Organizations lack a business case for HR initiatives | KPMG | NZ

More than half of organizations lack a business case for HR initiatives: KPMG International

Organizations lack a business case for HR initiatives

While a growing number of companies are embracing the need to transform their HR functions, a troubling number remain stalled.

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While a growing number of companies are embracing the need to transform their HR functions to adapt in a disruptive business environment, a troubling percentage of organizations remain stalled, with more than half (59 percent) saying they do not even have a basic business case in place for HR initiatives. This is just one of the findings from the 2017 KPMG HR Transformation Survey of nearly 900 executives from 48 countries.

“These findings reveal a clear distinction between the organizations that `get it' and those that don't,” says Robert Bolton, Partner, Global People and Change Center of Excellence, KPMG in the UK. “While the leading organizations are proactively driving HR transformation to redefine their workforces in the digital age, far too many HR leadership teams are sitting on the sidelines, seemingly uncertain as to the strategic value that the HR function should be bringing, given the uncertainty associated with planning the workforce of the future for the digital age. To us, the message is clear: implement a holistic change of HR to enable the organization to shape the workforce of the future or risk obsolescence.”

While a quarter of respondents (27 percent) say they view HR as a key business asset that can add strategic value to their organizations, many say they are experiencing significant challenges when it comes to delivering that value. Forty-three percent cited shortcomings in supporting HR technologies as being a key roadblock, while 36 percent cited inadequate change management capabilities.

And while more organizations have bought into the need to gather vast amounts of data, many say they are experiencing challenges making that data actionable. The survey reveals that data acumen is a key shortcoming for many organizations.

“For an organization to successfully operate in the digital age, they must be able to harvest, interpret and act on the insights data can deliver - this is the goal of digital transformation,” says Michael DiClaudio, Principal, Advisory, KPMG in the US.

When it comes to areas of investment, the leading organizations say their top areas of focus for 2017 are talent management and HR data and analytics capabilities. The survey results also show that more than a third of (38 percent) responding organizations expect to increase their HR technology spending in 2017.

These findings come on the heels of the KPMG 2017 Global CEO Outlook Survey, which shows that CEOs are actively pursuing and implementing disruptive technology to unleash new competitive advantages. With continued pressure to deliver, these CEOs are focused on managing their core business strengths while transforming how they create and maximize value. Sixty-five percent of CEOs say they view disruption as an opportunity rather than a threat. At the same time, about half of CEOs said they're anticipating a major disruption in their sector in the next three years.

Download the executive summary of the 2017 KPMG HR Transformation Survey. For more information, go to KPMG Anticipate. You can also follow the conversation @KPMG on Twitter using the hashtag #HRsurvey.

About this survey

During February to April of 2017, 887 executives from 48 countries participated in the HR Transformation Survey, with representation from 27 industries across Asia Pacific, Europe, North America, Middle East/Africa and Latin America.

About KPMG International

KPMG is a global network of professional services firms providing Audit, Tax and Advisory services. We operate in 152 countries and have 189,000 people working in member firms around the world. The independent member firms of the KPMG network are affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. Each KPMG firm is a legally distinct and separate entity and describes itself as such.

© 2017 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved.

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