOMIZATION: For employers the creative thinking engendered by the mass
customisation approach may facilitate a more “open” culture within HR, leading to
innovative ways of managing the workforce. Flexibility, however, comes with a cost. Some
arrangements for some employees may be construed as resulting in more valuable benefits
for those employees than others may receive. This could lead to an increase in conflict that
would need to be managed. To avoid that it may be necessary to develop a good
 understanding of the relative costs and benefits of different options to employees and to the
organisation. Some organisations will already have this capability if they operate a flexible
benefits scheme that enables employees to “swap” some income for additional benefits.
4. CONTINGENT WORKFORCE: There are challenges associated with hiring contingent
workers. It can be difficult to find a contingent worker who can not only perform the
required job, but who can also adapt quickly to an organization's corporate culture.
Companies are also often sceptical of sharing insider information with these non-permanent
workers. Organizations can also face legal and compliance issues due to worker
misclassification. If an organization declares someone a contingent worker when in fact he
or she should be classified as an employee, the company runs the risk of paying hefty fines
and penalties. Organizations must be aware of their industry's regulations in regards to
contingent workers before developing a strategy for hiring them.
5. DECENTRALIZED WORKSITES: Part of the reason people are so afraid to use
distributed teams is that they’ve learned productivity methodologies that work much better
in person. It may become difficult due to time differences, ethnic and cultural differences,
lack of personal communication, etc. Work site diversity may result in low trust and
understanding amongst co-workers as they aren’t in the physical proximity of each other.
Due to geographical dispersion, it may hinder the willingness to try new processes.

6. AI: Implementation of AI comes with high costs. The hardware and software need to get
updated with time to meet the latest requirements. Machines need repairing and
maintenance which need plenty of cost. The increasing number of machines leading to
unemployment and job security issues. Also, Robots can only do the work that they are
programmed to do. They cannot act any different outside of whatever algorithm or
programming is stored in their internal circuits. And when it comes to a creative mind,
nothing can beat a human mind. A computer can’t think differently while making or
drawing something. There is no doubt that machines are much better when it comes to
working efficiently but they cannot replace the human connection that makes the team.