“For today’s employees, interacting with HR should be as easy as ordering a pizza on your smartphone”. So says David Mallon, head of research at Bersin by Deloitte. The human capital specialist was in Australia last week and spoke to over 600 HR professionals, with about 50% of attendees coming from the public sector. David’s aim was to contextualise the findings of Deloitte’s Human Capital Trends 2017 survey for his audience. His message was consistent. This is an exciting and crucial time for HR to step forward, as organisations and work become more ‘human centred’. However, it can only be exciting if HR professionals have a change of mindset. More than that, he suggested that HR professionals need to ‘Innovate HR’. Our priority, he says, must be for HR become a force to encourage the business to spur on rather than hold the business back. To do this, understanding the growing gaps between these four factors driving human capital change—technology, individuals, businesses, and public policy—is essential. The drop off in productivity, as it relates to the rate of development and adoption of technology, has been concerning for a while now. David’s take on the productivity gap is that appearances can be deceiving. More detail on this graph and the trend it illustrates can be found at this blog. While time cycles for new tech are getting faster, individuals can usually keep up and embed and drive value pretty quickly. Organisations are always slower than the individuals working in them, and public policy is slowest of all to adapt. He placed HR somewhere above public policy, but behind organisations. Our priority, he says, must be to move ahead of our organisations in adapting to developments. HR should be positioned to lead our organisations and pull them forward, rather than drag them back, which is where we are now. How can HR become a force to spur the business on? Using David’s advice and the research from Human Capital Trends, we’ve come up with five mindsets that a proactive HR must adopt. The mindsets needed to ‘Innovate HR’: A digital mindset – digital led. Create a digital ready workforce, a digital workplace, and become digital HR. We tend to see a lag in the intensity of the issues and trends in the public sector compared to, for example, financial services. We are seeing the take up of digital HR applications faster in financial services, while many public sector agencies are still focused on core technology. However, there is an opportunity for the public sector to learn from mistakes of business organisations on digital adoption and to leap-frog some experiences by taking a human-centred design approach to projects. A design thinking mindset – people first. Design thinking is problem solving with a designers mindset – approaching a problem from the point of view of people rather than a system. It’s not a new concept to the public sector, who have used it widely to redesign public services. The challenge for public sector HR professionals is how to embed the thinking used for external outcomes and customer experience to improve processes, outcomes and employee experience within the organisation. In taking this approach, HR shouldn’t start from the top, but build from the bottom. Think about designing experiences, rather than solutions or programs. A good tip is to take the customer maps you already have and apply them for employee experience. A data led mindset – but with the story to match. There has never been more data available to us. The amount of data collected in the last two years is nine times greater than previously collected in all of humanity. But if we can prevent ourselves from being overwhelmed by this tsunami of data, then we realise that the opportunity is there to know our clients and employees in ways that were never possible before. Use data to understand your workforce, and to build support for new approaches that you test across the organisation. In addition to using the data to inform decisions, HR need to develop their storytelling skills. Data is useful only insofar as you can engage the business in the stories that the data tells about their workforce patterns. Effective use of data and good storytelling around this data can be really effective in dispelling myths that have perpetuated in the organisation over time. An agile mindset – start small, iterate, cut what’s not working. There is quite a long way to go between where HR are and where they need to be. Sometimes it can be more helpful to look at what the small changes are that you can make before taking big leaps. ‘Never let the perfect be the enemy of the good’ – in other words – iterate. Roll out a program that is 70-80% finished and use the feedback and data you get to refine it. Start with small projects that relieve a burden or change the engagement experience, but that could build over time – e.g. an Australian bank that first built an app to automate the process of granting employee verification letters. This was such a success that they could then build a case to do more and more in this way. Functions don’t have to be completely redesigned – this can be done through iteration. As employee needs and the nature of work changes as well as the demands of organisations, HR needs to re-evaluate the type of services they deliver and how they deliver them, Are they continuing to meet the needs of both employees and the organisation? Take learning and development and performance management as examples. Both unwieldy functions in their traditional models, new approaches are needed to meet the needs of workforces of the future. A learning mindset – building capability in HR We all learn from doing. Getting diverse experience and working in a variety of environments is one of the quickest way to build capability. A challenge for the public sector is that the majority of HR professionals working in the sector have had limited experience or exposure to working in other industries. So they need to look at other ways to build their capabilities and expand their knowledge. Some of the ways to do this could include: Commit to devoting time and budget to acquiring the new skills that an innovation HR function will need. Set aside budget for prototyping new projects and new approaches – we learn most quickly by doing. Get more comfortable with ambiguity; making principle-based decisions and taking risks. I realise this is more difficult to do in a public sector environment, but embracing ‘good risk’ is crucial for genuine transformation. HR needs to shed their role as rule makers and enforcers and embrace the role of innovators and innovation facilitators. Establish a platform of capability; like Facebook or LinkedIn have become platforms for connecting people, HR has the opportunity to become a platform for improving the employee experience. These suggestions for hacking the HR mindset are just a start. For the public sector, fundamentally changing how they deliver HR can seem like a daunting task, considering existing budget, capacity and capability limitations. But every journey of 1000 miles starts with a single step. And so it is with change – small steps, applied consistently, can add up to big impacts. For more detail on this topic and many related subjects, and access to research see: 2017 Deloitte Human Capital Trends and Bersin by Deloitte.