Career & Jobs

Companies At The Edge Of Chaos: Why HR Must Embrace Data Beyond Surveys To Reinvent Organizations

As the way we live, operate and work start to change for good in the new century, organizations are searching for ways to become more future-ready. CEOs are fiercely pushing the dial on several organizational elements with the intention to make numbers grow while CHROs are working diligently to meet changing requirements without breaking the system. The question continues to linger in the back of today’s professional’s minds is whether one can actually transform organizations at the edge of chaos by simply pushing forward.

Despite the efforts, research suggests the business-as-usual approach rather results in an organizational paralysis filled by thousands of confused and consumed people being pulled and pushed in multiple directions. Therein lies the current challenge for practitioners: Today’s organizations are set up with traditional structures, operating and management tactics such as coordination, hierarchy, matrix, etc. that root back to the industrial revolutions of the 18th, 19th centuries. When we don’t step back to redefine purpose as a whole and instead simply keep putting out new remedies in the name of transformation, it brings higher levels of complexity into the current system, making it hardly impossible for people (and adopted new approaches) to function.

What Must Be Changing?

Shifting From Hierarchy To Collective Wisdom

The first thing that needs to change is the way work is structured. The mechanism for organizing work is usually siloed or matrix and is quite averse to immersive thinking. The traditional hierarchy doesn’t only box people in, but it also doesn’t allow for cross-sharing nor for pattern recognition within the collective system, leading to missing out on breakthrough trends and ideas in the market.

The alternate approach is disintegrated structures that allow for the collective wisdom of all its stakeholders. These structures are sometimes referred to as flat or dynamic structures. Here, instead of a particular authority making the majority of decisions, all parties involved in problem solving work through consensus-based decision making on what the company needs to do or adapt as they collectively move forward. This explores the wisdom of all sections of the company and promotes trust, shared accountability and joint, creative thinking.

Since there are many skeptics around letting go of authoritative power, it is important we mention that companies that make decisions at the right organizational level and that have fewer reporting layers are more likely to deliver consistently on quality, velocity, and performance outcomes and thus outperform their industry peers.

Shifting From Bureaucracy To Emergence

The second element is the way work is coordinated. Because many roles are becoming disaggregated and fluid, work will increasingly be defined in terms of skills. Out with the days of bureaucratic coordination even if it provides a sense of direction, logical processing and assigned authority. In the current environment of constant change, ambiguity and volatility, pre-penciled coordination slows down operations, disempowers people and feels tedious and monotonous to the collective.

The other possibility is to draw a structure that allows for emergence at least, when necessary. This type of structure allows for spontaneous coordination through the self-interested behavior of independent parties. Instead of playing by hierarchy, formal authority and given rules, employees use their own network, knowledge and proven skills with conscious as necessary. This tends to promote higher motivation and energy for the workforce by the virtue of changing lines, scope and task and drive better value for the end customer/ user.

Shifting From Linear To Dynamic Goals

Then comes, the way we define and set objectives. Many companies have been experimenting with a wide variety of approaches to improve their performance management systems. Unfortunately, and once again, patch-working is predominant in this field (i.e., no more calibration meetings while continuing to utilize ratings).

Today’s executives mostly have been taught of a linear arrangement for objective setting, which means there is one, quantifiable objective or a quarterly target keenly related to one’s specific task and often supports a higher goal which the entire company is working towards. While such arrangement is often viewed as simple and easy to track – especially by shareholders, what this promotes is a short-term thinking and taking away the possibility of flexibility and renowned purpose. Jeffrey Pfeffer, a management thinker at Stanford University says often that we have learned well to measure the wrong things (volume vs. value), at the wrong time (long-term vs short-term) with the wrong purpose (control vs. inspire).

Dynamic goals, on the other hand, help people focus beyond specific tasks or projects and on the valued outcomes. Sometimes, this may come in the form of meeting a financial target and other times, it may be related to working with colleagues in different geographies, customer or supplier networking, community enriching or collaboration finding in the market. Though this may not feed the perceptual need of exponential growth by companies, it is proven to support sustainable development.

Shifting From Extrinsic To Intrinsic Reward

The last element is how we think of work motivation. We know through years of research that people don’t leave jobs for pay, they leave in reach of better purpose, growth, and inspiration. Yet, companies continue trying to motivate people through extrinsic factors such as high salary, bonuses, promotions, etc.

Intrinsic motivation is defined as the doing of an activity for its inherent satisfaction rather than for some separable consequence. The three core human motivators of behavior can be interpreted as a sense of clear purpose, space for autonomy and connections to develop mastery beyond current confidence. When intrinsically motivated, a person is moved to act for the fun or challenge entailed rather than because of external products, pressures, or rewards, they’re able to perform better.

Where Is HR In All Of This?

To drive and facilitate these sorts of organizational redesign work, HR must clearly transform itself first. People is consistently ranked as one of the top priorities from executives in studies, yet many HR organizations are either not equipped to lead such organizational work or the function is frequently overburdened with transactional work shadowing their position to create additional value for the enterprise.

There is one key skill HR must gain immediately, however, if we are serious about looking at business opportunities with a new set of lenses and despite the current circumstances: the ability to bring data-driven insights to decision tables.

The function can arm itself with data-driven insights, people analytics and anecdotes to develop a unifying cultural purpose and to design an experience-driven transformation model. The good news is there are now several companies that offer nuanced support on building data and analytics strategy and/ or help organizations digest and understand their internal data for the benefit of designing new experience.

Textio, as an example, helps people write effective workplace feedback. It then measures differences in the kind of feedback received by different demographics and departments in your organization and lets HR leaders explore patterns and inequities. Textio also automates some of the data science for an organization by automatically pulling out the most impacted groups within an organization’s data. For organizations interested in reinventing their performance management system, they have industry reports showcasing common biases in performance feedback to help shape your thinking.

The future of work doesn’t have a specific start and end date. It’s a continuous journey of designing, applying, learning and adapting.

If HR wants to be a valued member and pride itself on the business outcomes, then, HR needs to shift from measuring inputs to leading end to end reinventions and holding self-accountable for not only broad shared volume-based results, but also for the value based experience created – namely, the way people feel seen, heard, cared for and rewarded inside the organization everyday.

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