HR at a crossroads

Despite years of discussion about HR "earning a seat at the table," many HR leaders still find themselves regarded more as collaborators than as equal partners in the C-suite. New research from a global survey conducted by SAP and Oxford Economics reveals that 42% of C-suite executives still do not view HR as an equal partner and 36% of leaders see HR as only slightly critical to business strategy. This highlights a persistent gap in how HR’s strategic potential is perceived. While HR is regarded as essential for talent operations, it is still often underestimated as a source of strategic value.

Although those figures may seem discouraging at first glance, this perception gap presents HR leaders with a valuable opportunity to redefine their role and demonstrate HR’s relevance at the highest levels of business strategy. A majority of C-suite leaders believe the HR partnership is moving in a positive direction—47% say it is improving, and 70% believe their function would benefit more than HR would from strengthening the relationship.¹ It is a pivotal moment for HR teams to transition from being functional experts to strategic powerhouses.

Continue reading to explore strategies for leveraging the latest technology to position HR as a strategic business driver—through improved data integration, AI leadership, and cross-functional collaboration.

HR’s current status: Vital, but not yet equal

In the survey, C-suite executives overwhelmingly acknowledge HR's essential role in recruitment, retention, employee development, and culture.¹ These are the fundamental functions that drive engagement and productivity. But strategic influence is still a work in progress.

The distinction lies in how executives perceive HR:

• Vital, yet operational: HR keeps the workforce functioning.
• Collaborative, but peripheral: HR is consulted on strategy, but is not a partner in developing it.
• Well-liked, but under-utilised: HR’s potential impact is acknowledged but not fully realised.

HR leaders agree: they likewise currently see themselves as essential to fundamental talent operations but find it challenging to position HR as an equal strategic business partner in the C-suite.

If HR is to become a true strategic partner, it must align its workforce priorities with business priorities—and support those connections with data.

Data integration: The first step towards strategic influence

One key finding from the research—and one clear opportunity for HR teams—focused on the link between workforce data and strategic decision-making.

Only 38% of C-suite leaders are satisfied with their current integration of HR and business performance data.¹ Yet those who have achieved integration report significant benefits, from improved recruitment to better retention and cost savings through automation.

Workforce data can unlock strategic value when it:

• Forecasts skills gaps before they affect business performance
• Enables more intelligent decisions on compensation and talent development
• Links employee performance to business results

These capabilities are essential for HR teams in growing organisations that require their HR systems to scale in line with business complexity.

By delivering these insights, HR demonstrates its ability to influence outcomes beyond talent management—building credibility and securing a more strategic role in enterprise planning, investment, and long-term decision-making.

AI as a catalyst for HR’s strategic role

The survey also emphasised HR’s crucial role in driving enterprise AI transformation.

AI adoption is reshaping how companies operate—and HR is central to its success. 92% of executives say HR plays a vital role in implementing AI tools across the workforce¹.

Based on empirical research, SAP’s report identifies five critical areas where HR can drive successful enterprise AI adoption—transforming workforce change into business value:

• Training staff to use new AI tools with confidence
• Identifying change champions to support team-level roll-out
• Trialling new tools and gathering employee feedback
• Providing ongoing support to encourage adoption
• Modelling behaviour from leadership down

These roles make HR not just an enabler of AI transformation, but a steward of responsible, inclusive implementation.

Cross-functional collaboration: Speak their language

A final insight from the research explored HR’s alignment—or, at times, lack thereof—with other business leaders.

SAP’s research reveals that HR has the lowest alignment with other C-suite functions in terms of shared business priorities¹. While HR prioritises engagement, recruitment, and leadership development, their C-suite peers focus on financial performance, innovation, and growth.

That diversity is not a flaw—it’s a strategic asset. But HR needs to present its contributions in ways that matter to colleagues, such as:

• Linking leadership development to business continuity
• Presenting retention as risk mitigation
• Demonstrating how engagement metrics correlate with customer satisfaction and revenue

The key: represent HR’s workforce priorities in the context of the business’s priorities—and speak in the language of value.

A model for strategic partnership: HR and the EV transition

One real-world example: a CHRO partnered with a cross-functional team to launch a new fleet of electric vehicles (EVs). Their success arose from:

• Linking investment to operational outcomes with robust data
• Partnering with IT and Operations to support system rollout
• Championing workforce needs by developing training programmes

This collaborative effort led to measurable business value—including enhanced sustainability outcomes, improved workforce readiness, and stronger operational alignment between HR and the wider organisation.

This is what strategic partnership looks like: shared goals, data-driven decisions, and people-first execution.

What this means for HR leaders

To truly elevate HR in the C-suite, HR leaders do not need to abandon their core mission. They need to:

• Present HR data alongside business performance metrics
• Take the lead in responsible AI adoption
• Join and shape cross-functional initiatives

These strategies reflect what SAP’s HCM solutions enable today: integrated systems, personalised employee experiences, and flexible platforms that scale with growth.

Whether you are preparing for digital transformation, responding to economic change, or simply growing rapidly—now is the time for HR to lead, not follow.