Human resources has moved firmly into the strategic core of organisations, with 65% of senior leaders now viewing HR as a key business enabler. New research from Boston Consulting Group and the World Federation of People Management Associations shows that companies with strong HR capabilities benefit from lower staff turnover and fill critical roles up to 18 days faster than their peers.
The findings, published in the Creating People Advantage 2026 report, are based on insights from more than 7,000 HR and business leaders across 115 markets.
Strategy rises, but execution lags
Despite this growing influence, HR faces a major challenge. Over half of leaders, 51%, say administrative workload still limits HR’s ability to operate strategically.
This creates a clear tension. HR is expected to drive transformation and business value, yet much of its time remains tied to operational tasks. Organisations that address this gap are better positioned to unlock HR’s full potential.
AI adoption grows, but impact remains uneven
Nearly 70% of companies report using generative AI in some form, particularly in areas such as recruitment, reporting and learning. However, only 38% believe it holds strong relevance for their organisation today.
The issue is not access to technology, but how it is applied. Many organisations struggle to scale AI due to concerns around data privacy, compliance and a lack of clear risk management processes.
The report highlights a shift in focus. Real value will come from redesigning workflows and integrating AI across the employee lifecycle, rather than layering it onto existing processes.
Africa shows strong momentum
Across Africa, perceptions of HR’s strategic value are even stronger.
In South Africa, 73% of C-suite leaders see HR as a key driver of performance. In Nigeria, that figure rises to 95%, reflecting a strong expectation that HR contributes directly to business strategy.
South Africa also shows above-average progress in building generative AI capabilities, while Nigeria places strong emphasis on future adoption, despite current capability gaps.
Digital ambition outpaces capability
Digital transformation remains a top priority, yet execution continues to lag.
HR leaders are under pressure to automate processes, deliver data-driven insights and improve the employee experience. While digital tools are rising in importance, current capability levels remain among the lowest measured.
The gap is particularly visible in Africa, where organisations rank digital solutions and HR systems as critical future priorities but report limited readiness today.
Skills transformation still in early stages
Many organisations are shifting toward skills-based talent management, but progress is uneven.
Just over half use skills-based matching, and fewer than half run structured reskilling programmes. Only 11% have implemented a full, enterprise-wide skills framework.
This gap affects long-term performance. Skills investment links directly to retention, faster onboarding and the ability to deliver on strategic goals.
What HR leaders must prioritise
The report outlines four key focus areas for future-ready HR leadership.
HR must align closely with business strategy and work alongside CEOs to drive value. It must lead digital and AI transformation across the organisation, not only within HR. Building workforce and leadership capabilities at scale remains critical, alongside embedding strong change management practices to support transformation.
These priorities signal a shift in expectation. HR is no longer a support function. It is a driver of business performance.
A defining moment for HR
According to Philipp Kolo of Boston Consulting Group, the opportunity is clear.
HR now has the tools and influence to shape business outcomes. The challenge lies in execution, from upskilling teams to redesigning how work is done.
Peck Kem Low, President of the World Federation of People Management Associations, adds that success will be measured by value created, not activity delivered.
As organisations move deeper into the AI era, HR’s role continues to expand. The next phase will depend on how effectively leaders turn ambition into action.
