The Power and Promise of HR Automation

Long gone are the days when HR was viewed largely as a cost centre, focused squarely on transactional tasks such as filling job requisitions and implementing annual reviews. Seismic workforce shifts—from boundaryless ways of working to a tight talent market to technological breakthroughs—have supercharged HR’s ascent to a more strategic perch. Increasingly, this critical function is seen as a critical driver of value creation.

HR leaders now increasingly find themselves in more strategic roles when it comes to improving the overall employee experience, pushing forward high-visibility diversity, equity, and inclusion (DEI) undertakings, and overseeing upskilling and reskilling efforts. Sometimes called “outcome-led HR,” these tasks are about improving the business, not just keeping the operation running. 

Here’s the dilemma: While HR’s scope and strategic value has expanded, departmental budgets and headcounts have not. As a result, many HR leaders are tapping the huge potential of technology to automate processes and tasks related to recruitment, compensation, and appraisals. And they’re also embracing new digital tools embedded with artificial intelligence (AI) and machine learning (ML) capabilities to support more advanced data analysis, interpretation, and decision-making.

IDC’s new report, “HR Automation Self-Assessment Workbook,” is specifically designed to guide organisations toward this outcome-led HR transformation. The ebook, geared toward HR executives and managers looking to enhance efficiency and productivity via streamlined processes, addresses what it will take for organisations to tap the value of automation.
 

Roadmap for Change

Fortunately, many businesses are willing to invest in HR technology to advance outcome-focused transformation. Across 10 different surveyed business functions, HR had the highest share of leaders—23%—who said they expect double-digit growth in their department’s tech spend, according to IDC’s 2022 C-Suite Tech Survey.

Regardless of sector and enterprise size, the value HR can create for the business is increasingly intertwined with and driven by technology. Two out of three HR leaders in EMEA say the most important evolution of their role is assuming HR technology leadership such as through learning, employee engagement and HR automation technology, IDC’s survey found.

As an example, Ferring Pharmaceuticals’ HR department has adopted skills mapping, development capabilities and a gig marketplace approach through Workday Skills Cloud and Workday Talent Marketplace, respectively, both part of the company’s human capital management software platform. Ferring managers easily post short-term projects to the marketplace, attracting workers with the right skills and professional development interests—a win-win in terms of both employee engagement and business agility.   

IDC’s HR automation ebook is built around the organisation’s HR Automation Maturity Assessment, a tool that addresses the technical and organisational changes that HR departments must adopt to effectively embrace automation and achieve strategic goals. IDC’s HR maturity model maps capabilities, processes, and workflows to three stages: 

• Transactional: Mostly reactive, focusing on administration and compliance, with largely manual processes.

• Transitional: Some automation beyond core processes and a focus on process improvement. 

• Outcome-led: Proactive strategies and agile workflows are already in place, supporting a clear focus on business outcomes and the employee experience.

Along with helping HR departments determine where they are from an automation maturity standpoint, the ebook also focuses on five key areas for improvement: workforce operations; attraction and retention; workforce transformation; measurement, insights and agility ; and future-proofing the HR department—with recommendations for tasks in each category that are ripe for automation.

“This shift towards more advanced automation in all the steps of workforce transformation not only leads to greater efficiency but also enables a more personalised and engaging employee experience as career development is a key driver of job satisfaction for European employees,” says Ivan Oz, senior research analyst at IDC.
 

Gaining an Advantage

Leveraging automation, however, isn’t simply about efficiency. Take workforce management, which encompasses a range of foundational HR processes including payroll, attendance, and scheduling. HR departments operating in transactional ways—with personnel records siloed across fragmented systems, manual payroll processing and no employee access to schedules—have significant opportunities to turn workforce management into a strategic activity that informs decision-making. 

With workers’ data and administrative processes run through one centralised platform, HR can leverage AI and predictive analytics to unlock real-time insights and flag issues that range from staffing shortages and workforce absenteeism patterns to lagging performance review schedules.

Meanwhile, self-service portals that give employees scheduling functionality such as the ability to swap shifts or schedule PTO can become a competitive upside. In industries like retail and hospitality that are struggling with sky-high turnover rates, digitised employee-focused HR services can help HR departments attract and retain workers, a struggle for more than half of European companies, per IDC’s 2023 European Enterprise Applications & CX survey. 

And as IDC’s workbook uncovers, there is a real opportunity cost to sticking with a transactional HR status quo. “Core HR, as well as time management and payroll, are foundational processes that—until they are partially or fully automated—will consume most of HR’s time,” says Bo Lykkegaard, associate vice president at IDC. “The good news is that HR platforms can effectively be used to automate.”

Being freed from time-consuming, manual tasks allows HR staff to focus on higher-value tasks. By embracing a core platform designed to support outcome-led HR, organisations also gain an up-to-date, trustworthy data repository that can support day-to-day duties such as retention and engagement efforts, and DEI reporting. 

While the transformation to outcome-led HR may not be easy, it is an increasingly necessary and inevitable part of the journey for any HR department to meet evolving business demands. 

Read the ebook to guide your organisation through using automation to transform the HR function into an outcome-led operation.