DIGITISATION OF HR IS GROWING ACROSS ASIAOctober 3rd, 2017
BY POORNA RODRIGO A GROWING trend of digitising HR – or simply put, developing human resources using machines - is sweeping Asia’s HR sector. And it has brought with it many challenges and risks that the industry need to take note of, experts warn.
Using simple automation or more advanced artificial intelligence (AI) – where machines can simulate human intelligence – to perform HR jobs such as hiring, developing and engaging workers, has resulted in massive productivity gains. Consequently, it has made HR decision making more data-based rather than intuition-based and “Asia has certainly embraced digitisation,” global law firm Evershed Sutherland’s head of Hong Kong and Asia Pacific employment practice Jennifer Van Dale said.
A 2017 Deloitte Global Human Capital Trends report backed the trend saying that 79% of companies in Asia consider digitising HR as “an important or very important trend”.
Countless benefits of digitising HR explain its uptake. For example, a digitised HR system can help “align workforce strategy and business strategy, identify stress points to reduce turnover, and identify capability gaps for hiring, firing, learning and development,” Ms Van Dale said. “Imagine if we had employee analytics that were as sophisticated as our customer analytics?” she asked.
Another major benefit is that AI can also help identify unconscious bias in interview questions and recruitment efforts, Van Dale said, adding that it streamlines routine tasks such as answering common questions and scheduling meetings and interviews and “when these tasks are automated or AI-assisted, it frees up HR leaders to do more strategic and valuable work,” she explained. That strategic work is also likely to be supported by data analytics, such as analysing teams that cut across departments or geographic locations and identifying who are the most productive teams and why, and how such teams can be replicated – all of which help companies to thrive.
Using an app (application) to capture attendance and routing it to payroll to handle payroll and OT claims is a further form of digitisation, said Liu Wie Hua, general manager of HR specialist Alchemy Resources with offices in Singapore and Malaysia. “This reduces mistakes and makes the process seamless and very efficient especially in certain sectors like food and beverage and health care,” Hua said.
Dr Bob Aubrey, Chairman of the HR Committee of the European Chamber of Commerce (Eurocham) in Singapore and senior advisor for Asia to the European Foundation of Management Development, said that the Eurocham HR committee too has focused on technology this year. The committee organised a meeting at IBM to look at how to go from engagement to employee experience, which is a big change and also discussed the impact of AI, he said.
“For IBM the function of HR is fundamentally changing as HR becomes a facilitator for better employee experience. Also, the learning function is being fundamentally changed with the capability to personalise learning using algorithms,” he said. The committee also talked with global software manufacturer SAP who are further digitising their HR platforms and have internally changed the Human Resources Business Partners (HRBPs) function – from one where managers work with one person with whom they meet, to being serviced by networks of HRBPs that may be anywhere and that they may never meet. “We discussed with our HR committee whether this was a good thing or not,” Dr Aubrey said, although a decision has yet to be made.
However, across the ASEAN region, the uptake in digitisation varies. More advanced economies like Singapore and Hong Kong with a larger proportion of tech-savvy population are banking on digitisation, Ms Van Dale said.
Dr Aubrey agreed. While Singapore and Hong Kong are leading the way in digitising HR, it is happening to a lesser extent in Malaysia. Of course, this varies from some companies, like the high-tech firms and the big multinationals, who are far advanced, while some companies haven’t started, he noted.
Obviously, there are barriers to digitisation and the biggest one is often “around our mindset,” Ms Van Dale argued. “I believe we need to see technology as an opportunity and a tool rather than a threat. We also need to move away from the idea of a traditional job with a fixed job description,” she said. For example, if jobs are broken down into all their components, it’s possible to identify which ones need people and which can be automated, she explained. By “mixing and matching functions with people and AI, we have an opportunity to improve productivity exponentially,” she said, adding that it helps raise employee engagement significantly so staff feel supported by the technology rather than feeling that they will be replaced by robots.
But she warned against “over reliance” on machines, adding “machine learning sometimes perpetuates bias”.
According to Hua, companies’ reluctance to go digital is due to ignorance and being scepticism over the cost/benefit ratio which leads management to doubt the effectiveness of HR Tech.
And while, costs of adaptation have been high, with the software-as-a-service (SaaS) a category of cloud computing) being cost effective, more companies are willing to try out the system.
Given the speed with which digitisation is happening “I haven’t seen a lot of real preparation for this disruption inside companies,” said Dr Aubrey, who called for HR professionals to show leadership in driving the development.
Asia especially can be a challenging place for this transformation. “Some places in Asia are still rooted in traditional practices such as not leaving before the boss leaves, or refusing to let staff work from home because there isn’t any way to check if they are “really” working,” Ms Van Dale noted. As organisations become more concerned with output, they will need to move away from ‘presenteeism’ and towards more flat structures to stay ahead of the game, she added. “A digitised HR function can help an enterprise move away from these traditions and into the future of work.”