11 HR Trends for 2016

One year ago, on 29 November 2014, I published “9 emerging HR Trends for 2015”. Many of the trends I mentioned end 2014 were very visible in 2015. The changes in performance management, the transfer to mobile, the use of communities for recruitment and people analytics were on the agenda in many organizations. Some trends moved very slow. The end of PowerPoint seems to be wishful thinking. I have been in many meetings, conferences, round tables and symposia this year, and I must have seen more than 5,000 PowerPoint slides. Most of them of very poor quality. People analytics is moving, but many organizations are still at maturity level 1, where predictive analytics are still far away.
What are some of the trends we see for HR in 2016? 11 HR trends for 2016 trends selected for you by the team of the HR Trend Institute.

1. HR embraces agile
Agile seems to be hot in 2016. Where 2015 was the year of HR Analytics, 2016 will be the year of Agile HR. Conference organizations and HR network facilitators have been brainstorming about the topics for 2016, and looking at the brochures and websites “Agile HR” has often made the shortlist. Fortunately for the organizers, most HR teams have no clue what Agile HR means.

2. Back to the office!
A couple of years ago I visited the Microsoft Office in The Netherlands. This office was state-of-the art, and an example for many. A Starbucks look-alike on the ground floor, and a variety of work spaces for different purposes. Nobody had a personal office. The advice to employees was: only come to the office when you have to meet other people. What we see today, at start-ups but also at established companies as Google, is a different practice. The credo is: please come to the office! Working at home can be lonely, and we want to keep our people closely together. Working in an agile way is a lot easier if you do not have to organize meetings. Lunch and sometime breakfast are offered, and of course on many days there are attractive activities for the staff. Big corporates are moving some of their team into start-up eco systems, to connect and to learn from the young entrepreneurs.

3. HR goes soft on performance ratings
In 2015 some big organizations proudly announced that they were reforming their performance management processes. Deloitte started a very nice marketing campaign with the article “Reinventing Performance Management” in HBR of April 2015. Accenture and others followed, see for example: “Accenture dumped performance reviews, here is why”.
I have very mixed feelings about this trend. Yes, the frequency of feedback should be a lot higher that once per year. Yes, nobody benefits from a patronizing and unequal approach. Yes, assigning people a crude performance rating is not very helpful. But: measuring performance is very important, and the redesign or abolishment of performance management should not mean that one stops with measuring performance as well. Hopefully Performance Consulting will emerge as a trend in 2016.

4. Individualisation
Treating employees as individuals and not as part of a group or segment will be more visible as a trend in 2016. The way organizations deal with employees is still far behind the way organizations deal with clients, but there is movement. HR can learn a lot from marketing.
Today most organizations still segment in simple ways. Young versus old, Gen X, Gen Y and Gen Z, Managers and non-managers and so on. Many untested assumptions are used to design policies and career tracks. “Gen Y wants more work-life balance”. “People above 55 want to slow down”. With big data analysis and with sophisticated algorithms, it has become easier to detect and predict individual preferences of employees, and organizations can act on the insights with tailored programs and interventions.

5. Talent everywhere
Slowly talent management gets a broader scope. Still in many organizations the focus is narrow, on the talent pool inside the organization. “How can we engage and retain our talent?”. The talent pool is broader. More and more talent does not want to be employed by (big) organizations. They are self-employed, and are interested if you can offer a challenging opportunity. Others prefer to work for start-ups. The trend: connecting to talent outside the organization, and design new talent development programs that are also beneficial for these groups. This can be done directly, or through intermediaries.

6. Artificial intelligence
Artificial Intelligence is growing up and also entering the HR arena. 2016 will probably not be the year of ‘Machine Learning’, but the developments are going fast. Example: Personality Insights, powered by IBM Watson. Feed the machine with text written by the person you want to analyse, and Personality Insights gives you a sound personality profile within seconds.

7. Detecting and selecting the best
The trend setters are looking for ways to measure real performance, in order to be able to detect hyper performers. When performance can be measured and connected to individuals, top performers seem to perform 5-10x better than average. Performance measurement is an enormous opportunity for HR. If HR can find ways to measure real performance, and can improve the detection of potential top performers, the business impact can be big.

8. Moving away from Big systems
Big global companies can afford to invest in big expensive core HR information systems. Even these big companies are struggling to implement at a speed that is necessary to follow the changes in the organization, and are struggling to deliver on the high expectations that were set at the time of the investment decision. Other organizations are reviewing if it is wise to invest in big systems. They might be better of to select best-of-breed solutions in different areas, and to find a solution that enables HR reporting and people analytics using the available data out of the different systems. There are many clever solutions on the market. Focused applicant tracking, onboarding, performance management and online training SAAS solutions. And neat and innovative HR reporting and people analytics solutions (as Crunchr).

9. Rewards: less external benchmarking
Some weak signals from the executive compensation front. External benchmarking seems to become less popular. Responsible companies with strong Boards dare to look more at the internal differences. Does it make sense for the CEO to earn 5x-10x-20x more than people in her organization two layers down, even if it is justified by the external benchmark? Is the top team really so money driven that they will leave if the Board decides not to follow the market? 2016 will not show major shifts, but it is worthwhile to follow the executive compensation developments.

10. Maturing of people analytics
People Analytics is maturing. Last year many HR teams were making the first steps. We saw that some teams lack credibility with their top management, and have some difficulty to get funding to accelerate people analytics. Data analytic capabilities are scarce, even more so when you are looking for people with the necessary analytical capabilities who also have some HR domain knowledge. Sharing capabilities with other functions (marketing, IT) can be a solution. Learning a data analyst something about HR can be easier that learning an HR professional about data analysis.

11. Keeping it simple
HR has a tendency to make things too complicated. The trend is to make life simpler. Focus on the most urgent business needs, keep the HR team small and beware of the “Not Invented Here” syndrome. The trend setters are leading the way, and they are showing that HR can have a big impact when they focus on simple solutions with high impact.

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