The last decade brought an avalanche of change to the HR industry and HR software in particular. The rise of artificial intelligence. The growth of the gig economy. The increased push towards greater diversity. And many other headline disruptors. As we turn the page into 2020 and a new decade, it’s only appropriate to look ahead for a glimpse of which HR trends will continue to drive transformation and which new trends will emerge to shape the future of work.
- The presence of AI doesn’t devalue human work but makes it more focused and strategic.
- Virtual and augmented reality can be applied to improve recruiting and training efforts.
- Over 50% of HR leaders are prioritizing the employee experience in 2019.
- HR will become more focused on offering guidance in 2020.
- More than 80% of Millennials and Gen Zs show an active interest in joining the gig economy, either with a side hustle or as full-time freelancers.
- “The average HR function uses 11 different systems just for recruiting.” – Matt Charney
The Trends We’ll Look At
- Automation via AI and RPA
- Virtual and augmented reality
- Employee experience
- HR guidance
- Real-time performance feedback
- The new way to work
- Generational shifts
- Worktask planning
- Wearable tech
- Greater integration capabilities
10 HR Trends for 2020
Digital innovation and disruption is nothing new. But perhaps what is new is the emphasis companies are placing on digitally transforming HR. Gartner’s Brian Kropp points to this urgency when speaking to the main challenge facing HR leaders:
“In a recent survey, two-thirds of business leaders told us that if their company does not digitalize more by 2020, it will no longer be competitive… We found that 88% of chief HR officers say they need to invest in three or more technologies over the next two years.”
Companies that don’t transform will, sooner or later, get left behind by those that do. While this applies to developing a digital transformation strategy that will stick, it extends beyond technology to tackle people-centric issues as well.
Understanding industry shifts is crucial to keeping pace with the rapid developments taking place. To that end, we’ve consulted industry leaders and experts to learn the top HR trends for 2020 so you can make informed decisions for your organization.
1. Automation Via AI and RPA
The influence of artificial intelligence should come as no surprise — it’s been a hot topic for several years now, making regular appearances in predictions about future HR trends. However, we still expect it to play a major role in HR heading into 2020.
Research has pointed to the ways in which AI can can aid the recruiting process and shown where it’s less effective than humans (see graphic below for an example).
One advantage of AI is streamlining redundant, time-heavy tasks. “Our new research shows that AI tools are better than humans at analyzing employee surveys,” says Ben Eubanks, an HR industry analyst and influencer.
Instead of relying on an HR professional to pour over hundreds of resumes and cover letters or compile and analyze survey data, businesses can use an AI system to complete the task quickly.
Another benefit of using AI for such tasks is removing human bias or error from the candidate evaluation process. However, while great in theory, the idea of unbiased hiring has drawbacks and has been a point of much debate. IMB points out that bad data can lead to built-in bias, essentially programming the algorithms with human bias, even if it’s unintentional. This perpetuates the issue and makes it harder to notice upfront.
“As we work to develop AI systems we can trust,” IBM says, “it’s critical to develop and train these systems with data that is unbiased and to develop algorithms that can be easily explained.”
Despite shortcomings, AI tools have the ability to support merit-based selection that eliminates conscious or unconscious bias. With the assistance of AI, HR departments can gain accurate analysis of employees from application submission to continuing performance reviews.
AI use cases have also moved into other realms of HR as well, including recognition, wellness, digital coaching and development planning, per a 2019 ISG report. The IBM Watson Career Coach is one such example of how AI can be a tool that provides ongoing support to employees.
For those worried about a future where AI displaces humans, Eubanks believes an AI-enabled workplace will still require human skills. He says that research for his book “Artificial Intelligence for HR” pointed toward “five key skills that kept surfacing over and over again as critical differentiators in the ‘humans versus machines’ future we’re inevitably moving towards.”
These skills — 5 C’s as Eubanks calls them — are:
- Critical thinking
AI programs and other robotics can only replace humans to a certain extent. In Eubanks’ view, businesses need to focus on incorporating these 5 C’s in preparation for greater workplace automation.
“Every time work has been automated in the past,” he says, “the resulting jobs and tasks have been more human in nature as we automate the less human aspects. These core human skills are important today, but they’ll matter even more in the future.”
A Forbes article by Emily He of Oracle agrees with Eubanks’ assessment. “The fascinating part of this AI revolution,” she writes, “is how automation is actually pushing the workforce to become less techy and more human.”
Eubanks concludes, “There’s a clear demand for humans in these [HR] processes to take action, support stakeholders and so on. So even if AI is making advances, humans still have a critical role to play.”
Robotic Process Automation
Robotic process automation (RPA) is a catchall that encompasses robotic skills like chatbots, natural language processing (NPL) and machine learning, as well as AI. It can speed up communications and increase productivity by providing access to the right data at the right times.
When looking at future trends in human resource management, chatbots are certainly a frontrunner. Many vendors are already incorporating chatbots into their HR systems to provide answers to employee inquiries, and Chatbot News Daily predicts that HR chatbots will be implemented at more than 50% of companies by 2022.
In a Forbes article, Jeremy Nunn, who has a Doctorate of Information Technology, says that common queries for chatbots include “questions related to payment, holiday leaves, social benefits and their [employees’] general rights.” Having a chatbot to answer simple questions alleviates the burden on HR departments. Nunn continues, “These bots can act as self-service platforms that allow the HR personnel to focus on responding to more complex and urgent questions that warrant their attention.”
In 2017, Multinational firm EY deployed a Watson-based cognitive chatbot named Goldie to enable more effective, digitally-driven HR support for its global employee base of 250,000 — with overwhelmingly favorable results. This is just one example of the far-reaching impact a chatbot solutions are already having.
Other potential uses for chatbots in the HR sphere include assistance with learning initiatives.
“Voice search and AI assistants like Alexa or Google [are] starting to be a core functionality within HCM,” says Matt Charney of Recruiting Daily. These voice-activated features will, like chatbots, answer employee questions and reduce the need for HR departments to respond to repetitive inquiries.
RPA has a wide range of applications. Deloitte suggests that more than half of HR processes are suitable for having robotics applied of them, as shown in the graphic below.
For those looking to implement RPA, Deloitte suggests that “RPA tools are best suited for processes with repeatable, predictable interactions with IT applications … [which] can improve the efficiency of these processes and the effectiveness of services without changing the underlining [sic] systems.”
2. Virtual and Augmented Reality
The term “virtual reality” probably brings some common images to mind: hard-core gamers, futuristic headsets, and science fiction creations like the Holodeck from the Star Trek series.
While it’s easy to assume that human resources is a world apart from the traditional virtual reality domain, the truth is that VR is one of the latest trends in HR technology.
Both VR and its cousin augmented reality (AR) are gaining traction as viable tools in the HR practitioner’s toolbox. They aid front-end processes like recruiting and onboarding, with numerous applications:
- Setting up a simulated environment that tests a candidate’s job-specific skills
- Sharing a virtual tour of your office space
- Using VR to bolster recruiting efforts
The British Army is using VR for recruiting. Convincing people to join the military is a hard sell. In order to boost Army Reserve recruitments, the organization put together four VR experiences, each based on common trainings, such as combat and tank training. During the first month that the experiences were posted on YouTube 360, the Army saw a 65% increase in applications.
Virtual and augmented reality also extend to training scenarios, either as part of the onboarding process or to provide current employees with additional training.
Benefits of virtual environments for corporate training include much higher cost efficiency and better safety for high-risk industries like construction. Partial or fully virtual environments can combine real-world tasks with virtual instruction. This allows employees to view learning prompts as they engage in hands-on activities.
Though VR and AR haven’t seen widespread adoption yet, the significant implications for recruiting and on-the-job learning make them one of the top HR technology trends to pay attention to over the next few years.
3. Employee Experience
Employee experience was the third most important key initiative among HR leaders in 2019, according to Gartner. It will remain top of mind through 2020 as companies seek ways to drive engagement and foster employee-centric cultures.
Focusing on the experience that employees have with the company, much as a brand focuses on the customer experience, can:
- Boost productivity
- Improve satisfaction
- Lead to greater employee loyalty
- Encourage investment in the company’s vision
A positive employee experience extends far beyond having a stocked kitchen and gym membership. In an interview with HR Technologist at UNLEASH Paris 2019, François Bornibus, the President of Lenovo, explained where companies need to focus their efforts:
“Put systems, tools, and processes in place that enhance, not limit, their [employees’] daily tasks and schedule but beyond the tools the most important is the value of the relationship and the respect to your people. Your employee is your first customer.”
Company culture plays a major role in creating a positive experience for employees, and Glassdoor expects culture to be a hallmark HR trend in 2020. In fact, a 2019 Glassdoor survey found that employees rate workplace culture as more important to job satisfaction than their salary.
The push for enhanced employee experiences has resulted in companies becoming the new brand and employees becoming the new consumer. This role shift will lead organizations to invest more thought and resources into branding and catering to employees’ needs. For example:
- Incorporating video content in recruiting efforts to drive more interest
- Using their employee value proposition (EVP) to differentiate from competitors
- Focusing on personalized experiences that acknowledge each individual’s unique workplace needs
4. HR Guidance
We asked Dave Ulrich, a professor, author, speaker and HR thought leader, for his thoughts on where HR is heading. One trend he believes will take hold in the coming years is the concept of HR guidance via Organization Guidance Systems (OGS).
“I see HR delivering value by offering more ‘guidance’ rather than simply scorecards, dashboards or predictive analytics,” he says.
Such a system, he explains in a LinkedIn blog post, provides value by “[clarifying] not only the desired outcomes of organization investments but the pathways to reach these outcomes and the precision adjustments required to make sustainable progress.”
In essence, an OGS identifies desired outcomes related to four spheres that are critical to business success: talent, organization, leadership and human resources. “An OGS,” Ulrich writes, “informs choices in each of these four paths to ensure that ideas have sustainable impact.”
This framework allows HR to move past simply offering descriptions and into the realm of providing solutions. “These solutions,” Ulrich says, “focus on how HR activities deliver key outcomes to customers, investors, communities, employees and businesses.”
5. Real-Time Performance Feedback
In today’s fast-paced world, the traditional performance review cycle is outdated. Thanks to tools like pulse surveys and real-time feedback channels, managers no longer need to schedule time-consuming meetings or evaluate performance only once a year.
With HRMS solutions, employees can receive regular, consistent feedback. Beyond the logistical benefits, real-time feedback “provides ample opportunity for managers to have meaningful and forward-looking conversations about personal and professional development with the employee, resulting in better engagement and improved productivity,” explains Sushman Biswas for HR Technologist. “It’s more constructive,” he writes “to engage in an open dialogue on employee contributions throughout the year.”
Feedback will also evolve to see “the increased use of VR for performance management, assessments and prescreening,” says Charney.
6. The New Way to Work
One of the most widespread HR trends taking place is the shift away from the traditional work model toward one that’s more flexible and worker-centric. This new framework consists of two main trends:
1. The Gig Economy
Employees are no longer merely 9-5 workers. Some have side hustles in addition to day jobs. Others, like freelancers and consultants, work for themselves 100% of the time. The faster that companies acknowledge this shift and align themselves with it, the more they stand to gain.
Millennials and Gen Zs are particularly open to working in the gig economy according to Deloitte data, mainly to earn extra income, gain more control over work hours and strike a healthy work/life balance.
This “alternative workforce,” as Deloitte terms it, can bring a lot to the table for organizations as well. Freelancers, for example, are often experts in their field, allowing companies to access top talent without the geographic limitations, costs and time of hiring another employee.
A recent Forbes article by Jon Younger suggests that the freelance movement has reached human resources as well. Many HR professionals are freelancing, providing consulting across a range of HR functions.
2. Remote Work
Another trend is the growing popularity and acceptance of remote work. Many companies offer flexible work from home days as a benefit. And some, like social media giant Buffer, run an entirely remote team.
Consider whether your company has policies in place that support remote workers. It’s not feasible for some positions and companies, but offering remote work options comes with many benefits, including higher productivity and increased employee satisfaction.
For more insight on the evolving workforce, check out our article “Talent Management Trends: The Intersection of People and Technology in 2020.”
7. Generational Shifts
Millennials and Gen Zs are entering the workforce while more baby boomers retire, causing disruption as companies seek to adjust to a new normal. The new generations have their own unique values and expectations when it comes to how their employers operate, the technology they use and the impact their jobs have. Understanding this new paradigm will help companies successfully navigate the shifting worker landscape.
Knowledge retention is another key aspect companies must consider. With so many workforce veterans phasing out of the workplace, it’s critical that companies have a process in place to capture this information to reduce potentially crippling skills gaps.
Evaluate your HR system to determine if you have the tools necessary to manage the ebb and flow of workers. This applies to knowledge retention as well as other business strategies such as talent development and succession planning.
8. Worktask Planning
Another trend Ulrich predicts is a shift away from the more traditional practice of workforce planning, into what he calls “worktask planning.”
The impetus behind this trend, according to Ulrich, is the transformation in how companies accomplish work. Compared to the workplace of previous decades, a wealth of options are available today:
- Full-time employees
- Part-time employees
- Contract workers
- AI (including machine learning and robots)
Because of this diversity, Ulrich says in a LinkedIn blog post, “The focus of talent management is less on planning a workforce than on accomplishing worktasks.” In other words, how the work gets done has taken precedence over who does it.
“Decomposing tasks and adding AI as a possible provider of the work changes workforce planning (people) to worktask planning (task accomplishment),” he says.
Ulrich believes this new model can affect nearly any industry — everything from hospitality to retail. However, he makes it clear that this shift away from workforce planning won’t ultimately lead to machines undermining humans: “This new approach to work does not discount people but relies on people for strategic, creative and unique tasks.”
9. Wearable Tech
The expectation is that wearable devices are going to be used, increasingly, to monitor workplace health. For high-pressure environments, this could have a big impact.
A study from 2018 by Dr. Candice Lanius of The University of Alabama in Huntsville (UAH) researched public speaking anxiety with the help of wearable biometric technology. Dr. Lanius recorded over 140 student speeches while simultaneously measuring their heart rate variability.
Based on the heart rate data in conjunction with the recordings, Dr. Lanius observed student stress levels in relation to their speeches. With this information, she worked to adjust curriculums to better prepare students to combat public speaking anxiety.
A similar approach can be implemented in workplaces. Wearable systems that track heart rate, body temperature, pupil dilation and other factors can provide insight into employee stressors or pain points, and management can change processes accordingly.
For instance, the ideal workplace wearable would be one that could identify the optimal time to send a notification. It would study the behavior and routines of the user in order to learn the difference between a good moment (setting up or preparing a task) and a bad moment (operating a machine).
10. Greater Integration Capabilities
Perhaps not as exciting as some of these other futuristic trends, integration still plays a key role.
And it’s possible via middleware, which Microsoft defines as “software that lies between an operating system and the applications running on it … enabling communication and data management for distributed applications.”
Why does integration matter? Because of the sheer number of HR applications in use.
“The average HR function uses 11 different systems just for recruiting,” explains Charney. “That means there’s no ability to do data warehousing, federated search or any meaningful analytics, as these don’t talk to each other.”
He continues, “With most major HCM providers already offering some sort of marketplace for vendors using custom APIs, we’re seeing an industry that’s tried to own all parts of the process finally start to collaborate with other technologies.”
As human resource management becomes increasingly automated, integration becomes an even more essential function. Your HR software should be able to easily connect with third-party systems to facilitate a more effective mix of capabilities. This includes other tools within the HR sphere, such as payroll software, as well as outside platforms like a business intelligence solution.
The Importance of High-Quality Software
Software is the nexus of many HR trends for the future. While technology advancements are an essential part of any business process, human resources is an area that benefits quickly and consistently.
The power to hand over responsibility for finding and processing huge data stores and then presenting the right information is a valuable asset that can save HR time and resources.
As your company grows in size and starts to take on more employees, your needs will become more sophisticated. Your HR software must reflect this in order to generate impactful ROI.
If you haven’t reviewed your existing HR solution for some time, now is a good opportunity to make sure that it’s still doing enough for your business. Just because a product was perfect five years ago doesn’t mean it’s still a good fit. Our requirements template can help you pinpoint which solutions are the best-suited based on your current needs.
Embrace the Future
Artificial intelligence, virtual reality, biometric monitoring and other HR technology trends are becoming less futuristic and more grounded in reality.
Alongside these tech innovations is an increased focus on the people aspect of HR — the experience an employee has with a company, better ways to conduct performance reviews and new work habits.
This tech and human blend forms a fascinating world ripe with potential for those willing to invest.
What do you think the key 2020 HR trends will be? Did we miss any? Share your insights in the comments!
Contributing Thought Leaders
Dave Ulrich is the Rensis Likert Professor of Business at the Ross School, University of Michigan and a partner at the RBL Group, a consulting firm focused on helping organizations and leaders deliver value. He has published over 200 articles and book chapters and over 30 books. He edited Human Resource Management 1990-1999 and served on the editorial board of four journals as well as the Board of Directors for Herman Miller (16 years). He’s spoken in 90 countries, performed workshops for over half of the Fortune 200, coached successful business leaders and is a Fellow in the National Academy of Human Resources.
Ben Eubanks is a human capital management industry analyst and influencer. His 10+ years of experience has included recruiting, benefits, training, employee relations, executive coaching and more. As an HR speaker and blogger, he covers topics related to strategy, leadership, culture and innovative practices among other things. He’s also written guides and developed courses to help HR pros be better at what they do. He co-founded the HRevolution movement, an event that has attracted hundreds of attendees from around the globe to work together and explore the future of HR, work and business.
Matt Charney is a marketing and communications professional who specializes in creating smart, compelling content and campaigns that transform brand marketing into real business results. He currently serves as the executive editor of Recruiting Daily and the chief content officer of Allegis Global Solutions.