HR is increasingly crucial to business strategy, says PwC report

Author: Kirsty Tuxford | Date: 19 Oct 2016

New trend in Middle East sees HR teams becoming the heart of many organisations

HR is showing signs of moving from an administrative support role to a far more strategic one, according to a newly released survey of HR leaders in the region’s largest organisations.
 
The survey, conducted by PwC, revealed that 77 per cent of respondents said their board was committed or strongly committed to their HR strategy. Furthermore, 54 per cent agreed and 15 per cent strongly agreed that HR is aligned to the overall business strategy of the firm.
 
Omantel is an example of a new trend in the Middle East of HR becoming the heart of the business. Its plan for HR between 2016 and 2018 is not only aligned to the organisation’s overall business ‘3.0’ strategy, but is a key pillar of it. “The HR department was the first department to have a plan that was aligned to the company’s strategy,” said VP of HR, Dr Ghalib Saif Al Hosni. “Our HR strategy is not something that we write and just say ‘oh we have a strategy now’; it’s something we have to live and believe in.”
 
This change in the role of HR can be seen across many sectors. Adrian Hallek-Jones, regional HR director, south Asia, Middle East & Africa, at communications consultancy Edelman, said: “We recognise that our people are our biggest assets and that every move our business makes directly affects them. A true HR business partnership offers any organisation analysis of data, trends and cost, which impacts revenue and is therefore pivotal to organisational success. Strategic alignment of our business and people strategy is not just important, it’s critical.”
 
The PwC report’s authors do express concern over the 30 per cent of respondents who do not believe their HR strategy is aligned with their corporate goals. This figure suggests that some businesses are lagging behind when it comes to making HR a driving force.
 
David Suarez, partner and people & organisation leader at PwC Middle East, said: “We are trying to educate many of our clients that human capital management is not only the responsibility of HR – HR is a catalyst and an enabler, but at the end of the day the responsibility for attracting, nurturing and retaining that talent needs to lie with the business. Line managers need to have ownership of that. I’ve seen, much too often, line managers throwing it over the fence and saying ‘let HR deal with it’.
 
“There are positive signs – the HR function is evolving, and becoming more professionalised,” said Suarez. “There is recognition that you cannot have just anyone running HR, and that specialised talent is needed.”
 
Analysts at PwC outline fives areas where there is room for improvement in terms of making HR functions more strategic, effective and closely aligned with the corporate goals: focus on leadership and talent; invest in the future; create a culture where innovation thrives; make more use of HR analytics; and tailor HR practices to what the business needs.
 
“Typically, organisations are using a suite of options to maximise their access to increasingly hard-to-find talent, from ‘gig economy’ workers to full time employees,” said Suarez. “Getting these structures and relationships right is a complicated issue and one that organisations need to address rapidly.”