hr transformation through hrbp - 2015 09 13

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Michael S. Foss September 13, 2015 [email protected] | 1 | Through my background in management consulting (Deloitte Consulting) and as a global practice leader within a Human Resources (HR) function of a multi-billion dollar global enterprise (Amway 1 ), I have developed a vision for transforming the entire HR function into a strategic business partner. 2 The opportunity is to build organizational capability and discipline in human capital strategy 3 & analytics and to institute HR Client Service teams; thereby, creating a sustained approach for how HR works with business areas to identify solutions and leverage their organization and talent in strategy execution. The HR function, not just the business partner role, offers the highest impact partnership role to business leaders through the disciplines of Organizational Effectiveness 4 and Strategic Workforce Planning 5 . To simplify this concept, the discipline of integrating the organizational and talent strategies into business planning can be referred to as “Human Capital Strategy”. Point being, the HR Business Partner (HRBP) cannot and should not be the lone business partnership role in HR’s service delivery. Rather, using the discipline of Human Capital Strategy HRBPs, HR Generalists, and Centers of Excellence (COEs) work as part of an HR Client Service team with distinct roles & responsibilities to plan-for and execute organizational and talent solutions aligned to business strategy execution. This HR Client Service Team approach positions the entire HR function into a business partnership role. The following sections provide a brief perspective on the value of this concept: I. Examples of Successfully Applying Human Capital Strategy at Amway II. Transform How the Entire HR Function Can Effectively Operate as a Strategic Business Partner III. Proof of Concept, Affecting Change at Amway IV. The Business Case for Human Capital Strategy I. Examples of Successfully Applying Human Capital Strategy at Amway Three cases of approaching business partnership through multiple disciplines from HR using human capital strategy: Utilized an organizational assessment framework to identify opportunity areas for consolidating Asia Pacific Regional Payroll net impact reduced 25% of Payroll FTEs in Malaysia (pilot country), with additional 50% reduction region wide Payroll consolidation was also identified as a critical next step in the enterprise adoption of the global SuccessFactors Employee Central implementation Adapted the strategic workforce planning methodology to support the development of California’s Manufacturing operational long-range strategy by doing so, the Manufacturing leaders and HR created three staged scenarios demonstrating progressive improvements to operational KPIs by shifting how work is organized and sourced (internal versus contract labor); stage one was approved and is in execution Applied the organizational effectiveness methodology to determine future staffing size of the China Region’s Shop (retail) operations (60% of total regional headcount, serve 40% of enterprise revenue) net result reduced budgeted Shop staff levels by 17% through 2016 while sustaining focus on critical customer interfacing activities 1 Amway (a.k.a. Alticor Inc.), a USD $11bn fast moving consumer goods manufacturer and direct selling company operating in over 100 countries with 21,000+ employees 2 Michael Foss presented “Driving Human Capital Strategy with the HRBP” at an Institute for Corporate Productivity (i4cp) Exchange. August 2015, and presented "Building a New HCP Practice" at the Talent Management Alliance's "Workforce Planning Conference". Las Vegas, Nevada. June 2014 3 Strategy “A business strategy is a set of guiding principles that, when communicated and adopted by an organization, generates a desired pattern of decision making.” Watkins, Michael. Harvard Business Review, “Demystifying Strategy: The What, Who, How, and Why”. September 10, 2007. 4 Organizational Effectiveness aligning organizational components (e.g., goals & measures, processes, governance, design) to business strategy execution 5 Strategic Workforce Planning aligning talent management activities in order to have the right people, in the right place, at the right time, for the right price

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Michael S. Foss September 13, 2015

[email protected]

| 1 |

Through my background in management consulting (Deloitte Consulting) and as a global practice leader within a Human

Resources (HR) function of a multi-billion dollar global enterprise (Amway1), I have developed a vision for transforming the

entire HR function into a strategic business partner.2 The opportunity is to build organizational capability and discipline in

human capital strategy3 & analytics and to institute HR Client Service teams; thereby, creating a sustained approach for how

HR works with business areas to identify solutions and leverage their organization and talent in strategy execution.

The HR function, not just the business partner role, offers the highest impact partnership role to business leaders through the

disciplines of Organizational Effectiveness4 and Strategic Workforce Planning5. To simplify this concept, the discipline of

integrating the organizational and talent strategies into business planning can be referred to as “Human Capital Strategy”.

Point being, the HR Business Partner (HRBP) cannot and should not be the lone business partnership role in HR’s service

delivery. Rather, using the discipline of Human Capital Strategy — HRBPs, HR Generalists, and Centers of Excellence

(COEs) work as part of an HR Client Service team with distinct roles & responsibilities to plan-for and execute

organizational and talent solutions aligned to business strategy execution. This HR Client Service Team approach positions

the entire HR function into a business partnership role.

The following sections provide a brief perspective on the value of this concept:

I. Examples of Successfully Applying Human Capital Strategy at Amway

II. Transform How the Entire HR Function Can Effectively Operate as a Strategic Business Partner

III. Proof of Concept, Affecting Change at Amway

IV. The Business Case for Human Capital Strategy

I. Examples of Successfully Applying Human Capital Strategy at Amway

Three cases of approaching business partnership through multiple disciplines from HR using human capital strategy:

Utilized an organizational assessment framework to identify opportunity areas for consolidating Asia Pacific

Regional Payroll – net impact reduced 25% of Payroll FTEs in Malaysia (pilot country), with additional 50%

reduction region wide – Payroll consolidation was also identified as a critical next step in the enterprise adoption of

the global SuccessFactors Employee Central implementation

Adapted the strategic workforce planning methodology to support the development of California’s Manufacturing

operational long-range strategy – by doing so, the Manufacturing leaders and HR created three staged scenarios

demonstrating progressive improvements to operational KPIs by shifting how work is organized and sourced

(internal versus contract labor); stage one was approved and is in execution

Applied the organizational effectiveness methodology to determine future staffing size of the China Region’s Shop

(retail) operations (60% of total regional headcount, serve 40% of enterprise revenue) – net result reduced budgeted

Shop staff levels by 17% through 2016 while sustaining focus on critical customer interfacing activities

1 Amway (a.k.a. Alticor Inc.), a USD $11bn fast moving consumer goods manufacturer and direct selling company operating in over 100 countries with

21,000+ employees 2 Michael Foss presented “Driving Human Capital Strategy with the HRBP” at an Institute for Corporate Productivity (i4cp) Exchange. August 2015, and

presented "Building a New HCP Practice" at the Talent Management Alliance's "Workforce Planning Conference". Las Vegas, Nevada. June 2014

3 Strategy – “A business strategy is a set of guiding principles that, when communicated and adopted by an organization, generates a desired pattern of

decision making.” Watkins, Michael. Harvard Business Review, “Demystifying Strategy: The What, Who, How, and Why”. September 10, 2007.

4 Organizational Effectiveness – aligning organizational components (e.g., goals & measures, processes, governance, design) to business strategy execution

5 Strategic Workforce Planning – aligning talent management activities in order to have the right people, in the right place, at the right time, for the right price

Michael S. Foss September 13, 2015

[email protected]

| 2 |

II. Transform How the Entire HR Function Can Effectively Operate as a Strategic Business Partner

Two critical considerations for this HR transformation:

Institute an HR Client Services Team, internal human capital consulting capability, with roles focused on:

o Account Management (typically an HRBP) – partnering with business leaders (clients) on identifying

opportunities for human capital strategy and solutions

o Client Service Team (project team comprised of HRBP, HR Generalists, and COE members) –

development and execution of plans aligned to the business strategy

o Methods & Analytics Team (typically COEs) – development and configuration of organizational and talent

methodologies, tools, and analytics to be utilized by the Business Partner and Client Service Team

Engage the business areas in application of human capital solutions through the strategic business partner role —

this requires Business Partner skill development in stakeholder management, analytics, and storytelling to support

informed decision making regarding a business area’s human capital (organization and talent)

III. Proof of Concept, Affecting Change at Amway

Currently, I am building and leading a new Global Human Capital Strategy and Planning (HCP) Practice at Amway. The

HCP practice designs the strategic approach and develops HR Business Partner capabilities for advising business areas on

how organizational structure and talent improve execution of the business strategy.

Key organizational changes implemented to transform HR business partnership (client service):

Embedded a Human Capital Methods Team (HCP) within the HRBP Organization

Published methods and tools in Organizational Effectiveness, Workforce Planning, and Human Capital Analytics

Instituted HR Client Service Practice Teams focused on delivering HR programs, processes, and initiatives to

Amway’s business areas with clearly defined roles throughout the HR function

Developed HR Service Expectation & Partnership documents outlining what HR delivers to the business and the

roles & responsibilities regarding that delivery (similar to a service level agreement)

Designed four Regional Human Capital Planning sub-practices to support local configuration of tools, and to drive

strategic project delivery and business application

Michael S. Foss September 13, 2015

[email protected]

| 3 |

IV. The Business Case for Human Capital Strategy

Successful execution of business plans depends on the business’ people, processes, and technology –

effective utilization of “people” comes from a human capital strategy

Labor costs can be ≈ 60-70% of operating expenditures, with outside services and temporary labor comprising an

additional ≈ 10-20% — all of which are an outcome of a business’ human capital strategy

HR programs should be managed as a portfolio of solutions oriented to supporting business strategy execution,

opposed to a set of discrete practices business areas must comply with on a periodic basis

When done well, human capital strategy has two business applications.

Developing HR’s organizational capability in human capital strategy will transform how the HR function partners with the

business. I welcome the opportunity to network and discuss experiences and observations regarding human capital strategy

and analytics with others currently building this capability or exploring the concept further.

All the best,

Michael

[email protected]

Two Applications

Business Strategy

HR Strategy

Directly contribute to business strategy execution

through human capital-based solutions

Prioritize and rationalize HR investment related to

business objectives

Near-term: Support the business areas in

efficiently managing their operating

expenditures and resources

Long-range: Create a high-performing

organizational environment and a sustainable

pipeline of talent

Near-term: Prioritize and coordinate HR

service to fit business needs (use what exists)

Long-range: Drive business context into HR

program and strategy design (evolve HR

service delivery)

1. 2.