10 trends HR professionals need to watch in 2020 (Part 1)

It seems like only yesterday that we were seeing articles predicting what HR would be like in the far-off future of 2020.

Flash forward and the new decade is finally upon us – and those who predicted that HR would play a more strategic role in business than ever before have certainly been proven correct.

So, what should be the key issues on the minds of HR professionals as we dive into the roaring 2020s?

Here are our picks for the 10 trends you need to watch this year.

1 – Personalisation

Personalisation has been a major watch word in the world of marketing, sales and customer experience for many years now, and we’re now seeing it pop up on the radar of HR teams around the world.

The logic for stronger personalisation in HR is more or less the same as it is in marketing or sales. Your employees are the “customers of the workforce”, and by providing them with a personalised experience you boost engagement and create positive interactions that are of mutual benefit to the individual and the business. For individuals it means a stronger sense of culture and recognition, while for businesses it means better productivity and retention.

Personalisation in HR is an exciting trend because of the number of potential applications. These include personalising benefits and rewards, employee onboarding, learning and development, and internal communications. All of this is underpinned by another important trend highlighted later on in this blog – how HR teams can make use of data analytics to better understand their workforces.

2 – Financial education

Financial wellbeing will continue to be an important issue for HR teams this year. As businesses search for practical and valuable ways to help alleviate employees of their money worries, we may see more turn towards offering financial education programmes as part of their benefits packages.

According to our recent research, less than half (44%) of UK businesses currently offer them. This is despite the fact that over half (58%) of employees don’t fully understand their payslips, while significant numbers also said the same about their benefits packages (40%) and pension options (25%). However, the majority (63%) of employees said that these programmes would make them feel their employer cared more about staff wellbeing, while just under a third (31%) said they would feel less stressed about money issues.

Pay is already the central transaction between an employer and its employee, but this year it may be time for businesses to consider how they can go the extra mile to boost financial literacy. The result could well be less stress and more productivity in their workplaces.

3 – Automation and AI

For the majority of today’s HR professionals, automation and artificial intelligence (AI) are no longer unfamiliar terms. But while they may not be considered ‘new’ trends in 2020, the rate at which organisations continue to overhaul their traditional HR processes in favour of new technology is worth keeping an eye on.

A growing proportion of HR departments are now using software to automate key processes such as records management, candidate screening, onboarding, payroll calculations, performance reviews, and much more. The world’s leading organisations are now taking a step beyond using automation for repetitive, routine processes, towards using AI for much more complex and data-driven tasks. According to a report from management consultancy Bain, more than three quarters (78%) of HR departments expect to use machine learning in at least one process within two years.

The challenge for HR teams will be balancing insights from intelligent machines with human intuition, experience and judgement, so that AI becomes an enabler – and not a replacement – for the workforce.

4 – Pay equity

Pay equity is likely to make the headlines again in 2020, especially with large UK-listed organisations set to publish their first executive pay gap reports this year as mandated by new legislation.

The new legislation, which requires these organisations to disclose how the salary of their top executive compares to employees in the rest of the business, is the latest initiative designed to improve pay transparency after the introduction of gender pay gap reporting in 2016. However, with Paygaps.co.uk finding that a third of gender pay gap reports for 2018 contained errors, it’s clear that not all organisations are fully prepared to fulfil their obligations.

With the addition of executive pay gap reporting this year – and the prospect of ethnicity pay gap reporting potentially on the horizon – businesses could easily get caught out without the right compliance measures in place.

5 – People analytics

Now that HR is firmly seated at the boardroom table, it’s becoming more important for the department to explain its impact on the business through the numbers. Especially as functions such as marketing – not traditionally seen as data-driven – can now quantify its impact through advanced analytics. Our research found that 77% of CEOs would like to see more HR data, 69% want improvements in the timeliness of this information, and 63% want a greater level of accuracy.

HR teams are increasingly using surveys as a relatively quick and easy way to gather insights on the employee experience and better understand areas for business improvement. Beyond this, more organisations are realising the potential to integrate core HR data with what is arguably the single biggest and more consistent source of valuable workforce insights – the payroll.

Many HR teams overlook payroll data when in fact, it can help answer critical questions such as “How do pay and benefits affect employee performance?”, “In which areas of the business are the most overtime hours worked?”, and much more. Expect 2020 to be the year when many organisations increase the depth and sophistication of their people analytics.

Like what we’re thinking?
Look out for **[Part 2 of ’10 trends HR professionals need to watch in 2020’](https://www.zellis.com/blog/10-trends-hr-professionals-need-to-watch-in-2020-part1/)**