The human component of a company is not a resource that can be used and managed like other resources. By the same token, digital technologies are significantly more impactful than the technologies of the past, for they are changing the way we work, live, and communicate in a profound manner. It is up to us, both those of us who work in HR, and those who work in other departments, to make sure that we make the best use of these almost magic technologies without sacrificing our values, as well as all the aspects of our intelligence that cannot be translated into an algorithm or data. Sensitivity, understanding, empathy, sympathy, and intuition are examples of precisely the sort of “human technologies” that we have to preserve, develop and combine with the best of what Digital offers to us.

A growing number of shareholders and customers are attentive to the social impact of corporations. They will not tolerate “Digital abuse” and will not support and value Companies that profit unethically from these practices. As a result, CEOs and Boards will value the HR function only if it continues to work to deliver this magic thing that corporations like to call spirit, on top of their other work. At the same time they will expect from leading companies the use of state-of-the-art Digital technologies whenever they bring efficiency and add value to this human factor. There is no better role for HR managers than that of guardian of this human factor in the evolution towards the Digital. It does not mean that they will not be judged on their ability to recruit the best talents, or manage their administration well. Yet, what will make the difference for HR managers in this new era is going to be their ability to remain relevant and vigilant on the human side of the corporate equation.

What is happening?

HR is becoming more of an integrated system, a house of processes, open to the latest Artificial intelligence programs, and with consequently far less direct contact with employees. This is an increasingly prevalent fact in big companies, and it is not reversible. Digital technology brings speed, flexibility, efficiency to a function which badly needed it. It makes a lot of sense to look for it.

Yet, HR is also the function dedicated to Human issues and as such it needs to preserve its essence, which lies in its relationship to employees and to the corporate culture, as well as its role in maintaining and managing ethical concerns.

How can HR work effectively with digital technology ? Are the two compatible ? More importantly, can HR and management use the incredible resources provided by these new technologies without compromising the human values they are supposed to defend and do that for the benefit of cost-cutting, efficiency, or short-term gains ?

The answer is not obvious if one looks at past experiences. For example, the temptation is high for companies to go towards immediate gains in relation to cost. Digital technology can provide very efficient scanning of recruits, while reducing face-to-face meetings, interviews and traveling. By the same token, the use of robots and automation in the work place can greatly reduce payroll and increase efficiency and eliminate repetitive, hard and unsafe jobs. New technologies will also create new jobs in large numbers. Yet, these benefits can come at a great social cost to the actual and potential workforce of a company. Good and bad news are intertwined.

In addition, as the Facebook/Cambridge Analytics affair or the Volkswagen emissions scandal have shown, digital technology can be used to commit serious ethical and legal offenses. They can also be used to discriminate during the recruitment process on the basis of ethnicity, gender, health or political opinions, as has happened with a few companies. Taking this into account, we can ask ourselves if limits to the expansion of these technologies should be set as several CEOs of high tech Companies are suggesting. If so, who should monitor and enforce them ? Finally, what role can HR play in this transition ?

To start, it would be a mistake not to be optimistic about these new technologies. Avoiding constant traveling by means of conference calls or video conferences, using robots to handle thankless or dangerous tasks, using digital technology to make communication seamless in a company and to effectively communicate job offers are all positive and beneficial developments. Technological advances are neither essentially good nor bad. It is our use of them that makes them either harmful or beneficial to society, as Tim Cook, CEO of Apple, stated in his talk at MIT

All of these concerns are at the heart of the CEO and HR role. We will review in this article what seems to be the best way for HR to benefit from Digital without crossing any red line. Given this fact, will HR be a guardian of values and ethics or just a follower having to “clean” the damages caused by Digital ? As Dennis Gabor, the Nobel prize of Physics said once, whatever technology can achieve will, in time, be achieved. The only safeguards are the limits that corporations and society place on the use of these technologies.

This network of interpersonal relationships effectively creates the culture and image of the Company

One of the things that should be considered and protected in the transition to a more digital workplace, is precisely the human factor. Not only the employees, but also what is now called their emotional intelligence or resilience, their ability to sense a situation, understand another person’s viewpoint, connect with colleagues, clients and suppliers, and communicate their own viewpoints and feelings in a convincing way. This network of interpersonal relationships effectively creates the culture and image of the Company and determines the capital of trust enjoyed on which the Company can rely.

This paper will focus on how both HR and management can work to strike an effective and ethical balance between the human and digital components in the workplace. If digital technology is a tool, it is our responsibility to understand how to concretely use it for our needs, rather than let ourselves be dominated by it.

The passage to all Digital is a major cultural change

We cannot engage with this transformation in a naive way. The passage to Digital is not an “information technology » issue which should be left to technicians. Digital programs and processes are invading every single part of the company and are impacting the form and the content of all communication, as well as the way relationships develop, knowledge is transmitted, and company culture evolves. In order for this transition to happen in the best possible manner, it has to have the full support and attention of the highest levels of management, and their decisions must be guided by clear and forceful principles. We have seen, for example, how the mismanagement of globalization produced serious problems, for example in communities dependent of the automobile industry. We also saw how the lax enforcement of gender diversity initiatives created serious issues for companies such as Uber, Disney, and Fox.

One of the first issues that should be addressed is education and training. As we all know, ignorance breeds fear and mistrust. Few people today are actually aware of how algorithms or machine learning work. If they knew more about it, they would feel more empowered with respect to these technologies, less fearful, but also more aware of the positive changes and new opportunities that these technologies can bring to their careers. As an example, AT&T has announced that more than 100,000 employees will be retrained before 2020 to learn about modern telecommunication technology. The alternative for AT&T would have been massive lays-offs, leading to a destruction of their human capital, and a disastrous image for the company. Demystifying new technologies is a must.

Other initiatives can be taken to make the transition to a more automated workplace less disruptive to employees. Amazon, which was severely criticized at the beginning for treating its employees harshly, seems to have somewhat learnt the lesson. They are introducing several types of robots in their hubs without cutting jobs by cleverly capitalizing on the complementarity between humans and machines. They are also involving their workforce in the early stages of this transition. Time will tell whether they stick with this approach. Yet, we are hearing more and more about the use of “cobots,” i.e. robots that cooperate with human but do not replace them in the workforce.

A case to watch is that of the car industry. There is no regret to the fact that many of the more dangerous and repetitive tasks of the auto industry are now increasingly taken care of by machines and programs. Yet, transitioning the workers and technicians to new roles in the company or to other jobs outside the industry and eventually new jobs created by these technologies is not going to be easy. It will become an increasingly complex political issue, similar to the transition out of the coal-mining jobs. The loss, even of grueling and harmful jobs, is always painful for a community and very often newly created jobs go to new generations of workers.

HR’s role in this process is to anticipate such changes and their social consequences, and to come up with creative initiatives for making that transition socially acceptable. This will call for cooperation with universities and learning centers to develop new skills and reorient careers. It will take a lot of effort from HR to communicate these changes and motivate employees to participate in them. The so-called millennial generation- those born into a fully digital world – will have less difficulties than older generations, and this transition will be particularly difficult for mid-career employees.

New best practices with the help of Digital and their limits

But the reality is that it can also lead to various sorts of abuse

Seamless communication is a wonderful development in any workplace. At the end of the day, a Company is first a human community sharing goals and values. Having seamless communications will create full transparency, and everybody will be able to obtain information at the touch of a screen or keyboard. But the reality is that it can also lead to various sorts of abuse. It is fundamental that we avoid misuse of email communication, and that we respect the personal lives and data of employees, as well as confidentiality, while complying with ethical and legal rules. The risk of this sort of abuse has always existed, but has multiplied exponentially with the rise of seamless communication.

HR practices are going to be watched. It is a positive development for HR to be able to streamline the recruitment process by means of digital technology, but the criteria for eliminating candidates have to be transparent and ethically and legally acceptable. The final selection of a candidate has to be decided by one or several responsible managers and not by a program. There is nothing wrong in managers partly basing their decisions on their “internal algorithms”, however subjective and intuitive, because a human judgement is more acceptable for a candidate than the judgement of a machine. The same is also true of promotions and layoffs. People will not accept managers hiding behind software programs or algorithms for decisions with such profound human consequences.

Thanks to technology and social networks, HR will now have easy access to active candidates applying for positions, as well as so-called passive candidates working with competitors or clients, and who can now be sought out with specialized programs. The counterpoint to this is that their own employees are just as reachable by other companies. This will put pressure on companies to define in an ethical and legal way how much loyalty is required from employees. For example, it will be more and more difficult for companies to reinforce non-competition rules if they themselves are aggressively poaching from their competitors. The good news is that the best way to retain talents will increasingly come down to being the best employer with the best practices. Increased fluidity in the labor market is good news.

Performance appraisal is an example of an intense human act which is at risk of becoming meaningless in many companies. The Digital is not necessarily to be blamed but its arrival has not helped. 70% or more of the performance evaluation process has now, in some companies, become a spreadsheet exercise in which managers check whether objectives were met or not. Existing skills and attributes are evaluated by email or at best in a video conference. The moment of discussion when the manager is supposed to have a real dialogue with the employee is reduced to a minimum. What is lost is huge and impossible to measure. It is the ability of managers to influence their employees and also to understand what explains their performance. CEOs and HR departments should fight for its preservation, even if it looks like an outdated practice. Digital is not an excuse for less contacts, but on the opposite it makes room for a continuous and sincere dialogue.

It is amazing that while companies have increased their use of internet customer surveys, they have at the same time also increased, through the use of wearable and electronic cameras, their ability to “keep an eye « on what their employees do and do not do. The ambition behind using these technologies is to optimize quality of service. If  not used wisely and with moderation it will have adverse effects on motivation.  Again, it is up to the CEO and the HR manager to protect their employees against such abuses.

Coaching is probably the best example of a positive interaction between the human and the digital approach. Everybody agrees that the face-to-face coaching of young employees and newcomers by experienced employees is the best way to accelerate the acquisition of competencies and also to integrate a new employee in the company. It used to be difficult because it was time-consuming and required traveling from both sides. With digital technologies, it has become a lot easier. Companies that believe in coaching can organize  services where all experienced employees are given a few coaching assignments. They can be rated on their capabilities by the people they coach, and scheduling sessions at convenient times has become much easier, at virtually no communication or travel cost. Digital technology could help employees and their coaches to develop a true relationship that goes beyond the simple transmission of knowledge and evolves towards substantial career counseling. It will make managers more interesting and it will facilitate the development and the retention of internal talents.

Finally HR will be technically able to better anticipate situations such as changes of trends, simulate these changes and their implications,develop contingency plans and  combine the flexible workforce and the more stable one. This will be a progress if it is used to be more creative and attentive to social consequences.

Cultivating the Human factor remains at the heart of the HR function

Research in psychology has shown that on top of certain requirements relative to what is traditionally called intelligence (and which is often and rather poorly measured by I.Q. testing), there is another form of intelligence which is instrumental in the success of a leader, a team, or an individual. This intelligence has to do with knowing oneself, being sensitive to others and their situations, having the ability to connect and to communicate positively and influence others. This type of intelligence has always played a big role in the successful careers of the past.

If managers increasingly hide behind a screen or phone, they will lose their human antennas

To develop this form of intelligence one needs to practice it in every possible contact and situation. It is obvious that if managers increasingly hide behind a screen or phone, they will lose their human antennas. This is a serious issue. The quality of human relations within the Company depends a lot on the form and the content of everyday communication. Managers who constantly meet with people, facilitate roundtables, take the time to visit locations, and understand the context in which their employees work are incredibly more effective than those who don’t. Of course, the “All-digital” will greatly simplify their schedule and replace a few exhausting long trips with video conferences. If the relationship exists and is already strong, video conferences and conference calls can be very effective but if there is not a solid ground for their relationship, it will remain superficial. These qualities have to be developed early on. It is important that direct contact remains the norm in corporations whenever it is possible and efficient to do so. Though customer surveys and other digital means of quality control are precious and powerful tools, they do not make direct personal contact irrelevant. A more sensible approach would be to appreciate and use the different capacities of both digital and personal evaluations.

Again, it is up to the management  to set up the tone, to react when a harsh email is sent to somebody instead of addressing a complicated situation in a face to face meeting, and to select managers who like to be in contact with their people and know how to connect emotionally with them. It impacts the capital of trust a company has or does not have and it also makes the difference between a company culture which has a competitive advantage, and which employees are proud of, and a company culture which is either not attractive or simply inexistent.

This respect of the Human factor is what needs to complement the move to the all-Digital and will help calm the fears that, for good reasons, people have of a misuse of Digital as simply another way of cutting cost and increasing productivity regardless of human consequences.

Conclusion

The acronyms H.R. for Human Resources and A.I. for Artificial Intelligence have something in common. They are both misnomers. Companies should not look at human employees as a “resource,” and treat them like they treat material resources. This simple yet obvious point is sometimes forgotten. By the same token, whether machines will ever be able to attain forms of intelligence comparable to those of human beings is still an open question and the use of this word is questionable . But the two acronyms have taken root and the question is how they will best coexist in the context of a working community.

At the end HR could get a new image as a function that would be able to be more creative and more responsive. This function could benefit from modern digital tools and learn to use data analytics in a responsible and ethical way, to better understand their employees’ state of mind. It would also help itbe more in tune with the new generations, manage cycles in a smoother way and develop knowledge transfer between generations. Leading companies will be striving for it.

Pierre Bismuth
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