HR IN THE PUBLIC SECTOR THE 2016 ANNUAL HR TRENDS SURVEY

Transcription

1 HR IN THE PUBLIC SECTOR THE 2016 ANNUAL HR TRENDS SURVEY

2 Introduction In the next twelve months, no organisation in the public sector will be exempt from the need to change and reorganise its people to deliver public services in different ways. In fact, this challenge that has framed our 40th anniversary year in which I have been president of the PPMA, looks set to remain with us for many years ahead. As the public sector takes on a new shape, people managers have a critical role to play in building organisations with the right culture and capability. It is our skills which are critical to delivering successful change, supporting people on the front line and at the top of our organisations along the way. But to what extent do our employers value the role of HR? Do we have the resource we need to do the job effectively? And what are the challenges and risks we see getting in the way of success? The answers to these and other questions are contained in this our first annual research into the role of HR in the public sector. They come from a survey conducted among our members earlier this year which gives a clear picture of the role HR is playing in the change agenda. Some of the results are very encouraging. It is good to know that our members are respected within their organisations and their advice is listened to. It is less reassuring to hear their concerns that they lack the resources to support the delivery of the immense challenges they face. We hope this report will be read not only by those with a direct interest in the findings, but also among managers and leaders in the sector who may benefit from understanding in greater detail what is on the minds of the people who they rely on to deliver their reform agenda. Barry Pirie, President, PPMA Associate Director, People and Business, Wiltshire Council 2

3 Executive Summary The headline findings from the 2016 Annual HR Trends Survey are as follows: HR managers in the public sector generally enjoy a high degree of respect from their colleagues. Their advice is listened to and they are seen as strategic partners and enablers in delivering change. Professional HR expertise is embedded in most organisations. HR strategy is usually set by a head of HR or a director with an HR background. This is set to remain the case in the year ahead. A sizeable minority of practitioners say perceptions of their role are inaccurate and believe they should be more closely involved in change management strategy. Most HR professionals are satisfied with the resources they are given to carry out their responsibilities, but an overwhelming majority fear that they will face shortages of people and skills in the near future. Most expect major changes in the way HR is organised such as collaborating with external organisations, more flexible ways of working and outsourcing some activities. Many of these activities, while introducing innovation, will also reduce costs. Opinion among HR managers is divided over whether the use of consultants and temporary staff will increase in the year ahead, possibly reflecting uncertainty over the effects of reduced permanent headcounts and budgets. Most HR departments have already set their strategy for the next two years. Public sector HR professionals expect to have to cope with a range of challenges in areas including strategic workforce planning, managing change, organisational restructuring and introducing new ways of working. 3

4 The Research in Depth This section of the report provides a more detailed overview of the five key themes emerging from our research. It is based on responses to a survey which was sent out to our 533 members and collated earlier in HR enjoys high status in the public sector With major changes in the way public services are organised and delivered already under way, the position of HR managers is crucial. It is essential that high quality, effective HR management strategies are developed to deal with new ways of working. The results of the PPMA Trends Survey show that, fortunately, HR managers are respected in their organisations. Almost three quarters of respondents to the survey said their input was valued by leaders across their organisations (74%) and when they give advice about managing change, people listen (70%). 74% say the input of HR and OD is valued by leaders About two thirds said their leadership teams see HR practitioners as strategic partners (67%) who are involved in the early stages of planning (66%), although slightly fewer are seen as the people who enable the delivery of change (53%). A major factor in this high status appears to be that professional HR expertise is firmly embedded in organisational structures. Some nine in ten respondents said HR strategy was usually set either by the head of HR or at least by a director with a background in the specialism (Head of HR/HR director 66%, director with HR background 23%). Nevertheless, a sizeable minority of HR professionals are not happy with the way they are seen: about a quarter say that perceptions of their role are inaccurate (25%). This view is backed up by comments made by several respondents. Asked how HR could make a more significant impact in their organisations, responses included "ensuring that HR is informed and kept in the loop when any changes are being thought of", "more of a strategic overview to influence decisions" and "increased challenge of negative perceptions by senior managers". 2 Concern over future resources to do the job At a time of major reorganisation in the public sector, it would make sense for HR managers to be given the resources needed to manage the change. While the 4

5 survey found that current resource levels are satisfactory, however, it carries a powerful warning that this may not be so for long. Asked about their current budgets, survey participants were evenly split, with about half saying they are adequate and slightly more complaining they are not (47% adequate versus 49% inadequate). 70% say HR budgets will fall There is greater dissatisfaction with the size of HR teams, with a fraction more than half saying they are inadequate compared to those who said they are big enough (51% inadequate versus 45% adequate). Most say that the use of consultants is at the right level currently. in the year ahead But there are serious concerns about the future. An overwhelming four out of five said they expected headcount in their organisations to fall in the year ahead (80%) while only a tiny number expect any increase (4%). There are the same fears for budgets: more than two thirds expect to see a decrease in their HR budget in 2016/7 (70%) and roughly the same number expect their teams to be reduced (64%). Expected reductions in resources are reflected in the changes senior HR practitioners expect to see in the year ahead, many of which will reduce costs. These include delivering more services in collaboration with third parties (79%), increasing home and flexible working (71%), reducing the number of buildings in use (61%) and outsourcing "for profit" parts of their organisations (53%). Several respondents commented on the need for more resources when asked what changes would help HR make more impact. One called for more time to embed changes, while another said: "increase HR capacity - more resources!". 3 Change ahead for how HR teams work The major reforms in the way public services are delivered have serious implications for HR professionals leading the change management required. The survey showed many are aware of the challenge. Many of those answering the survey expect HR management itself to change. They expect to see HR services being shared - four in ten said this would be with other councils (42%) and a third with other public sector bodies (35%). Outsourcing of HR activities will continue to be a major feature of the landscape. Nearly a fifth of respondents (19%) expect it to increase in the year ahead and one in ten expect it will happen for the first time in their organisations 35% Expect HR services to be shared across public sector bodies in the future 5

6 (9%). No respondent thought HR outsourcing would decrease. More than a third expect to see increasing use of contractors and other temporary staff as their workforce becomes more flexible (38%). A fifth of respondents, however, thought the use of temporary resources would be reduced (23%), perhaps reflecting a view that resourcing overall will be cut. Despite the expected instability, though, there is one area in which little change is expected. Most thought the person responsible for setting HR strategy in the year ahead would remain the same (74%). 4 Fears over capability to deliver change With big changes facing public bodies in the UK, the main fear among HR leaders is the lack of the people and skills they will need to guide their organisations through the challenging times ahead. Building the skills needed to support their organisations was ranked top among concerns in the survey, put in first place by one in four respondents (25%) followed by the ability to retain staff (20%). The third most serious challenge was the inability to deliver change quickly enough, put in first place by one in six (17%). However, most HR departments appear well prepared for the challenges ahead. Nearly half had set out their strategy for the next two years and were already implementing change (47%), while a further four in ten were currently setting their strategy (38%). Reflecting some instability in current conditions, one in seven were awaiting a new business plan before setting their strategy (14%). 5 Planning the workforce of the future The survey shows that public sector HR managers are aware of the huge changes they will be expected to steer through their organisations. 80% Expect to spend more time 47% Of organisations have set HR strategy for the next two years and are implementing change They identified strategic workforce planning as their main concern, ranked as the most serious by almost a third of respondents (32%). Four out of five said they expected to spend more time dealing with this in the year ahead (80%). Almost as many (79%) said they would spend more time managing change. focused on strategic Organisational restructuring was the top concern for workforce planning in 2016 one in five (21%), an area in which more than two thirds expect to spend more time (69%). Nearly three quarters said they expect to spend more time introducing new ways of working (72%), the top concern for one in ten of respondents (11%). 6

7 Conclusion The single most encouraging theme from our research is the extent to which HR practitioners are playing a central role in driving change in public sector organisations. As leaders seek to reshape their organisations, it is the specialist knowledge and skills of people managers which are being called on to design the future shape of our organisations and put in place people strategies which are fit for this new business context. There is also challenge ahead however. Faced with fewer resources to deliver the change agenda for our organisations, HR leaders and their teams must change too. It is down to us to be creative and proactive in demonstrating how we do things differently to support our organisations in new ways in a sector whose demands will not only be fundamentally different from what went before but will continue to evolve and change. If we can do this, I am sure people managers will continue to have a seat at the top table of public sector organisations and our influence will grow. Sue Evans Vice President Elect, PPMA Head of Human Resources and Organisational Development, Warwickshire County Council 7

8 About the PPMA The Public Sector People Managers' Association, PPMA, is the voice and association for Human Resources and Organisational Development professionals working within the public sector. You can find out more about what we do or join at: 8