The Hard Truths About HR Challenges in 2021

See what HR challenges you can expect in 2021. 

A few weeks ago we looked at HR and employee engagement trends in 2021. Many of them will be in response to what happened in 2020 because of cultural shifts from covid-19 and social movements during the year.

As excited as we are about some of the trends coming in 2021, like improvements to hybrid work models and employee wellbeing, we wouldn’t be giving you a full view of HR in the coming year without digging into some hard truths—the HR challenges of 2021. 

We discussed these hard truths and HR challenges in a recent episode of the Modern People Leader podcast. In this article you’ll get a recap, but tune into the podcast for the full conversation and additional takeaways. 

1. HR needs to collaborate better 

The truth is HR can, and should, collaborate better. This isn’t an easy truth to accept, but it’s a critical one in 2021. Though progress has been made, all teams across the HR function  need to better connect.

To be fair, HR has a very difficult balancing act of being a strategic advisor and tactically executing for business. It’s important – now more than ever – that HR has a seat at the table, but that can’t distract from making HR initiatives stick. 

Since HR is such a multi-faceted department, there are many sub-functions within it which can make collaboration and decision making difficult. Additionally, HR many times is a consensus-driven organization, meaning it needs buy-in from Finance, the C-Suite, and other parts of the business. This often means that groups within HR end up competing against one another for the same resources. 

Ultimately, HR exists to serve the business. But because of being consensus-driven and the scope of responsibilities, it’s possible that HR projects hit a stand still or grind to a halt. To fix this, HR teams have to make sure they’re practicing the same processes and improvements within their org that they’re advising the business on. It hurts the credibility of HR when they talk about improving organizational effectiveness, but aren’t practicing what they preach.

In a year where companies are focusing on establishing a ‘new normal’, the successful execution and implementation of your 2021 programs (like virtual onboarding, return to office, diversity & inclusion, etc) could come down to how well you collaborate within your HR organization. 

2. Getting the most out of HR technology 

Companies often spend thousands of dollars on their tech-stacks. Every year, there’s a new buzz around new features or fads (think employee listening, employee experience, AI / Machine learning) and there’s usually a new suite of tools that are billed as the next big thing. These tools are usually sold as magical fixes for all HR problems, but that’s rarely the case. It isn’t possible to buy one software tool that’ll magically fix all HR challenges and engage employees

We’ve all been guilty of falling in love with good marketing and aspirational tools, only to use them and be let down. As a buyer, remember that there’s never a silver bullet or perfect approach for a business that is so complex as human resources. 

Before buying anything, make sure you have a clear view of what your goals are and what’s most important for your company. Then, you ask yourself some critical questions that will lead you to the right HR technology. What is the problem you’re trying to solve? How will the investment improve your business and what does success look like? Why is this the right investment now and do you have the right team to implement the new technology? 

Every business is unique, and every business has their own specific needs. Think of these needs first before signing up for a new technology, and make sure the tech accommodates what will work for your business. The truly special vendors that end up winning and capturing market share are selling tech that is flexible and can support the unique needs to your business. 

3. HR’s inability to take advantage of the data they have 

2020 was unique in that HR collected more data than ever to understand the impact that the pandemic was having on employees. In fact, HR may have so much employee data that some organizations don’t know what to do with it all. This includes data companies are getting from pulse and feedback surveys, and other rapid feedback channels that have popped up during the pandemic. This data isn’t usually connected in a meaningful way, but what if it was? 

What if retention data, time off data, tenure data, and other points could speak to one another effectively? Companies are definitely making progress but it is still early days for a lot of companies. Finding a way to accomplish this will be even more critical as the importance of people analytics grows.

Once data is better understood, it’ll mean that HR and people analytics teams will have to develop the courage to share their findings to senior leadership. It’s very common that data uncovers harsh truths, and HR teams can’t shy away from what they find. 

To get better at sharing these truths, HR and people analytics teams can build relationships with groups across the organization. Once relationships are built, other teams will know that data is being presented as good-faith help for the business’ best interests.

Always remember to stay customer-focused 

To persevere through the HR challenges of 2021, HR and people teams have to focus on their customer—the employee. It’s often that companies have client-first models where they prioritize their customers, but how often do HR teams forget to take the same approach toward their employees and the business? 

This customer-centric model presents a massive opportunity in HR. It sounds simple, but reorienting the way that HR does things in order to align with business needs and to partner with the business is crucial. As power continues to shift toward employees, the perception your people have on their employee experience will increasingly become the reality, Which is why we believe more and more companies will be shifting to more of an employee-centric approach.

This reorientation could also help address the collaboration challenges discussed earlier.  HR becomes less territorial across the business and its own teams. In turn, that will help HR come to compromises so that critical projects don’t get stopped via organizational ins and outs. Teams can also implement a more agile way of deploying HR, similar to the minimal viable product (MVP) approach that we’ve seen in other business units. 

We’ll discuss more HR trends and challenges in the coming year, and we hope you join in on the conversation with us. Follow our blog and the Modern People Leader podcast to stay up to date.