global hr forum2008-reginald bull-achieving hr transformation through outsourcing
DESCRIPTION
TRANSCRIPT
Global HR Forum 2008Creative Talent for Global Collaboration
Stream B: Change in Global Environment and Corporate Strategies for Human Resources
Session 4: Evolution of HR Leadership
Achieving HR Transformation through outsourcing Achieving HR Transformation through outsourcing (Unilever case)(Unilever case)Reg BullReg BullCHO, LG ElectronicsCHO, LG Electronics
Scale and geographic reach
The Americas | €13.8bn | 36%
2007 Turnover €39.6 billion
Europe | €15.0bn | 38%
Asia/Africa | €10.9bn | 27%
Present in 150 countries
206,000 employees*
*as at end 2007
Our Peoplepersonal growth
team growthorganisation growth
HR Business Partnersoverall HR accountability
organisation & leadership capabilityculture
HR Servicesupport
transactionstechnology
HR Expertisesolutions
policies and systemsbest practice / knowledge
Policy interpretationProcess improvement
Individual, Team and Organisation Capability
Individual support and transactional enquiries
Solutions Development and activation
PerformanceCost / quality of service
The Ulrich ‘Business Partner, Expertise, and Service Delivery’ model
'Cheshire Puss….would you tell me, please, which way I ought to go from here?'
'That depends a good deal on where you want to get to,‘ said the Cat.
'I don't much care where --' said Alice.
'Then it doesn't matter which way you go,' said the Cat.
The shift ...The shift ...
Group As Is
Line Managers 1) Being served2) People Mgt deliveredfor them3) Internal single pointHR service
Employees 1) Dedicated inhouse HRservice2) Personalised attention
Retained HRemployees
1) Working in virtuallyindependent roles2) Serving business3) Internal interfaces
In Scoped HRemployees
1) Security of Unilever2) Opportunity to dodifferent HR roles
To Be
1) Self Service 2) Do some People Mgt actions themselves, with reverse SLAs 3) Interface with an external service provider 1) Self Service 2) Issue based interface
1) New interdependent HR Operating framework 2) Ensuring business is served 3) Regular external service provider interface 1) New Employer 2) Focus on core HR skills
Change
8
Sourcing Dimensions
• Scope– Process Scope– Geographic Scope– Languages– Desired Process Maturity
• Delivery Model– Delivery Style– Delivery Channels– Service Delivery Locations
• Resources– Use of Delivery Assets– In-scope People– Severance Approach– Retained People
• Change Approach– Transition Phasing Approach– Transformation Phasing Approach
• Technology– HRMS – PeopleSoft– Other Technology
• Relationship– Pricing Model– Reliance on Pricing Transparency– Desired Relationship with Provider– Desired Contract Term
MaximisingCost Savings ?
MaximisingOrganisational
Comfort
30% to 50% AnnualRun Rate Savings
10% to 20% AnnualRun Rate Savings
HR Information Solution 10%
Geographic Solution 5%
Operations Solution 15%
Service Provider
Experience 10%
Managing Risk 10%
Cultural Fit 5%
Governance Approach 5%
Pricing 20%Transition
Solution 10%
Transformation Solution 10%
SolutionPartnership
PriceImplementation
Risk
•Price has a ‘wild card’ effect – if the desired price is not achieved then the bid is unsuccessful
Why Accenture? The decision making process
In 2006, Unilever signed a 10 year global outsorucing deal with Accenture with a value of over US$1 billion. It remains the most comprehensive and largest deal ever in the history of HR BPO.
Country Classifications
OUTSOURCED SERVICE:
• The majority of Unilever employees will be served by this model
• Transactional and administrative work will be provided by Accenture through Regional Delivery Centres (RDCs)*
• Some high-touch work will remain local e.g. telephone interviews, candidate shortlisting, instructor led training for General Skills & Leadership curricula
IN-SOURCED SERVICE:
• Transactional and administrative work will be provided in-house by Unilever with support from Accenture
• Appointment of an Accenture Territory Manager to:
• Operationalise the Service Management Framework
• Advise on process and technology changes that could improve the Service Delivery Model
• Appointment of a Unilever Single Point of Contact (SPOC) to manage operational change in the HR organisation and to allow for a single point of escalation to the Territory Manager for retained HR (Business Partners/ Expertise Teams)
* An Accenture Shared Services location in a particular Unilever region providing HR services to Unilever employees
UNILEVER
Workforce
Line Mgmt
HRLeadership
BusinessLeaders
Former Employees
Integrated HR Information Systems
Regional Delivery Centre (HR SERVICES)
Transaction Support & Case Workers
HR Expertise TeamsHR Business Partners
Service Governance & Management
Res
ourc
ing
/Rec
ruiti
ng
Rew
ard/
Exit/
Wor
kfor
ce A
dmin
Perf
orm
ance
Customer Contact
Employee/Manager
Self-Service
Vendors
Call Centre
Mail/Fax
Empl
oyee
/Indu
stria
l Rel
atio
ns
& C
omm
unic
atio
ns
HRMS Management/ HR Reporting
3rd party management
Recruits
HR Transformation Projects
Lear
ning
RetainedPartially outsourced/ managed on a consulting basis
Outsourced
The HR Service Delivery Model illustrates how HR services are delivered to Unilever
The HR Service Delivery Model for Outsourced Model Countries
Payr
oll
So what about LGE? Design Principles for the HR Operating Framework
In order to facilitate the move towards true globalisation, these are the guiding design principles for the proposed HR organisation
• ‘One’ HR Team, accountable for ‘one’ HR portfolio
• Strong interdependency between Global Business units and the Regions
• HR Regional influence very significantly enhanced to reflect the reality that this is the operating environment where our people live and work. Company HR adjusted to this new reality.
•Similarly, Country HR must play a much larger gate-keeping role to limit unnecessary complexity raining-in to their location.
• Rigorous division of HR responsibilities within a clarified Business Partner, Expertise, and Service (enabling) structure
• Service delivery increasingly leveraged through global technology where this is feasible and cost effective
• Operating mindset to be: Customer/consumer focus (ease of use, timely, aligned); simplicity in all things; invent together; execute one-way-; do it once and do it right; harmonisation between units; concentrate on similarities – not differences; an ‘LGE’ mindset – not a ‘unit’ mindset.
• Clear, single global HR framework for structures, policies, and approaches with local (country) implementation that is powerfully co-ordinated by Companies and Regions
It is going to get tough, so we will need to be equally tough in response
HRRabbit
How important do you think the mindset of HR is in an implementation of this sort?