Why HR Leadership in Concerned about digitization and digitalization

In the world of business, technology is making its presence felt strongly across all operational aspects. And given the importance of people to the success of business, HR leadership is also learning to work with technology in HR to better discharge their responsibilities.

What is digitization of HR?

An aspect of HR tech, digitization of HR is the typical first step of bringing technology into the erstwhile analog process of HR work. The aim is to optimize existing HR processes by converting physical assets into a digital format, not to bring about any dramatic changes or improvements in the same.

Common examples include converting employee records in paper form into a digital format suitable for use in a human resource information system (HRIS), or converting job applications and candidate resumes into digital form. In both cases, teams working under HR leadership would previously spend extended amounts of time on the same tasks.

How is digitalization of HR not the same?

Digitalization of HR is another aspect of the use of HR technology. However, it is more than just converting paper or other analog records to digital form, seeking to add not just convenience but value through the use of HR tech.

For instance, leadership in HR now handles several HR processes on the cloud through Google Workplace or other similar platforms. This allows for new forms of collaboration and several attendant advantages. A new hire to be onboarded could undergo an excellent onboarding experience facilitated by the coming together of company experts in compensation, compliance, and talent management through the use of HR technology.

What are the key differences between digitization and digitalization of HR?

The difference is essentially one of evolution vs revolution. Digitization looks to make incremental improvements in existing HR processes. Digitalization, on the other hand, takes this up several notches, by using technology in HR to not just improve a process but in fact change the very operational processes and operating models for the HR function. For example, employee records in digital format will still be tabulated and analyzed by humans, but with AI in recruitment or other examples of AI in HR, the process itself changes to bring in several attendant benefits.

The two are different but related closely. Digitization is part of the move toward digitalization, with the ultimate aim being digital transformation of HR through appropriate use of technology in HR. A properly planned process can help companies in long-term planning of strategies to optimize the deployment of HR technology and transform the HR function accordingly.

Why does digitalization need a dedicated, focused approach?

Understanding how digitalization is wider than digitization is crucial. A recent report from Gartner Research & Advisory unearthed the worry of two-thirds of business leaders regarding how their competitive abilities would suffer if they did not step up their digitalization efforts. With 88 percent of CHROs planning investments in HR tech in 2020-2022, this difference becomes ever more important. The significant considerations in this regard are as below:

• Create more accurate HR key performance indicators (KPIs): Comprehending the distinction required between the two is imperative to be able to measure progress. A simplistic measure, for instance, could be hours saved through digital processes, but a more value-adding measure for leadership in HR would be how much the quality of hires has improved or how convenient the latter found the experience.

• Plan tech investments better: Scanning paper records is good, but implementing AI in HR could be even better. For instance, candidates could fill in online applications and AI in recruitment could analyze those details, matching them with other information sources for a more informed consideration.

• Properly sequence digital transformation: The best results come only when the process is right. Digitized records could be put on the cloud, HR professionals could work on these collaboratively and in real time, and analytics could enable data-driven selection of candidates.

The most important thing to remember is that digitalization must be linked to business goals, and must facilitate their attainment.