Human Capital Dilemmas: Asia's Next-Level Advantage

Human Capital Dilemmas: Asia's Next-Level Advantage

by
Vijayan Munusamy & Michael Jenkins

Senior Researcher & Chief Executive Officer, HCLI

Organisations need to contend with a multiplicity of human capital realities. Some of these realities include frequently cited human capital challenges such as employee engagement and megatrends, such as demographic change. But these are not the only realities.

Realities include the present-day state of things taken for granted, ignored or even unnoticed, but they systemically impact and shape human capital practices. In this article, we share one of those four realities: Human Capital Dilemmas.

If one profession has to deal with role conflict continuously - it is HR. It is paradoxical that while HR not only resolves role conflict amongst employees and is frequently called in to get a handle on workplace friction, HR professionals themselves face role conflicts regularly and often find themselves left facing a conundrum (more about this later). If some argue that we live in the age of dilemma, it is the HR profession that has first-hand experience of this.[1] There are countless examples of HR dilemmas throughout the evolution of the HR profession, but one thing is certain: HR leaders have to “walk” a fine line between ‘human’ expectations and ‘capital’ goals. 

So, setting aside the fact that while many predictions about “Future HR” made in the past have failed to materialise, we feel this "walking" aspect is inevitable, inescapable and it is here to stay. It is also reasonable to predict that this "walking" will not only keep increasing in terms of frequency but also in terms of its complexity, speed and intensity. A recent finding from the Chartered Institute of Personnel and Development (CIPD) below puts this in context:

“People professionals in Malaysia (44%) and Hong Kong (45%) were the most likely of the APAC countries to feel that there’s a conflict between what their organisation expects them to do and what they feel is appropriate according to their professional judgement”[2]

Our synthesis shows three drivers will perpetuate the inevitability of Human Capital dilemmas.

First, as the business world experiences exponential changes in many areas, HR leaders will be forced to re-evaluate their ways of adding value to the business. There will be many types of new support needed, such as “workforce upskilling” to cope with business changes. However, HR leaders will be still expected to fulfil their traditional "bread and butter" role. These new and old demands may compete for the same resources, and as the managerial bias and organisational inertia help to perpetuate the "status quo", these dilemmas remain unsolved. 

Second, as digitization and automation in human capital management systems become mainstream, HR professionals will be expected to support businesses at a much higher speed and to be highly responsive – all without losing the human touch. But as we know, algorithms work well for routine, logical and straightforward decision-making, but are rather less well-suited to handling dilemmas that require human intuition or sensitivity. HR tech can provide much-needed speed and greater efficiency for organisations, but it is not there yet when it comes to replacing the human touch.

Third, no matter what HR does, no matter how strategically and deftly HR professionals handle human capital dilemmas, the erstwhile and ongoing narrative of “HR needs to be strategic, HR needs to do more, and HR needs a seat at the table” will continue to be ingrained in debates between HR and business leaders.

And as organisations face more disruptive and complex business challenges, these narratives will only increase in frequency and intensity. It’s a hard fact, but it means HR leaders will need to respond by execution rather than purely “reacting.” How? We will share what we have learnt later in this series of articles. Meanwhile, in the graphic which follows, we share some often-mentioned dilemmas.

Reality: Inevitable HR Dilemmas

 

[1] Umair Haque (2011) 'Welcome to the Age of Dilemma', Harvard Business Review. 10 Feb.

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