Say goodbye to the practice of HR as you've known it. Big changes are coming to the way organizations hire, manage, and reward employees.
1. Workforce analytics = People data
Quick: What do the Oakland A's and Google have in common?
Sure, they're both based in the Bay Area of California. Both are staffed by vigorously active and healthy-looking workers. And both organizations are industry standouts. (Google is almost an industry by itself. The A's have won nine World Series titles, four since the franchise has been in Oakland.)
But the most interesting characteristic they share is how they use data to achieve competitive advantages. Both employ sophisticated data analysis tools to make decisions that move their organizations forward, including staffing decisions.
During Oakland's 2002 season, team manager Billy Beane famously adopted a strategy of making roster decisions based on batting averages, RBIs, and a multitude of other stats, rather than the guesses and gut instinct of scouts.
The result? The team finished first in the American League West that season. Beane's management style took only a few weeks to transform from old school gut-check calls to the data-intensive style recounted in Michael Lewis's bestseller Moneyball and the Brad Pitt film of the same name.
Google, of course, has always been in the numbers business. Some of its massive data projects include the workplace. With Project Oxygen, Google hopes to make better bosses by analyzing data about managers. The company is also delving into workforce data to understand the effectiveness of its own HR strategies and practices.
Can your healthcare organization head down the same path?
2. HR Will Get Out of the Benefits Business, Part I
HR strategists, who are keenly aware of what's happening in the health insurance marketplaces, see the beginnings of a major market upheaval. While employers have been shifting healthcare costs onto workers for years, the real game-changer is on the near horizon: Employers will one not-too-distant-day stop offering commercial health plan policies as part of their benefits packages. Instead they'll provide employees with a financial incentive to use a health insurance exchange to select coverage, much as 401(k) plans have replaced company-sponsored pension plans.
The reason is simple, as explained by MarketPlace Money: it's money. "… [S]ome employers who have tried this have offered employees anywhere from $2,500–$3,000 per year to shop with on private health exchanges. That amounts to less than they'd have to pay for insuring workers under traditional company plans on average."
This will be a huge shift for both employees and employers, who might not need to retain as many benefits administrators as they currently have on the payroll. If that gets you steamed, check out the lively discussion on LinkedIn last week in reaction to a provocative post, Why We No Longer Need HR Departments.
3. HR Will Get Out of the Benefits Business, Part II
Speaking of lightening the load of benefits managers, here's another thought. We know that wellness programs often don't work well. Instead of trying to improve them, a better idea might be: Don't do a thing.
The accelerating interest in population health programs as a way to cut healthcare costs signals that there's a bigger, better-funded push behind getting your employees to lose weight and take their meds—and it's more powerful than anything your HR department can do on its own.
Re-examine your budget and your people strategy. Some of what you can safely stop spending on nutrition lectures and smoking cessation class vouchers will be much better spent on analyzing the data that's pertinent to your hospital or health system's staffing strategy.