The human resource (HR) function needs to evolve from its traditional practices into being a strategic partner and a critical enabler for businesses as well as to adapt to new technology and demographic shifts.
A joint new study conducted by the Asian Institute of Finance (AIF) in partnership with PricewaterhouseCoopers Advisory Services Sdn Bhd to examine the future role of HR in financial services showed that competition from non-traditional HR sectors has increased.
CIMB Group chief people officer Hamidah Naziadin said with the rapid pace of change taking place, both within the industry and globally, HR functions should focus on new measures to assist organisations to deal with those changes.
“We need to get ourselves very ready before it’s too late,” she said in a statement.
The findings suggest that HR function is not yet a strategic partner to business due to its overwhelming focus on operational activities.
A majority of HR personnel (79%) also claimed that the current HR role involves both operational and strategic business tasks but only 17% of non-HR senior management agreed.
The study also revealed constraints such as insufficient investment; limited resources and lukewarm support from top management are holding HR back at the strategic level.
The report findings highlight today’s businesses and new generation of HR really need HR capabilities and measurable competencies that do not just support the business strategy, but also enable the business to design and execute strategic priorities that capitalise on HR’s capabilities.
However, AIF CEO Dr Raymond Madden (picture) said despite a gap between the expectations of the business leaders versus what HR is currently delivering, the study found a positive attitude towards the HR transformation agenda.
“Such transformation requires a mandate and strong support from top management,” Madden added.
Currently, AIF is developing an HR capability framework that will form a reference point for the design of an HR accreditation programme for HR professionals in the financial services industry.
This framework will align HR competencies and capabilities with the career paths of HR professionals as it differentiates between core and specialised competencies relating to different levels and positions within HR.
Entitled “Redefining the Role of HR across the Financial Services Industry: A National Imperative”, the report presents the results of a survey conducted in participation with a total of 550 respondents from HR and other business lines within 15 financial institutions.
AIF was jointly established by Bank Negara Malaysia and the Securities Commission Malaysia, to enhance human capital development and talent management across the financial services industry in Asia.
The institution works closely with affiliate institutes, namely Asian Institute of Chartered Bankers and Asian Banking School, Chartered Institute of Islamic Finance Professionals, Islamic Banking and Finance Institute Malaysia, The Malaysian Insurance Institute and Securities Industry Development Corp.