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Sankar Radhakrishnan

Thiruvananthapuram , Dec. 8

IN many organisations, the human resource (HR) department is increasingly expected to become a strategic partner by delivering value and driving the change process. But how willing is the HR department to reinvent itself and what is its role in a changing environment?

These questions were at the core of a recent study on `HR transformation' in Asia conducted by Mercer Human Resources Consulting. Part of a series of studies on HR transformation — the reinvention of the HR function — across the world, the Asia study sought insights from senior HR executives in over 300 organisations in 11 Asian nations, including India.

Interestingly, the study found that 84 per cent of the participants are either currently involved in or planning activities to transform their HR function. However, equally interesting is that only 8 per cent of the Asian organisations surveyed have already completed the HR transformation process.

Some 76 per cent of the executives polled said the decision to change the role of the HR function was driven by the need to align HR with corporate objectives, while 70 per cent said it was driven by the need to make HR a strategic function. At the all-Asia level, only 26 per cent of the study's participants cited cost reduction as a reason for transforming HR.

For HR practitioners in India, the study has some reassuring insights to offer. While 71 per cent of the respondents said their companies were in the midst of a HR transformation exercise, 11 per cent stated they had already completed the transformation process. A point to note is that the drivers of the HR transformation exercise in India differed rather sharply from the rest of Asia. The belief that HR is not adding sufficient value and the desire to reduce the cost of HR were the primary drivers of the HR transformation process in the country, the study found.

The study also looked at how HR professionals assess themselves based on current performance of the four roles within the HR function — employee champions, strategic partners, administrative experts and change agents. While respondents from India assessed themselves quite favourably on the performance of all roles, the all-Asia response on this front was more conservative.

Outsourcing of HR services, both current and planned, is an area in which India has turned in mixed results. On payroll outsourcing, India is ahead of all the other Asian nations surveyed. According to the Indian participants, 25 per cent of payroll activity is outsourced at present and this is expected to rise to 43 per cent in the future.

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