1. HR in Indian Companies (Last Decade) –
From Administrative to “Business Partner” (but unevenly)
Over the last decade, HR in Indian organizations has formally transitioned from a transactional, administrative role into what is widely termed a “business partner.” Earlier, HR’s responsibilities were largely limited to payroll, compliance, and documentation. With business growth and increasing complexity, organizations expected HR to contribute to strategy, whether in workforce planning, organizational design, or leadership development. However, while the designation changed, the depth of change often did not. In many companies, HR began attending business meetings and using strategic language, but its role remained largely execution focused. It continued to respond to hiring demands, implement policies, and manage exits, rather than proactively influencing decisions such as team structures, capability gaps, or leadership effectiveness. This created a gap between expectation and reality. HR was positioned as strategic but not empowered or prepared to act as one. As a result, its credibility did not grow in proportion to its perceived importance.
Recruitment-Centric Identity
A defining feature of HR’s evolution in India has been its strong tilt toward recruitment, particularly during high-growth phases in IT, services, and startup ecosystems. Hiring became the most visible and measurable output of HR, and therefore the easiest way to evaluate its performance. Metrics such as time-to-hire, cost-per-hire, and number of positions filled became central. While this helped organizations scale rapidly, it also narrowed HR’s focus. The function increasingly behaved like a supply chain for talent, concentrating on filling vacancies rather than questioning whether the roles themselves were well-designed or aligned with long-term business needs. For example, organizations often hired aggressively without investing equally in onboarding, training, or capability development, leading to high attrition and skill gaps later. In effect, HR enabled growth in numbers, but not necessarily in strength. This recruitment-heavy identity limited HR’s ability to contribute to building a resilient and future-ready organization.
Policy-Driven, Not Trust-Driven
Another significant characteristic of HR in Indian companies has been its reliance on policies and processes as the primary means of managing people. Attendance rules, appraisal systems, and compliance frameworks brought structure and consistency, which were necessary as organizations scaled. However, over time, these systems began to replace human judgment, flexibility, and trust. Employees started experiencing HR as a function that enforces rules rather than understands context. This leads to an important question, could HR have realistically functioned as an independent and unbiased entity, given that it operates within the authority of management? In reality, complete independence may never have been feasible. HR is structurally part of the organization and accountable to business outcomes.
The more practical question, therefore, is whether HR could have built credibility despite these constraints. This is where the idea of being “credible within constraints” becomes relevant. For example, during a demerger in an IT company where the R&D team had to be let go, the decision itself was driven by business necessity and could not be reversed. HR’s role was not to oppose the decision, but to manage its execution responsibly. By working with management to arrange campus-style interviews and placement opportunities, HR ensured that affected employees were given a fair chance to transition. This did not change the outcome, but it changed the experience and perception of fairness.
Such actions highlight that while HR may not control decisions, it can influence how they are made and communicated. Unfortunately, in many organizations, HR relied too heavily on policy enforcement without investing enough in transparency, consistency, or humane execution. This created a perception that HR was aligned only with management interests, leading to erosion of trust. The issue, therefore, was not alignment with management, but the absence of visible effort to balance that alignment with fairness and empathy.
Rise of HR Tech (but shallow usage)
The adoption of HR technology was one of the most visible changes in the last decade, with organizations widely implementing HRMS platforms, applicant tracking systems, and performance management tools. These systems brought efficiency by automating routine tasks, ensuring compliance, and centralizing employee data. However, their usage largely remained operational rather than strategic. In many organizations, HRIS platforms were primarily used to generate routine compliance reports such as attendance logs, payroll inputs, and statutory records because these were immediate business necessities.
What remained underutilized were the more powerful modules, particularly HR analytics, which had the potential to provide deeper insights and support better decision-making. This reflects a broader pattern where usage was driven by compulsion rather than intent. For instance, attendance data was meticulously tracked and used for salary processing, but rarely analysed to understand patterns of leave availing, absenteeism trends, or burnout indicators. Such insights could have directly informed more responsive and effective leave policies or workload planning.
Similarly, large volumes of employee data were available within these systems, but limited effort was made to connect this data to outcomes such as performance, retention, or engagement. As a result, while HR became more efficient in managing processes, it did not significantly enhance its ability to influence strategy. The true value of HR technology lies not in automation alone, but in its ability to generate actionable insights and this potential largely remained unrealized because the focus stayed on what was required, rather than what was possible.
What Must Change to Preserve HR’s Sanctity
From “People Management” to “Capability Building”
For HR to remain relevant, it must move beyond managing day-to-day employee processes and focus on building long-term organizational capability. People management typically involves activities such as hiring, performance reviews, and employee engagement initiatives. While these are important, they do not necessarily ensure that the organization is becoming stronger over time. Capability building, on the other hand, focuses on developing skills, creating leadership pipelines, and preparing the workforce for future challenges. For example, instead of only filling roles, HR should assess whether employees are being trained for evolving business needs or whether future leaders are being systematically developed. This shift requires HR to think beyond immediate requirements and take ownership of the organization’s long-term strength and adaptability.
Many large organizations have already begun investing significantly in capability building through structured learning programs, leadership development initiatives, and future-skills training, recognizing that long-term success depends on strengthening internal talent rather than just expanding headcount. However, a substantial number of companies, particularly those that have grown rapidly or operate in traditional models, still have considerable ground to cover. Their focus continues to remain on immediate operational needs such as hiring and short-term performance, with limited attention to systematically developing skills, building leadership pipelines, or preparing the workforce for evolving business demands. As a result, while a few organizations are moving ahead in creating resilient and future-ready capabilities, many others are still playing catch-up, risking a widening gap in competitiveness and organizational strength.
Become Custodian of Fairness (Not Just Compliance)
Compliance ensures that organizations follow laws and internal policies, but fairness determines how employees experience the workplace. HR must expand its role from enforcing rules to ensuring that decisions and systems are equitable and just. This includes addressing issues such as biased promotions, unequal pay, and inconsistent treatment across teams. For instance, two employees in similar roles should not experience vastly different outcomes without clear justification. HR must also be willing to question decisions that may be legally compliant but ethically questionable. Acting as a custodian of fairness requires both courage and consistency, as it may involve challenging senior leadership. Without this, HR risks being seen as a function that protects the organization at the cost of its people.
Data-Backed Decision Making
Modern organizations generate significant amounts of data, and HR must leverage this to improve decision-making. Instead of relying on intuition or anecdotal evidence, HR should use data to identify trends, measure effectiveness, and predict outcomes. For example, tracking quality of hire can help determine whether recruitment strategies are effective, while analysing attrition data can reveal underlying issues such as poor management or lack of growth opportunities. Similarly, employee feedback data can be used to assess engagement and identify areas for improvement. However, collecting data is not enough, HR must also act on it. This requires building analytical capability within HR teams and fostering a culture where decisions are questioned and validated through evidence.
Redefine Performance Management
Traditional performance management systems often focus on annual appraisals, ratings, and forced distributions, which can create anxiety and competition rather than improvement. Employees may focus more on securing ratings than on actual performance or development. HR must redesign these systems to emphasize continuous feedback, clear goal-setting, and measurable outcomes. For example, regular check-ins between managers and employees can help address issues in real time, rather than waiting for an annual review. Additionally, performance metrics should be aligned with business outcomes and individual contributions, making evaluations more objective and meaningful. The goal of performance management should be to help employees grow and succeed, rather than simply categorize them.
Build Trust as a Core Metric
Trust is the foundation of any effective HR function. Without trust, employees are less likely to share concerns, accept feedback, or engage fully with the organization. Building trust requires consistent behaviour over time, including transparent communication, fair decision-making, and impartial handling of conflicts. For example, when employees see that similar situations are handled consistently, they are more likely to perceive the system as fair. HR must also ensure that communication is honest and clear, even when decisions are difficult or unfavourable. Treating trust as a measurable outcome through employee feedback and engagement surveys can help HR track its effectiveness. Ultimately, trust determines whether HR is seen as a credible and reliable function or merely an administrative necessity.
Bottom Line
Over the last decade, HR in India expanded its scope but often failed to deepen its impact. The core issue was not a lack of evolution, but the superficial nature of that evolution.
Going forward, HR does not need to become independent, it needs to become credible within constraints. Its relevance will depend on its ability to combine business alignment with fairness, data with judgment, and execution with courage.
