Why Human Resources Is Dead


According to Wikipedia "human resource" was first used by economist John R. Commons in his book, The Distribution of Wealth, which was published in 1893, over 120 years ago. The term also gained a lot of traction in the 1910′s and 1920′s where it was quite literally used to mean that workers were seen as capital assets. Many workers around the world are still seen as capital assets, which is why it should come as no surprise that actual synonyms for "employee" include: cog, servant, and slave. It should further come as no surprise that according to research firm Gallup, only 13% of employees around the world are engaged at work. The department created for managing these capital assets was, of course, called "human resources" and is perhaps the most known part of any organizations ─ oftentimes the most feared, and is now, the most...dead.

The idea of thinking of employees as capital assets is antiquated, but for many it's not enough to simply talk about how HR is changing and what the new role of HR is. Companies are dropping the term "human resources" altogether and are shifting towards more "people centric" terms. Titles such as: chief people officer, VP of people operations, head of talent, chief talent officer, and others are becoming more commonplace; and titles such as Chief Human Resource Officer are starting to fade away. This isn't a new thing. Some companies have had these titles and departments for several years already. But now that the conversation around the future of work has taken center stage, I've seen this transition accelerate dramatically. It might sound superficial, after all, simply calling the same function something else doesn't mean anything will change. However, the way we refer to something and how we speak about something really does make a difference.

Consider Cisco's recent change of their Chief Human Resources Officer Francine Katsoudas' title to Chief People Officer. Many other examples of this change exist at companies all over the world, here are a few: Laszlo Bock is SVP of People Operations at Google, Susan Chambers is EVP of the Global People Division at Walmart, Pat Wadors is the SVP of the Global Talent Organization at LinkedIn, Anne Byerlein is the Chief People Officer at Yum! Brands, and the list goes on and on. I don't view renaming the department as any kind of solution, but I do see it as the first stepping stone for an organization to commit to making change. Most of the companies I have been speaking with or researching ─ including Cisco, Glassdoor, Google, LinkedIn, and others ─ have all made considerable strides in rethinking what the purpose of traditional "HR" is and all of these companies have moved on from looking at employees as capital assets.

I think in the coming years we will see more companies shift away from "HR" related terminology to focus on things related to people and talent. The question is, will these organizations do more than change names and titles? Will they actually rethink what their roles and functions are? I'm certainly optimistic about this transformation! If employees aren't capital assets, then they shouldn't be treated as such. It's time to get rid of human resources.

Jacob Morgan is a futurist, best-selling author and keynote speaker, learn more by visiting The Future Organization.com or check out his latest book,"The Future of Work: Attract New Talent, Build Better Leaders and Create a Competitive Organization," on Amazon.