Global HR and the Next Act of Transformation
By Kathryn Perry on Sep 03, 2013
A Guest Post by Oracle's Bertrand Dussert (pictured left), who serves as HR transformation and technology advisor to Oracle's executive clients, primarly at large global companies with complex HR service delivery needs.
Over the past decade, well more than half of large organizations have rolled out some sort of HR transformation program. The exact number is closer to two thirds of the very largest global firms that have adopted some flavor of globalized / centralized HR service delivery and governance in that timeframe These efforts initially started with a desire to create scale and consistency in the HR function, as well as improve the overall economics of HR.
Many of these initiatives included the establishment of shared service capabilities that were either managed in house or outsourced to HRO providers. When fully implemented, a number of these initiatives delivered cost / transaction improvements of 15-20 percent, and sometimes, considerably more when manager and employee self-service tools were first leveraged.
Despite these apparent successes, many Chief HR Officers (CHROs) today will tell you their employee experiences don’t live up to their own customer experience standards. Placing the claimed efficiency gains in HR to the side, staff ratios for HR employees have persistently hovered in the 0.9 to 1.1 percent of total employees for the last 12 years. The needle has not moved on this front.
Indeed some of these efforts can be called partial successes where the scope of HR services increased and costs remained flat. However the drivers for excellence in HR have changed since the beginning of the current decade, and HR transformation is in need of its next act.
What Has Changed?
First, what is expected of HR has changed. RBL Group research shows that for the first time in the 20-year span of its study, HR is expected to serve as a technology proponent (not just a reluctant user). The business lines are saying this role is very important, yet they also recognize it is a weak spot for most HR functions.
Second, business demands have changed. Businesses that win are more frequently differentiated by agility and pace of innovation, and less by cost per transaction. (Cost of transaction is still a must, but is becoming table stakes).
Third, Moore’s Law and the massive increase in scale and diversity of people data-sets are creating an unprecedented opportunity to ask and answer better questions, as well as gain access to HCM predictions of improved quality.
So Where Should The Next Act Focus?
To make the HR transformation a meaningful one, we need to consider what to focus on and understand where we will most likely see the big wins. Here are three predictions we feel have some merit:
CX meets HR and the ‘consumerization’ of HR. The role of effective leadership teams is no longer to manage hierarchical employee teams, but instead to lead a hybrid talent ecosystem of value creation and delivery capability. That includes full-time employees across the company, part timers, alumni networks, contractors, temps, outsourcers, partners, alliances and more. Companies that win outperform others in their ability to create value across all of these groups.
With the advent of the modern consumer mindset also comes the expectation of customizable employment. This could mean more choices in benefit plans, but also extends to more work location flexibility, mobile enablement of corporate tools, and more autonomy to focus work effort where it has the biggest impact on the organization.
In summary, consumer grade HR is not one size fits all, and it demonstrates this through the deployment of context relevant communication, tools, processes and policies.
The role of the front-line manager, and how HR supports that role in particular, will change. The change will be based on the availability of consumer-grade technology delivered to any device (including mobile). In addition to having an intuitive ‘consumer grade’ user interface, these tools will support decision making for the manager.
This is where embedded analytics, delivered at the point of decision, can make a big difference. HCM predictions, scenario planning and ‘best recommended outcome’ functionality is getting closer to taking the place of the ubiquitous junior HR generalists that usually support front line managers.
This is one area where the Oracle HCM Cloud offerings truly shine. They simplify manager and employee self service to the point that no system training is required, and provide front-line managers with effective predictive tools around turnover and performance. Combined with scenario planning capabilities, this type of functionality can be a game changer for front-line people leaders, and the HR functions that support them.
The organization’s line of sight on HCM finally goes ‘Beyond Visual Range'. Workforce planning moves from being a project to an HR Center of Excellence. In parallel, workforce planning activities move beyond being distinct work-streams to address one-off questions, such as Where is the best place for a second city strategy to support the IT function? These activities become embedded in a number of other processes across the organization, such as corporate planning, real estate, recruitment, and learning and development.
At the same time, the technology evolves to model and predict talent and people outcomes on an aggregated level for the whole organization―not just individual or small group predictions.
This is another area where the workforce prediction capabilities in Oracle HCM Cloud really come to life. Beyond the work of the front-line manager, HR users can extend the planning horizon and partner with business leaders to better prepare their organization and talent bench to win in an era where highly adaptive and resilient companies win.
HR’s Second Act
If HR leaders manage to deliver on all three of the areas of focus above, while continuing to execute efficiently and reliably on all table stakes, they have a shot at moving the HR function from one that is often asked to react to corporate strategy, to one that can be a real part of shaping it. By accomplishing this, the next act of HR transformation can have an impact on much more than the HR function, but instead can at the core change the way organizations manage people.