hr transformation: prizes and challenges transformation-peter reilly.pdf · institute for...

Institute for Employment Studies 1

the institute for employment studies

HR Transformation:prizes and challenges

Peter ReillyDirector HR Research and Consultancy

Agenda

What is HR transformation?What prizes does it bring?What challenges need to be met?The available solutions


HR Transformation


Dimensions of HR transformation

Automation

ConsolidationStandardisation

What’s involved in automation

Integrated records(and payroll) systemsBetter MIInformation through intranetSelf service

Stand alone e-systemsDocument management & work flow

What’s involved in standardisation

Re-engineering processesTo exit, transfer & simplifyUsing best practice to ensure quality and consistencyAllowing internal and external benchmarkingTo obtain standard ● systems?● processes?● polices?


What’s involved in consolidation(and other structural change)

Bringing together dispersed activities into single organisation

Aim is to share services for common good

Focuses on transactional and informational

Can allow business embedded HR to flourish independently& specialist expertise to grow

Corporate centre

Businesspartners

Centres ofexpertise

Sharedservices

Plus …

New relationships with stakeholders● CEO● Employees● Line Managers

New purpose and roleNew content● CSR● OD● Branding …

Drivers of transformation

Cost reduction

Improved service standards

More business focus

Increased customer sensitivity

Greater added value

Repositioning function away from administration towards strategy


cont

ribu

tion

strategic

tacticaltime orientationshort long

strategist/integrator

administrator/controller

adviser/consultant

Repositioning HR

A corporate example

Shaping,creatingimpact

Functionallyeffective

Processefficient

HR focus and capability

timeTransactiondominated

General drivers of transformation

Cost reductionImproved service standardsMore business focusIncreased customer sensitivityGreater added valueRepositioning function away from administration towards strategy(segmenting & balancing transformational & transactional)

Following the lead of other functions


What drives consolidation, standardisation & automation

Strategy structure

Strategic positioning

Improveservices

Cut costs

processes

Consistency

Financial savings

Credibility

Benchmarking

systems

Cost

Commonality

Better MI

Integration

Facilitates devolution

Specific drivers


The prizes

So what are the prizes?

Within the function:Shift towards valued-added work


Activity shift (company example)

Key: Strategy, administrative, advice and delivery

60%

30%

10%

20%

20%

60%

OriginalHR

After sharedservices

After selfservice


Within the function:Shift towards valued added workImproved, faster processesLower costsBetter customer feedbackSeen as a valued contributor People management on the map

Specific benefits

Strategy structure

Service quality

HR repositioning

Business focus

HR issues more on agenda

Deeper expertise

processes

Service quality

Good practice

Better benchmarking

Cost savings

systems

Faster service

Cost reduction

Greater consistency

What benefits from consolidation, standardisation & automation



Within the function:Shift towards valued added workImproved, faster processesLower costsBetter customer feedbackSeen as valued adviserPeople management on the map

For the organisation as a wholeSuperior performance through people

Performance through people

Higher productivity

Better attendance

Lower attrition

Better service delivery

Higher quality

Reduced costs

Improved organisational functioning

Aligned culture & organisational values


The challenges


Customers not always happy!

‘Business partners promise the earth because they leave someone else to deliver’

‘Business partners need to get out more’

‘Is HR up for it, as well asup to it?’

HR policies good in theory but difficult to implement

HR is insufficiently in touch with business

HR unduly constrains line

HR is unresponsive

and slowHR ‘quality varies from superb

to one wonders how they managed to find

their way to work!’

Challenges with service delivery

Problems with● Structures● Systems● Processes

What problems faced?

Segmentation:● boundary management● poor communication and learning● unclear accountability● role ambiguity

Service model:● over promising, under delivering● customer complaints● no recognition of customer differences● multiple delivery channels ● service gaps - the ‘Polo’ problem


The ‘polo’ problem

Strategic

Operational

Administrative

Further problems

Technology● doesn’t work as promised ● self service insufficiently intuitive● accusations of dumping by line● tail wagging dog● over automation of processes

Standardisation● cultural/customer differences ignored● centralisation by another name

More challenges

HR resistance Customer rejectionChange management Distance from employeesFailure of devolution to line


Inhibitors to devolution

Source: CIPD research 2007

mean scores0 = not at all 1 = a fair amount 2 = a great deal

1.4

1.11

1.11

1.35

1.31

0.55

0.7

0.8

0.48

1.19

1.15

0 0.5 1 1.5

priorities

disposition

training

time

skills

restrictive HR processes

lack of role clarity

lack of mgt encouragement to devolve

reluctance to let go

poor employee self-service capability

poor manager self-service capability

Line manager issues

HR issues

Technology issues

More challenges

Change management HR resistanceCustomer rejectionDistance from employeesFailure of devolution to lineGetting message accepted of people as assetsBeing able to prove HR/people management contribution to organisational successLack of focus on key issues

Time v importance (the top 3 activities for HRDs)

Source: CIPD research 2007

52

5

36

26

71

30

28

38

14

5

9

49

9

37

49

64

16

58

0 10 20 30 40 50 60 70 80

HR administration

Updating own HR knowledge

Change management

Helping employees

Providing support to line managers

Providing specialist HR input

Developing HR strategy & policy

Implementing HR policies

Business strategy

Activity Area

Percentage (n=775) most time consuming most important


More challenges

HR resistanceCustomer rejectionChange management Distance from employeesFailure of devolution to lineGetting message accepted of people as assetsBeing able to prove HR/people management contribution to organisational successLack of focus on key issues

HR capability and career development

HR capability needs

CIPD research 20070 10 20 30 40 50 60

willingness to innovate

integrity

negotiating skills

business knowledge

ability to deliver to targets

strategic thinking

leadership skills

communication skills

understanding HR practices

influencing skills

Percentage of respondents (n=767)

Most important

Biggest Challenge

Does HR have the skills?

Most frequently listed competencies for successful international HR professionals in CIPD research:

Process skills• providing information

& advice• mobilising & engaging• balancing

Technical skills• compensation• training• resourcing etc.

Political skills• facilitating• cultural sensitivity• ambiguity tolerance• team working

Business skills• strategic thinking• business understanding


or these characteristics? (SHRM 4Cs model)

Susan Meisinger – The Future of HR Management

Is HR up for it?

What about personal attributes? ● like courage

Are there performance constraints?● Confidence to challenge● Motivation to improve● Flexibility to adapt● Determination to make an impact● Resilience …

Performance = potential ― interference

Traditional career structure

Personnel Assistant

Personnel Officer

Senior PersonnelOfficer

PersonnelManager

Graduaterecruitment

Admin.Recruitment


Worst case future HR career map

Corporate HR

Shared service

Business partnerCentres of expertise

transfers fromline management

external recruitment

external recruitment

outsourced


How to meet the challenges and overcome the problems

How do you do this?

Build a world class approach to HR


Building a world class HR model

Aligns &integrates with

the business

Proactivelyleads the

people agenda

Achieves desiredresults for

the business

Facilitatespeople

management

Gets thebasicsright

Supportspeople

management

IMPACT

World Class HR Practice

Createvalue

Addedvalue

Valuefor

money

Sustainableinnovation

Continuousimprove-

ment

Customer focus

How do you do this?

Build world class HR by:

Getting the basics right

● efficient processes and systems

Providing the operational support line managers need (not want)

Developing a suite of HR policies & practices that enables good people management/drive success

A service-driven model

Organisational leadership and culture

HR policies and practices

line management

employee behaviours

superiorperformance


How do you do this?

Build world class HR by:Getting the basics right● efficient processes and systems

Providing the operational support line managers need (not want)Developing a suite of HR policies & practices that enables good people management/drive success

Facilitate managers management of peopleOffer tools that help them in that roleSolve business (not HR) problems● focus on business critical issues

How do you do this? (2)

Develop a Human Capital modeland get it accepted by management

A broader human capital model

ability:skills,

trainingeducation

attitudes:engagementinvolvement

application:job designautonomy

access:resourcing

recruitmentsuccession

DeploymentDevelopment

Individual capability

Organisational actionTamkin et al, 2006, IES



Develop a Human Capital modeland get it accepted by management

Integrate HR and people management activities

Build social capital through knowledge sharing, networking and relationships

Anticipate change through horizon scanning & internal sensingPrepare the organisation for changeand deliver it successfully


Determine the optimal service delivery modeland make it work

What to do with automation & standardisation?

AutomationDon’t assume technology will work as plannedReturn to human interaction where:● efficient● sensitive

Customise to make systems intuitiveMake most of better MI by building analytical skills

StandardisationOnly standardise where real benefits● processes?● policies?● systems?

Maximise freedomfor management within limitsExploit advantages of transparency and simplicity


What to do with structures/roles?

Don’t ignore economies of scale● but join up the dots● plug the holes

Design jobs people can do and be clearer in role specificationand be more customer sensitive● give line more operational support ● differentiated service offering● think of the external client

Adjusting the 3 legged stool structure

Corporatecentre

Businesspartners

Centres ofexpertise

Sharedservices

Operational execution

Junior BusinessPartners

Assistants Assistants

Casemanagement

What to do with structures/roles?

Don’t ignore economies of scale● but join up the dots● plug the holes

Design jobs people can do and be clearer in role specificationand be more customer sensitive● give line more operational support ● differentiated service offering● think of the external client

Innovate in partnership working


Consider optimal method of service delivery: options on shared services

Integratedservice

provider

In-housecost

centre

In-houseprofitcentre

Wholly owned

subsidiary

Outsourcedto thirdparty

Jointventure

Ownership and control

Sharing solutions

Useof samestandardprocesses

Shared payroll records

Shared recruitment advertising

Providing specific training

Common service &

call centre

Frontend

sharing

Jointad hoc

solutions

Fullsharedservices

Sharedbackend

services

Commonprocesses


Determine the optimal service delivery modeland make it work

Build HR capability


What to do with skills

Reflect HR specific needs in any competency listTackle dispositionSkill up existing HR staff● training

● development

Bring in capabilityImprove career management processesLearn from other functions


Determine the optimal service delivery modeland make it workBuild HR capabilityDemonstrate HR effectiveness and efficiency● operational excellence● client service ● delivery at lowest cost

● business impact

and measure it

Clarity over measurement

HRefficiency

PeopleManagementeffectiveness

People management

efficiency

HReffectiveness

IMPACT

OUTCOME


To sum up

Emphasis on structures and processes● necessary but not sufficient● basics often better than previously● function often more efficient than beforeAreas of improvement remain● capability of HR to deliver added value● across a wide range of content● getting message accepted of people as assets● being able to prove HR and

people management contribution

… thank you

For further information contact:www.employment-studies.co.ukpeter.reilly@employment-studies.co.uk

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