The human resources walled city

HR/HCM is historically the mature 'social' center of businesses and can either lead digital transformation or be subsumed into a supporting collaborative role
Written by Oliver Marks, Contributor

We live in interesting times. Arguably for the first time in history always-on free personal digital tools that facilitate our social interactions and connections are flooding the planet, funded by the commercial prize of analyzing and profiting from the oceans of data we reveal about ourselves and from being marketed to with ever greater targeting. (The personal devices and data plans that run these tools are expensive, but that's for another post).

The image above is of Kowloon Walled City, which until recently was one of the most densely populated places on earth. This is one of many photos taken by Canadian photographer Greg Girard, who along with Ian Lamboth spent five years capturing images and conducting interviews to capture the culture within this notorious enclave within Hong Kong, China for their late '90's book 'City of Darkness: Life In Kowloon Walled City'. 300 interconnected high-rise buildings, all constructed without input from a single architect, housed 33,000 families and businesses in a tiny 0.01 of a square mile area.

For all the space we as individuals now have to digitally roam in our modern era, the average company has an infrastructure not unlike Kowloon Walled City, which was finally demolished in 1994. That 'rip and replace' cost the government HK$2.7 billion (US$350 million) in compensation to the estimated residents and businesses before transformation into a public park.

Despite the slick exterior image many companies create for themselves, the internal reality is typically a patchwork quilt of technologies layered over the years since the dawn of enterprise computing by a succession of inhabitants to serve specific business needs, both departmentally and across the organization. Many of these technologies are clearly modeled on outdated work concepts and processes, but the entire organization hangs together around tenured ideas in the collective mind of the organization. The resulting culture is not unlike the organic growth of the walled city structure above, and you have to feel for the IT professionals responsible for security and keeping it all functioning.

The shortcomings of 'Human Capital Management' - a term only a software engineer could love - are discussed by John Wookey, Executive Vice President of Social Applications at Salesforce (and formally at Oracle and SAP) on the website tlnt.com

...if there is any area that desperately needs a social model, it is HCM. People-centric systems should promote connection, communication, and collaboration. That is the core of the social enterprise.

Consider performance management, which is one of the most important processes for every company. Performance management systems are universally hated. Why? Because they create work for every employee in the company, while serving only to meet HR-driven compliance processes. Somewhere along the way in building these systems, we focused the core design on the wrong problem.

Saleforce have the firepower to define and evangelize what they mean by the word 'social' in the software marketplace effectively, but for most on the planet the word has so many layers of connotations and meanings it is loaded with baggage. A Google search on 'kowloon walled city social' yields 345,000 hits on the social problems there and the social workers who tried to solve them for example…

Nevertheless if there is an area within businesses which could historically always have been termed 'social' it is Human Resources/HCM. (interestingly the term 'human relations' predates HR/HCM).

Wikipedia on concerns about the term Human Resources:

One major concern about considering people as assets or resources is that they will be commoditized and abused. Modern analysis emphasizes that human beings are not "commodities" or "resources", but are creative and social beings in a productive enterprise. The 2000 revision of ISO 9001, in contrast, requires identifying the processes, their sequence and interaction, and to define and communicate responsibilities and authorities.

We've had an interesting battle between the now old ERP (Enterprise Resource Planning) engineering world creating technology to track humans as commodities and monitoring their  'performance' with sometimes questionable parameters, and more recently the 2.0 generation of more agile, human focused technologies. 2.0 as a term is now largely obsolete, absorbed into the mainstream and with a third '3.0' generation of computing no longer applicable to the way the digital world is transforming. More broadly 'Enterprise 2.0' sprang up to challenge the rigidity of older forms of database powered computing and to more closely map to the way humans interact, and was and is far more about people than tools.

For employees today, performance reviews are at the epicenter of their sense of recognition, value, and clarity of the goals of their employer, and directly affect their financial 'oxygen supply' of full time employment. Wookey is so right when he says 'Somewhere along the way in building these (performance review) systems, we focused the core design on the wrong problem'. In a previous pre-business computing era, when a job was for life and loyalty and longevity of service was a hallmark of service, an annual performance review might have been appropriate.

Work today rarely conforms to that ancient stereotype, with rapid change the norm. Somehow software anchored people processes have perpetuated mapping to archaic thinking and HR staff are all to often unwilling to go beyond their existing guard rails. Real time feedback loops and information sharing, which can be very challenging to design for collective use as a result of our individualistically focused digital culture, are nevertheless increasingly essential to genuinely and accurately monitor the health of individual  contributions and to track goal progress and attainment.

Sometimes given HR's location within the Kowloon Walled City like infrastructure amongst all the company silos, the reality is not immediately apparent that HR's limitations are often the weakest foundations of the entire crumbling social business edifice, and ripe for overhaul.

I've been pretty focused on this core area of practical change inside companies for the last eighteen months and the reality is that no two business cultures or urgent sets of business goals are alike, which makes much of the currently fashionable crystal ball gazing and framework suggestions somewhat moot. The tolerances are much finer than many realize and being too loose can result in failure of focus and uptake.

In the pragmatic real world, authenticity is key: there is much shallow bumper sticker sloganeering out there, but real change is scary and career threatening unless clear goals are seen to be feasible, desirable and attainable. Ideas perceived as unproven, bleeding edge or diffuse are also seen as career threateners. All too often toothless research and tentative pilot projects have skirted around the issues inside companies to superficially fulfill the obligations of those tasked with exploring advantages to the firm, minimizing their exposure to risk.

Many companies can soldier on with aged software and processes while meeting their financial targets, operating in a chronically inefficient constrained Kowloon walled city style that informally creates a pressure build up of reliance on human tacit knowledge, informal processes and exception handling to fill in the various competency gaps. The enterprise fault lines are different depending on the organization, but seismic shifts are almost invariably inconveniently disruptive.

The poor economy in most parts of the planet masks a reality that the war for talent has never been more competitive internationally. That talent is typically more agile and connected than ever before, and is very different to back offices used to grappling with digitally supercharged flows of documents and filing cabinets. Old paradigms mapped to modern technologies tend to create information log jams, which are one of the differentiators for quality -or otherwise - of business performance.

Unlike the dismantling of the Kowloon Walled City, there will be no big bang cultural rip and replace across entire businesses. What is happening at an increasing velocity is evolutionary change, and the human resources executive function needs to stay ahead of this wave to become the nucleus - or risk being subsumed into a new wave of chaotic fragmentation across multiple silos.

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