Despite budget cuts brought on as a result of the recession, smart HR leaders will find ways to protect high profile strategic initiatives so that the HR function can still improve organisational capability.
David Creelman, CEO of Creelman Research, said the most direct impact of the downturn on HR will be smaller budgets.
“These will inevitably favour less interesting transactional HR activities which have to be done, over strategic initiatives which, however valuable, are still optional,” he said.
The bigger question for HR is how the downturn is changing CEOs, and Creelman said sceptics about the war for talent and engagement will now make a case that these are fluffy ideas that distract managers from the business.
“I don’t believe CEOs will abandon their belief that human capital is critical, however, there will be less unquestioning enthusiasm for anything labeled as talent management,” he said.
“CEOs will say: ‘Yes, we believe that engagement matters, but show me how this specific initiative will impact engagement and show me what impact improved engagement will have in this particular case.’”
Creelman also said that HR leaders who are not able to step up to today’s challenges would have two main career paths.
One is to simply stay in traditional mid-level positions where new skills are not required, as he said HR will still need people who are good at managing transactional HR or working in a relatively narrow niche like instructional design.
The other career path is to find work in companies that don’t care much about HR.
“There will always be organisations where the CEO isn’t looking for a dynamic HR leader keen to apply the latest thinking; they just want someone to make sure the payroll is done. These won’t be the most exciting jobs but they won’t be demanding either,” he said.
“However, I’m hoping lots of bright people who might have pursued careers in finance or engineering or chemistry will realise that the methods we have for getting the most out of people in an organisation are powerful and exciting and are worthy of the attention of our best minds. We don’t need our brightest people playing games in the financial markets, we need them in HR.”