More than half of senior leaders say administrative workload is the primary reason HR can’t make a more strategic contribution to the business.
That’s not a new complaint. It’s the same complaint, repeated across two decades of HR transformation initiatives, technology investments and conference keynotes promising a better future for the function. BCG’s 2026 Creating People Advantage report, which surveyed more than 7,000 HR and business leaders across 115 countries, puts fresh data points on a stubborn reality.
Peck Kem Low, HR Tech Asia speaker and a co-author of the report, wrote that: “Ultimately, companies measure the success of the HR function by the value it creates for the business, not the volume of activity it delivers.”
Yet, 51% of those same leaders say admin load is what’s actually blocking HR from getting there.
Here are five reasons that the gap won’t close.
Technology gets implemented, not redesigned
Most HR technology investments layer digital tools onto existing processes rather than rebuild those processes from scratch. The result is faster administration, not less of it. BCG’s data found that only a small share of organizations translate digital solutions into sustained business value. This finding points to implementation depth, not tool selection, as the core issue.
Governance fills the vacuum
When HR isn’t anchored to clear business priorities, compliance and employee relations tend to fill the available capacity. These are necessary functions, and BCG’s data shows organizations remain strongest in exactly these areas. But strength in foundational topics doesn’t create room for strategic work.
Read more: How CHROs are making AI stick
Analytics capability hasn’t kept pace
Organizations have spent heavily on HR systems. Fewer have built the skills or data culture to turn those systems into decision support. BCG describes this as a deficit in digital fluency and analytics maturity, a gap between owning the infrastructure and knowing what to do with it. In this environment, reporting stays manual and lacks deep insights.
Skills-based operating models are still rare
Only 11% of companies in BCG’s sample have a full enterprise skills taxonomy. Without a clear picture of what the workforce can do, HR defaults to reactive hiring and ad hoc development rather than proactive planning. That reactive posture generates administrative volume that stacks up as more requisitions, more one-off requests and more coordination work that compounds over time.
Change management gets skipped
Transformation initiatives tend to focus on deploying new tools or restructuring the HR operating model. What gets less attention is the behavioral and cultural change required to make those structures stick.
BCG’s research points to the need for embedding new ways of working into performance management, leadership development and planning cycles. Without that, teams revert to old processes that outlast new systems.
“HR needs to move faster in terms of implementing digital technology, both within the HR function and driving the people elements of digital transformation across the business,” said Philipp Kolo, a BCG partner and director and a co-author of the report.
“HR can make or break business performance in the AI era,” wrote Kolo. “CHROs must meet the moment to embrace what could—and should—be a golden era for HR.”
Peck Kem Low, co-author of BCG’s 2026 Creating People Advantage report, will take the stage at HR Tech Asia in Singapore on May 5-6 for a CHRO panel on how the rules of enterprise are being rewritten. If the report’s findings sparked questions, this is where to bring them. Register here.
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