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CENTER OF EXCELLENCE

2018 REPORT · THE FUTURE OF HR


HR TRENDCAST
Paycor asked HR pros and C-suite execs in small and mid-sized
organizations to talk about the present and future of HR.
We asked HR pros and C-suite execs in small and mid-sized organizations to talk about
the present and future of HR.
Here’s
Here’swhat theysaid.said.
what they
About this Report
The HR Center of Excellence 2018 report
was conducted by Harris Poll on behalf of
Paycor from August 10-20, 2017. (For the full
methodology, please see explanation at the
end of this report.)

Who We Talked to
More than 500 C-suite executives and HR
managers/directors in the United States
completed the survey, and all respondents
have primary or significant involvement in
HR-related functions at their organization.
What’s Inside

WHAT’S INSIDE
1 Gut Check:
How We Feel Today
HR leaders feel optimistic about the
direction of their business in 2018 and
employee morale is high, but two big
challenges—finding the right people and
keeping them motivated—will keep HR
busy.

2 How We’re Preparing


for the Future
HR is gradually becoming less about
administrative tasks and more about adding
strategic value. Organizations are doubling
down on data and creating people-centric
models of recruitment and retention. Is your
company following suit?

3 What HR Will Look Like


in 2022
Technology and automation will disrupt
the status quo in ways big and small. As
core HR functions get automated, HR
is primed to showcase their soft skills
and become the talent strategists and
retention experts who build and nurture
company culture and positively impact
employees’ lives.
GUT CHECK: HOW WE FEEL TODAY
HR leaders are most concerned about

45%
finding and keeping talent.

Takeaway: With unemployment rates at record lows, of HR leaders worry about


recruiting & retention
organizations are in fierce competition to land top talent. That’s
why we’ve heard a lot of discussion in 2017 around building an
“employment brand” that attracts the right kind of people to
your company. In 2018 and beyond, we’ll also be thinking a lot
about retention. The average worker
will change jobs no less than 12 times ORGANIZATIONS
throughout their career, which puts ARE IN FIERCE
pressure on HR to not only find, but
also to engage and develop talent. COMPETITION TO
In the next five years, HR leaders will
evangelize a holistic approach to the
LAND TOP TALENT.
entire employee lifecycle from the
early stages of attraction and onboarding through career
development, learning, and training.
GUT CHECK: HOW WE FEEL TODAY
What else does HR worry about? Takeaway: What do these challenges have in common?
They’re all about PEOPLE. The trend is clear: as core HR tasks
#1 Recruiting & Retention 45% become automated (more on that later), HR can turn their
#2 Developing Talent 30% attention to engaging and developing people. Rigid, legacy
#3 Managing the Skills Gap 28% HR systems and manual processes will no longer prevent HR
#4 Managing Workplace Conflict 28% from cultivating relationships,
#5 Managing the Multi-generational Workforce 26% and HR’s desired focus will come THE TREND IS CLEAR:
to life: making a difference in
AS CORE HR TASKS BECOME
the lives of their employees.
AUTOMATED, HR CAN
TURN THEIR ATTENTION
TO ENGAGING AND
DEVELOPING PEOPLE.
GUT CHECK: HOW WE FEEL TODAY
Most believe compliance will Takeaway: The only certainties in life remain the
continue to be an issue. same: death and taxes. Perhaps we can safely add
“compliance” to that list. Employers
Does the current administration change the way are still wary of compliance, but TO STAY ON TOP
you feel about compliance? many HR leaders say that the
only way to reduce that anxiety OF UPDATES,
is to take a proactive approach to
CHANGES, AND
20% compliance management. To stay
on top of updates, changes, and NEW REGULATIONS,
LESS new regulations, you need to find
CONCERNED
a partner that has an expertise
YOU NEED TO FIND
in compliance. While we can’t A PARTNER THAT
predict the future of compliance,
37% 43% we can feel confident in our ability HAS AN EXPERTISE
to manage change by taking the
MORE NO IN COMPLIANCE.
CONCERNED CHANGE necessary steps to prepare.
HOW WE’RE PREPARING FOR THE FUTURE
What are you investing in now and what will
The next 5 years will see heavy you be investing in 5 years from now?
investment in people and data.
RECRUITING
34%
40%

Takeaway: Why is HR planning to double-down PERFORMANCE MANAGEMENT


on compensation and performance management?
Because while everyone talks about finding top 28%
talent, HR understands that it’s equally important to 36%
develop and retain talent. This dynamic is exacerbated
by millennials who tend to
HR LEADERS ARE job hop until they find the COMPENSATION MANAGEMENT
perfect fit. So, what’s the 20%
MIRED IN A blueprint for success? Look 29%
for HR teams to invest in
BATTLE TO RETAIN
learning and performance
THEIR BEST PEOPLE. management software to
DATA ANALYTICS
improve training throughout 26%
the organization.
31%

today
5 years
HOW WE’RE PREPARING FOR THE FUTURE
HR leaders in the SMB world will use
“small data” to help solve big challenges. KEY PERFORMANCE INDICATORS
HR leaders will look to improve the recruiting and
hiring process by monitoring key performance
indicators (KPIs), such as:
Takeaway: HR leaders in the SMB space are not going to
invest in “big data” like their enterprise counterparts at companies
TIME TO HIRE
like Google and Amazon, but in the next five years, look for
them to become much more focused on “small data.” Small
data is information that can be
immediately interpreted and put to SMALL DATA IS OFFER ACCEPTANCE RATE
use by a human without extensive
INFORMATION THAT
processing. It is informative, easily
accessible, and provides practical CAN BE IMMEDIATELY COST PER HIRE
insights that drive business decisions.
For example, monitoring employee INTERPRETED AND PUT
turnover enables you to spot TO USE BY A HUMAN. RETENTION RATE
important trends, understand the
root causes of turnover, and then do something about it, such
as refining your training, development and performance review
processes. Employee turnover data can also identify which of your TURNOVER RATE
locations or departments face the most attrition risk.
HOW WE’RE PREPARING FOR THE FUTURE
The annual performance review is Today BY 2022

an endangered species.
51% 38%
do annual will conduct
reviews performance reviews
Takeaway: Employees don’t stick with a single more frequently
company from hire to retire. Job hopping is the new
norm. And if employees don’t get frequent opportunities
to learn and grow, and if they don’t get timely feedback,
chances are they’ll hop sooner
rather than later. This tendency, LOOK FOR MORE
along with the tedious and
FREQUENT AND
time-consuming paperwork of
the traditional “annual review,” LESS FORMAL
is forcing many employers to
revamp the review process. In the FEEDBACK
next five years, look for the trend SESSIONS TO GAIN
toward more frequent and less
formal feedback sessions to gain MORE MOMENTUM.
even more momentum.
HOW WE’RE PREPARING FOR THE FUTURE
HR as we know it is coming to an end…
48%
believe many core
HR functions will be
automated by 2022

Takeaway: How much time do you spend answering the


same questions from employees? How many hours do you spend
on payroll runs? On shepherding the team through benefits
enrollment? On PTO requests?
On spreadsheets and paper TRADITIONAL HR
filing? Most people get into HR
TECH WAS BUILT TO
to make a difference, but many
get stuck in administration DO ONE THING:
instead. Why? Because in the ENSURE COMPLIANCE.
past, HR technology wasn’t
built to make HR’s job easier or to give HR time back to focus
on people. Traditional HR tech was built to do one thing: ensure
compliance; it was essentially a legal reporting tool, built with the
government in mind, not the HR user. All that is changing, fast.

today
WHAT HR WILL LOOK LIKE IN 2022
82%
say “soft” skills will become
more important as HR
…and that’s a good thing.

becomes less administrative

Takeaway: Today, the right

47%
TODAY, THE RIGHT
HR technology partner can
automate the administrative HR TECHNOLOGY
work that has kept HR in a
box. It’s true that many HR CAN AUTOMATE
departments are still held ADMINISTRATIVE
hostage by rigid legacy

future
expect their jobs to
become more “big systems, but don’t expect that WORK.
picture” and strategic to last. In the next five years,
look for HR teams in the SMB world to use technology to do
two things: automate routine, repetitive tasks and augment
their ability to forecast and plan with data-driven decision-
making tools. “Automation” might sound scary, but it’s actually
the door HR will walk through to get to a new place in their
organization, a wide-open place that gives them the breathing
room they need to coach and develop, retain and grow their
company’s greatest asset, their people.
WHAT HR WILL LOOK LIKE IN 2022
And finally, by 2022, HR pros
predict their teams will be focused
on 3 top priorities:
Training & development, employee retention,
employee morale

TOP 3 PRIORITIES
Takeaway: In the next five years, HR, with its’ #1
diverse mix of skill sets and unique perspective on Training & development 49%
business operations, is positioned to add strategic
value to the C-suite on critical issues ranging from
recruiting and onboarding to talent development #2
and retention. Our survey indicates that HR leaders Employee Retention 42%
are gearing up for the challenge, with most reporting
that their department will increasingly become more #3
strategic, more data-driven, and critically focused on
Employee Morale 41%
people development. Which is
all just another way of saying HR IS POSITIONED
that there’s never been a
better time to be in HR. There’s TO ADD STRATEGIC
never been a better time to
VALUE TO THE C-SUITE.
make a difference.
WHAT HR WILL LOOK LIKE IN 2022
We hope you’ve enjoyed this report
and found it informative.

If so, you’re probably looking forward to the future (you


should be!) and eager to take next steps. To help you
sustain that momentum, we’ve created the HR Center
of Excellence, a program designed to help your HR team
keep improving and growing in five key competencies:
recruiting, labor costs and benefits, compliance, people
management, and employee evangelism.
SURVEY METHODOLOGY
THE HR CENTER OF EXCELLENCE 2018 REPORT METHODOLOGY
The HR Center of Excellence 2018 Report survey was conducted All sample surveys and polls, whether or not they use probability These are only theoretical because no published polls come close
online within the United States by Harris Poll on behalf of Paycor sampling, are subject to multiple sources of error which are most to this ideal. Respondents for this survey were selected from among
between August 10, 2017 and August 20, 2107 among 503 adults often not possible to quantify or estimate, including sampling error, those who have agreed to participate in Harris Poll surveys. Because
ages 18+ who are employed full-time as a C-suite executive or HR coverage error, error associated with nonresponse, error associated the sample is based on those who agreed to participate in the
manager/director at a company with 2-999 employees that has with question wording and response options. Therefore, Harris Harris Poll panel, no estimates of theoretical sampling error can
annual revenue of $50,000 or more. All respondents have primary or Poll avoids the words “margin of error” as they are misleading. All be calculated.
significant involvement in HR-related functions at their organization. that can be calculated are different possible sampling errors with
Data were not weighted and are only representative of those who different probabilities for pure, unweighted, random samples with
completed the survey. 100% response rates.
HOW WE CAN HELP
How We Can Help
If you’re an HR leader in a small or mid-sized organization, chances
are you’re either quietly leading the charge on a number of
initiatives that are positively impacting the bottom line or you’re
fighting an uphill battle with administrative and even paper-based
processes that prevent you from making an impact.

In either case, finding a trusted partner is one of the most


important things you can do to prepare for the future.

Paycor elevates your HR team and extends your reach. Our platform
modernizes every aspect of people management from the way you
interact with candidates, onboard new hires and retain top talent,
to the way you pay them and build a company culture.

To see how Paycor provides the tools you need to make a


difference at your organization, take a tour of our platform and find
the solutions that best fit your needs.

visit us at
resources.paycor.com