HR Skills: Build a Strategic and Impactful HR Function

Since the beginning of the pandemic, HR functions face greater demand for support: Fifty-five percent of HR leaders say they receive more requests for help on a wider, more complex variety of topics than before the pandemic. As such, HR staff are under pressure to expand their expertise, sometimes into unfamiliar areas.

Gaps in expertise are frustrating for many CHROs who have invested in upgrading their teams’ capabilities in recent years. The problem? It's not enough. The breadth of expertise needed to fulfill HR’s growing portfolio of responsibilities is expanding faster than HR can handle through internal development alone.

Many of these responsibilities are in areas where there is no proven practice — or where HR may have related expertise but no applied experience. Generative AI, for example, has massive implications for the workplace, but few HR professionals understand it at a sophisticated level, and its impacts are not yet fully known. New technologies, volatile economic conditions, social and cultural conflicts, and other hot-button issues are all landing on HR’s plate, but HR employees may not have the background to handle them effectively.

To address these new challenges, CHROs must shift from just expertise development to augmenting HR with external expertise. This requires going beyond their team’s internal capabilities to find ways to regularly incorporate knowledge and ideas from outside the function into HR’s work.

Just 58% of HR leaders believe their function is viewed as a strategic partner to the business. To attract and retain HR talent, HR leaders must assess their employees’ competencies and provide opportunities for them to develop skills that will be necessary for growth in their current and future roles. HR leaders must focus on six core competencies to be successful in their current roles:

• Business acumen: The ability to work effectively within the organization’s financial and operational context

• Talent management: The ability to identify, support and execute HR activities of strategic value to the organization and meet employees’ needs across the employee life cycle

• Data judgment: The ability to handle, analyze, interpret and communicate data effectively and responsibly to drive business outcomes

• Relationship management: The ability to build relationships and coordinate effectively among a wide range of stakeholders and collaborators

• Strategic consulting: The ability to develop and execute solutions to business challenges and to influence strategic business decisions

• Agility: The ability to respond to shifts in the business environment, adapt and change course when necessary

But the above expertise is needed faster than HR can build it. Today’s capability mandate means finding ways to regularly incorporate knowledge and ideas from outside the function into HR’s work. This can be done in three ways:

1. Permeable HR talent movement

2. Collaborative experimentation

3. Integration of external ideas

With permeable talent movement, HR professionals can accelerate the development of their business acumen and be taken seriously as strategic partners, without having more exposure to the organization beyond HR.

Only 30% of HR leaders believe their current structure allows them to adapt to changing business priorities. In response and in conjunction to augmenting expertise, HR must transform its operating model to enable the function to operate with agility, strategic alignment with the business, and operational efficiency.

The new HR operating model is driven by four imperatives that impact the roles and skills within the HR function:

• Build a robust HR operations and service delivery team. A centralized, dedicated team, led by an HR COO, serves employees and managers with infrastructure and processes to carry out day-to-day operations.

• Reinvent the HR business partner (HRBP) to be a strategic talent leader. HR leaders align with specific business units to serve as their de facto CHRO, and partner with business leaders to address the unit’s strategic talent priorities.

• Create a dynamic pool of HR problem solvers. The heart of the HR function, problem solvers apply project management and critical thinking skills to short-term HR-related projects.

• Provide agile support with next-generation centers of excellence (COEs). As problem solvers deliver timely agile solutions and technology meets employee needs, COEs will become smaller and bring on contractors and consultants as needed for deep HR expertise.

Strategic talent leaders

Strategic talent leaders are an analytically oriented, VP-level evolution of the HRBP, focusing on HR’s strategic priorities. They identify the most pressing talent opportunities and challenges throughout the organization and are aligned with a specific business unit or function, owning talent management strategy for that group.