In the ever-evolving business and industry landscape, human resources (HR) has become a critical factor in the success of the organization. As we approach 2025, the question arises, how should HR practices evolve to meet the changing demands of the workplace.
From technological advances to changing employee expectations, the HR function is undergoing a transformation that requires strategic adaptation. In Part 1 of my blog series, I explore the key trends and insights that will shape the HR landscape in 2025 and beyond, and the adjustments needed in terms of HR roles.
Megatrends shaping HR
To understand the future of HR, it is important to first understand the megatrends that are shaping the world of work. One such resource, “Megatrends 2050” , forecasts the key changes that will impact all industries.
- demographic change and aging population:
The aging workforce requires HR to balance the needs of older employees with those of younger generations. This includes, for example, the introduction of flexible employment models for retirees and mentoring programs for knowledge transfer.
- technological advances and automation:
HR needs to redefine job roles and upskill the workforce to acquire digital skills such as in automation and AI. This includes continuous learning initiatives and AI-driven recruitment processes.
- globalization and remote work:
Remote work and globalization require HR to focus on virtual team building, cross-cultural training fostering an inclusive climate, and communication platforms for effective collaboration.
- environmental protection and corporate responsibility:
HR plays a role in integrating sustainability into the corporate culture, e.g., through green initiatives and recruiting environmentally conscious talent.
- changing world of work and gig economy:
HR must manage a diverse workforce by creating hybrid employment models that offer fairness and flexibility and accommodate the rise of freelance and contract work.
Technological innovations in HR
The impact of technology on HR is undeniable, and the rapid pace of technological advancement requires HR professionals to keep up with the latest trends. Accenture’s Technology Trends 2023 report highlights several key technological changes that will have a major impact on HR. These include:
Extended Reality (XR): XR technologies such as virtual reality (VR) and augmented reality (AR) offer new opportunities for training, onboarding, and employee development. HR departments can use XR to create immersive learning experiences to improve employee engagement and retention of learning.
Blockchain: Blockchain technology can streamline HR processes such as applicant verification and secure employee data management. Its decentralized nature ensures data accuracy and reduces the risk of fraud.
AI and automation: AI-driven chatbots and virtual assistants are transforming how employees interact with HR. These tools can handle routine inquiries, allowing HR professionals to focus on more strategic tasks.
Megatrends 2023 and HR’s response
UKG’s Megatrends 2023 report offers insights into HR’s response to the challenges and opportunities presented by the future of work. It highlights the importance of a culture that puts people first and where employees feel valued, empowered and motivated to do their best. This fits with putting “employee experience” at the center of HR strategies.
In addition, the report emphasizes that HR is data-driven. The wealth of data generated by HR processes can be used to identify trends, predict future needs and make informed decisions. This requires HR professionals to develop data analysis skills and adopt technology-enabled approaches to their work.
HR roles of the future
With the development of human resources, the tasks within the HR department are also changing . In order to meet the requirements of 2025 and beyond, several new HR roles could emerge there. This is especially true for larger, internationally operating companies:
Employee Experience Specialist: This role focuses on creating a positive and meaningful employee experience within the organization. The role designs employee-centric programs, promotes a healthy work environment, and enhances employee well-being. To achieve this, on the one hand, the role should be positioned high in HR to give greater emphasis to change impulses. On the other hand, this role should continue to take on 40-50% operational work in various HR disciplines (e.g., through rotations) and/or actively participate in HR digitization projects to stay close to the grassroots. This role acts as a valued facilitator and Continuous Improvement expert who can move across all levels of the organization.
Data analyst and insights manager: Given the increasing importance of data for decision-making in HR, professionals who specialize in analyzing data and interpreting insights will become indispensable. They will transform raw data into actionable insights to generate insights and recommendations for action.
AI and Automation Strategist: As AI and automation become an integral part of HR, professionals in this role are responsible for implementing and optimizing AI-powered solutions within the organization. This role, which will work closely with top management and likely reside in the CTO’s area, ensures that AI technologies align with the company’s HR goals and ensures that governance (including privacy) and employee engagement processes (works councils) required when implementing new technologies are adhered to.
In addition, existing roles in HR (e.g., HR business partner, HR generalist, talent acquisition, payroll) need to be readjusted to align them more closely with employee experience and internal and external customer needs. Furthermore, existing HR roles should be critically reviewed to see which work packages can be automated step by step.
Conclusion: Adjustments for success
The evolution of HR to 2025 is very dynamic, shaped by technological advancements, changing workforce expectations with an emphasis on more balance between work & live. To succeed in this environment, HR leaders must make data-driven decisions, leverage new technologies, and apply innovative approaches to employee engagement and development. By creating new HR roles that meet these demands, companies can position themselves for success in the years ahead.
In summary, as we move into 2025, HR organizations will play a central role in driving business growth and success. By harnessing the power of new technologies for HR through the creation of new roles, focusing on the employee experience, and implementing a forward-thinking mindset and culture, HR can confidently meet the challenges and opportunities of the future.
Part 2 of this blog series: Changing existing HR roles.
Part 3 of this blog series: What does this mean for HR departments in SME’s?