HR Digital Transformation Guide AIHR
HR Digital Transformation Guide AIHR
TRANSFORMATION
THE PRACTICAL GUIDE
Introduction
From automation to AI, HR’s work is increasingly Every organization engaging in digital transformation will
digitalized. This frees up time for HR teams to move from go through six stages of transformation.
mundane and repetitive tasks to more productive and
At each stage, there are six key components of Digital HR
value-adding ones. It allows HR to become a key driver in
for you to consider and address.
solving pressing business problems.
In this guide, we’ll take you through each transformation
However, leveraging digital in HR is not as simple as
stage and describe concrete action points to improve on
implementing a few technologies here and there. It is a
every component of Digital HR until you have successfully
complicated process that requires time, effort, and
transformed your organization.
resources.
Good luck!
So how do we approach a project of this magnitude? Let’s
find out!
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The six stages of Digital HR Transformation
Together, these six components form the foundation of your successful digital transformation.
HR Technology People
Technology isn't an end in itself. What is important is People can make or break your digital transformation.
that your selected HR technology supports your main You need people with specific skills, guided by strong
business priorities, both within HR and beyond. leadership, who can collaborate effectively for the
project to be successful.
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Stage 1. Business as Usual
Tips
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Stage 1. Business as Usual
HR technology
Current situation
Tips
At this stage, technology barely has any impact on
business and HR processes. Your HR technology ● Assess the current HR technology landscape on
landscape is most likely scattered. Point solutions are not its ability to support the business on people
connected to the HRIS. challenges.
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Stage 1. Business as Usual
Innovation
There is no one-size-fits-all solution for digitizing an HR
department. To find what works best for your
organization, you’ll need to adopt an experimentation
mindset and learn to test different solutions.
Tips
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Stage 1. Business as Usual
HR processes
How to improve Tips
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Stage 1. Business as Usual
People
How to improve Tips
Change doesn’t happen in a vacuum — so it’s important to ● Organize meetings with people inside your team with
get the buy-in of key people within your organization. digital capabilities.
You can start talking to a small group of potential change ● Discuss and note any first ideas on integrating new
agents to build enthusiasm for digital transformation. At digital HR elements in HR strategy and operations.
the same time, see if you can gather people with digital ● Use these ideas as talking points in the session with
capabilities to start experimenting. leadership (see “Strategy & Leadership” on page 7).
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Stage 1. Business as Usual
Your first step is to assess your current HR data availability and quality. After that, you
can gather reporting and analytics requirements from the business. Discuss this with
HRIT and HR analysts to see what you need to do to improve on data and reporting.
Tips
● Work with an HRIT expert (or system administrator, or ● Interview business stakeholders to identify current
external IT or data analytics expert) to go through data reporting and analysis needs.
fields and perform a high-level assessment on data ● Brainstorm with domain experts to identify data and
availability and quality, which can be high, medium, analytics that would improve people processes and
or low. business impact.
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STAGE 2
Present & Active
At this stage, you will probably notice different pockets of
experimentation driving digital literacy and creativity in
your HR organization. Some people connect over their
shared passion for innovation and try to experiment
together.
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Stage 2. Present & Active
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Stage 2. Present & Active
HR technology
Start building a roadmap of HR technology for the future.
This includes supporting standard HR processes using
technology, data management, data integration, service
delivery models, and reporting and analytics.
Tips
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Stage 2. Present & Active
Innovation
Find out which methods could benefit the HR department and the best
ways to train the department on these methods.
Tips
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Stage 2. Present & Active
HR processes
How to improve Tips
To redesign your HR processes, you need to start with ● Create a high-level employee journey map.
identifying your key objectives, which could be: ● Collaborate with domain experts, IT, and possibly
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Stage 2. Present & Active
People
How to improve Tips
To execute your desired improvements, you will need to ● Hire 1 or 2 digital talents for short-term success (might
train and/or attract people with digital capabilities, such be interim) & train selected few for future skills.
as HRIT specialists, HR analysts, technical consultants, or ● Identify business issues & create an impact-effort
software developers. matrix. Focus on high-impact, low-effort issues.
Work with other departments to implement new ● Learn by doing & form a few multidisciplinary project
approaches where possible. This could be a data teams to achieve small changes with big impact.
warehouse, a KPI dashboard, or collaboration tools.
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Stage 2. Present & Active
are crucial for decision-making. analyst, and decide on a specific and current
challenge they are facing.
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STAGE 3
Formalized
This stage is all about intentional experimentation.
You will notice initiatives becoming bolder, which
requires executive support for new resources
and technology.
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Stage 3. Formalized
Tips
Use examples to make a compelling Be specific about what you need from
1 3
case for resource allocation. leadership and why.
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Stage 3. Formalized
HR technology
How to improve Tips
It’s time to buy and/or build new technological solutions ● Be specific about business and user requirements if
to replace legacy systems. When you select you want to replace or buy new technology.
replacements, make sure to be specific about business ● In large key technology replacements, choose a
and user requirements before deciding on your exact capable implementation partner.
strategy. If you’re implementing key technology, consider
● Make sure to be precise about data requirements and
working with an implementation partner.
data collection protocols for every technology
Don’t forget to keep experimenting with new tools! This is replacement or addition. This can affect the future
how you can improve collaboration, dashboarding, functionality of your tools.
employee experience, and project management.
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Stage 3. Formalized
Innovation
How to improve
Tips
HR processes
How to improve Tips
Start systematically cleaning up HR processes. This ● Continuously measure process efficiency and
means you’ll need to: employee experience by analyzing system data and the
time necessary to complete each step.
● Eliminate non-essential time-consuming steps.
● Regularly discuss process efficiency and impact with
● Automate essential time-consuming steps (if
domain experts and managers: Where do they think
technologically possible and permitted by privacy
improvements can be made, and how can
laws).
automation help?
From there, you can continuously assess the employee
● Communicate and train people involved in the process
experience and implement potential improvements.
to execute the new and improved process properly.
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Stage 3. Formalized
People
How to improve
Tips
Once you have a clear understanding of the digital skills
gap in your organization, it’s time for action. Start building ● Identify the skills gap.
new training programs to improve digital literacy. Make
● Train for digital expertise, design thinking, and
sure your colleagues understand and can apply these
customer-centricity to enable people to get the
new skills.
most out of technology and innovation.
If there are certain skills you can’t train for in your ● Explain and communicate the added value of these
organization, identify what digital expertise you currently digital skills for the organization and
have and what you will need to outsource or hire new the employees.
people for.
● Actively build data skills among your strategic HR
Business Partners.
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Stage 3. Formalized
You can create a service delivery model to deliver HR ● Collect business needs for structural delivery of
information, insights, and advanced analyses. Team up people insights.
with IT and other departments to systematically enrich ● Decide with your team what needs to happen on the
and improve data. You can also consider building a following topics to meet these business needs:
prototype dashboard (using a tool such as Tableau or
○ Dashboards and reporting
PowerBI) for a key strategic theme.
○ Data
When you create a plan for any new dashboards,
○ Skills
processes, and roles, keep in mind that your goal is to
○ Processes and governance
deliver people insights that support the business.
○ Roles and responsibilities
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STAGE 4
Strategic
In this stage, HR teams recognize the strength in
collaboration. This is because their research, work,
and shared insights all contribute to digital
transformation, ownership, efforts, and investments.
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Stage 4. Formalized
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Stage 4. Strategic
HR technology
How to improve
Tips
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Stage 4. Strategic
Innovation
How to improve Tips
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Stage 4. Strategic
HR processes
How to improve Tips
Start looking for ways to have HR processes ● Create highly detailed employee journey maps.
‘communicate’ with each other to optimize business ● Discuss this integral approach with domain experts
impact, the employee journey, and employee experience. and business stakeholders to determine the best way
To this end, you will need to create in-depth employee to add value by linking HR processes.
journey maps. ● Involve vendors and IT to plan for a first experiment
where two HR processes are linked and add value.
Work with domain experts and business stakeholders to
determine how to best add value by linking HR processes.
For example, you can directly link performance
management goals with L&D offerings, and let strategic
workforce planning goals feed into talent
acquisition efforts.
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Stage 4. Strategic
People
How to improve Tips
By this point, digital literacy should be a mandate across ● Provide regular inspiration & follow-up on new initiatives
all groups working within HR, including executives. (e.g. weekly live updates, newsletters,
Integrate digital skills within all roles in HR and plan for posters/infographics).
the future by attracting key digital talent. ● Celebrate successes, and discuss lessons learned from
follow-ups and inspiration. Make sure to celebrate ● Integrate a digital skill set in all HR recruitment profiles.
successes and discuss lessons learned.
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Stage 4. Strategic
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STAGE 5
Converged
It’s time to form a dedicated digital transformation team to
support HR strategy and operations. Make sure to focus your
activities on business and customer-centric goals. The new
infrastructure of the department will take shape as you
determine the roles, expertise, models, processes, and
systems needed to support digital transformation.
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Stage 5. Converged
Be sure to regularly align with business developments and ● Stay in touch with internal and external customers
needs within your new HR operating model to boost through HR business partners and/or HR advisors.
digital transformation. You will need to integrate these They need to gain input on business developments and
new digital components into your people strategy. Don’t align people challenges and solutions accordingly.
forget to also team up with IT leaders on new plans for the ● Once business developments require a new approach
future. to the organization of people, you can create a nimble
You can consider creating temporary cross-functional team to tackle that challenge with a custom solution.
teams to experiment with new ways of working and ● Consciously work towards enabling individual
innovative ideas. customization to achieve the workforce of one.
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Stage 5. Converged
HR technology
Work towards an integrated set of platforms and tools to suit every need on
people issues. Make sure all relevant HR tools are easily accessible for employees,
management, and executives. These tools should provide real-time information
fed by one single data source. You can partner up with IT and vendors to make
this possible.
Tips
● Exchange of data is crucial to deliver value for the ● Develop smart algorithms (with data scientists and
organization and employees, so work with IT and vendors) that combine information from different apps
vendors to create a situation where any data can and platforms to deliver suggestions and custom HR
(safely) be accessed by any HR-related app or solution. services to both employees and teams.
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Stage 5. Converged
Innovation
How to improve Tips
Although innovation might be more streamlined and ● Leverage Organizational Network Analysis as a tool to
formalized at this stage, pockets of experimentation are spot opportunities for collaboration and networking.
still important and crucial to keep it new and fresh. ● Prompt internal communication between departments
Encourage working in hybrid teams to solve specific through events and liaison roles.
people issues. It’s a good idea to form teams around HR ● Identify innovative thought leaders within the
thought leaders to stimulate their ideas. You should also department & form teams with them to pilot ideas.
make sure that there is time for people to come up with ● Encourage people to make good use of their time to be
and work on new ideas. creative, develop, and pilot ideas.
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Stage 5. Converged
HR processes
Use quick pulse surveys to gather feedback from
employees and business stakeholders on the
effectiveness of your processes. You can then use this
input to optimize HR processes, HR effectiveness, and
employee experience.
Tips
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Stage 5. Converged
People
How to improve Tips
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Stage 5. Converged
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STAGE 6
Innovative &
Adaptive
Digital transformation is now a continuous process in
your organization. Your business relies on HR to provide
the best digital solutions for their challenges. You will
need to establish a new ecosystem to identify and act
upon technology and market trends.
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Stage 6. Innovative & Adaptive
How to improve
● Build methods for continuous listening in HR and ● Build KPIs that provide the necessary feedback on the
HR technology
How to improve
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Stage 6. Innovative & Adaptive
Innovation
It’s now time to make HR innovation a continuous process Tips
rather than a one-off program.
● Create extra roles for those delivering outside-in
To achieve this, you should encourage an innovative inspiration, connection, innovation, and ideation.
mindset by creating time and resources for new Networking will help them gain access to promising
approaches and collaboration. Keep everyone focused on startups and frontrunners in the HR innovation field.
the right goal by identifying value-adding innovation KPIs
● Identify relevant innovation KPIs that add long-term
and driving intrapreneurship.
value to the business. Commercialize your innovative
capacity.
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Stage 6. Innovative & Adaptive
HR processes
How to improve Tips
Think about how you can optimize your EX in such a way ● Analyze system and business data to discover
that HR processes are practically invisible. This will distinguishing patterns and profiles in the organization.
ensure that users of digital solutions enjoy their ● Find out how to customize HR processes to meet the
interactions and your employees are happy to share data. needs of different groups within the organization.
Analyzing data will also help you understand
organizational patterns and profiles.
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Stage 6. Innovative & Adaptive
People
Make a person or small team responsible for the continuous delivery and growth of
innovation within HR. You can do this by networking with interesting third parties,
suggesting innovative ideas for people challenges, and challenging current solutions.
Regularly ask for your innovators for input on skills that will be needed within HR in the
future. Continuously review the talent gap for digital skills within HR.
Tips
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Stage 6. Innovative & Adaptive
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