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Human resources (HR) technology may be seen as one of the least glamorous parts of the digital technology revolution sweeping businesses, but its deployment is opening doors for companies to invest in digital technology across the rest of their business.
Business leaders said this week that, in many cases, HR was often ahead of other parts of their operations – including IT departments – in taking advantage of digital technology and agile ways of working.
Helen Jackson-Wright, head of HR services at Vodafone Group, said the company’s human resources modernisation project had placed the HR team in the vanguard of other parts of the business with its deployment of leading-edge technology.
The company, which employs 100,000 people in 26 countries, has created a central HR IT system, as part of a wide-scale deployment of SAP technology, including the in-memory database, Hana, SAP’s online marketplace software Ariba, and SAP’s SuccessFactors HR technology.
The company’s HR teams are working more closely with IT specialists and now have a “seat at the table” when it comes to discussing Vodafone’s technology strategy, she said.
“We are finding that HR is leading the way, even with technology moving into the cloud. We are really setting the standard and moving forward, probably a lot faster, with cloud than some of the internal IT organisations,” Jackson-Wright told an audience of IT and HR professionals.
Employees are demanding better technology
Speaking at an industry conference, Jackson-Wright said companies need to give their employees access to technology that is as good and as easy to use as the technology they use at home.
“Our employees are demanding change. And as long as we look at the end-to-end employee experience, look at the total journey and make sure the change is intuitive, our employees adopt the change really quickly,” she said.
Moving HR to a cloud-based service has allowed Vodafone to become more agile in its approach to IT, with more frequent software upgrades becoming the norm.
The technology team has had to adapt from a nine-month schedule for upgrading SAP’s software to quarterly updates on the company’s cloud HR service.
“Our people are pushing us to be more digital in the workplace than we are, because the technology they are using in their day-to-day life is quite often more advanced than we can bring”
Astrid Fontaine, Bentley Motors
That has led to new demands on the IT department. There have been difficult conversations with IT staff, for example, over the mandatory nature of the upgrades on SAP’s HR cloud platform, Employee Central.
“We find those times of one change, one upgrade a year are gone. And as we roll out each module of SuccessFactors, we take the opportunity to really adopt agile, so then we can drop change after change after change,” she said.
Improving the experience of employees
That means understanding how employees interact with the company, understanding their needs and personal preferences, and giving them the flexibility to decide how they want to interact with the company.
The Crewe-based company employs 5,000 people, who produce 11,000 luxury cars a year.
“Our people are pushing us to be more digital in the workplace than we are, because the technology they are using in their day-to-day life is quite often more advanced than we can bring,” she said.
Companies often do not give enough credit to how digitally savvy their workforce are and how adaptable they are to new ways of working, she said.
“Digital transformation is taking place not only in the workplace, it is a major part of life. If you look at our private way of life – how we shop, how we communicate – all of that has changed,” said Fontaine.
Bentley’s investment in SAP’s SuccessFactors HR technology, will give employees the freedom to enrol in e-learning courses when they need to, she said.
Meanwhile, managers will be able to use recruiting tools, which are capable of downloading data from social media, to help them find the right candidates to fill vacancies.
They will be able to use keyword searches to get the data they need in hours, and see the results on their mobile phones.
“That is the new HR. And that is the way we want to operate. That is what we want to give managers. Ease, simplicity and speed,” she said.
Pharmaceuticals company Teva has seen a different cultural change, after replacing a multitude of HR technology systems with a single company-wide suite of software.
Managers are now taking responsibility for the accuracy of the data on their own teams rather than leaving it to HR.
“If the data is wrong, you have to fix it yourselves. There is no one to blame any more. You can’t say, ‘HR, you know your numbers are all wrong’. It’s your data, go ahead and take ownership. That was a big thing for us,” said Anat Markus, Teva’s senior vice-president of global HR operations and services.
Bertelsmann’s mission to persuade
Bertelsmann, the German media and education services company, also a user of SAP’s SuccessFactors HR technology, is highly decentralised. It employs 119,000 people in 80 countries, in sectors ranging from TV to music to book publishing.
Kai Wehmeyer, senior vice-president of corporate HR strategy and systems at Bertelsmann SE & Co, has a mission to persuade hundreds of companies in the group to standardise on SAP’s SuccessFactor HR software.
Two years ago, Wehmeyer was given the chance to create a business case to upgrade HR operations across the company. He focused on the transformative impact that HR technology could have over the long term.
“We built that case and now we are halfway through the programme. We have had quite good success, I would say. We see very good traction and things start to move in the way we intend,” he said.
“[When upgrading HR systems], you need to be patient, you need to be resilient. You need tenacity as well. And if you don’t have that, and you don’t add passion, you should not start such a programme”
Kai Wehmeyer, Bertelsmann SE & Co
Persuading companies in the group to update their HR systems is not always easy. The HR team experiences resistance from some that prefer to stick with their existing ways of working.
“You need to be patient, you need to be resilient. You need tenacity as well. And if you don’t have that, and you don’t add passion to that as well, you should not start such a programme,” said Wehmeyer.
It’s a different approach from a standard HR IT roll-out. It’s harder to plan, and it takes a long time.
“We give some [parts of the group] more time to adjust and work on their process, while we accelerate others and bring them on more quickly because they are willing to change,” he said.
But Wehmeyer has found that those parts of the organisation that have taken up SuccessFactors earlier are starting to ask for Bertelsmann to add more HR functions to the system.
This has meant that the HR team has had to juggle its plan to harmonise HR IT systems across the organisation with meeting the demands for innovation from other units in the business – a concept Wehmeyer refers to as “constructive scope creep”.
“We have to keep harmonising processes, rolling new companies into our global template, but at the same time we have to be innovative and create new use cases and new tools we did not think of in our original business case,” he said.
One unexpected spin-off is that some of the technologies deployed by the HR team are now finding applications in other parts of the business.
Wehmeyer has seen a rapid take-up, for example, of collaboration platform SAP Jam, which the HR team decided to make available to any part of the organisation that wanted to use it. That includes the IT department, which plans to use SAP Jam to run a global IT community.
“We have all kinds of groups coming to us to jump on SAP Jam. There is no other tool that is secure that they could use for cross-organisational cooperation,” he said.
Exposing HR secrets to the outside world
Moving to a modern HR IT system means handing control of HR data to employees and managers, and that can mean major changes for the HR team.
In particular, saidVodafone’s Jackson-Wright, HR teams have to start speaking in a language that makes sense to regular employees.
“Your bonus scheme for enterprise sales might be called ERT12. No one knows what that means. You have to start calling them sensible words that a human can understand,” she said.
Bertelsmann’s Wehmeyer agreed: “You are taking all the HR practices out of the black box. Like the secret science of HR.”
The company’s move towards a single HR technology means human resources and other parts of the business are now able to cooperate and understand each other more effectively, he said.
In the future, the development of digital assistants that are capable of learning and understanding what managers are looking for will make it easier for general managers to make HR decisions, said Teva’s Markus.
Why HR IT transformations needs new skills
Transforming HR has also meant companies are having to hire people with new skills. For Jackson-Wright, it has meant finding people with the skills to design what she calls “user journeys”, rather than HR processes.
“Instead of just doing a process from start to finish, it has been designing the employee experience from end-to-end, which has been really difficult,” she said.
The company has also invested in re-training its SAP technology team in the skills needed for SAP’s Employee Central cloud HR service. It offered anyone in the company the opportunity to take a certificate in Employee Central, and had around 30 takers.
“You can’t buy SuccessFactors skills in the market very easily, so we have had to develop those skills we did not have and we are growing them. That has been quite a challenge,” said Jackson-Wright.
Bertelsmann’s Wehmeyer said the company has had to hire new people who understand data quality and controls to assist with its HR IT transformation.
The company has also identified a need for “engagement managers” to talk to businesses in the group about HR technology. It has created advisory boards and panels to bring people together internally to discuss new requirements for HR technology.
How to develop a business case for HR IT
For Vodafone, the business case for upgrading its HR system was more about improving the experience of employees than improving the bottom line. The company took into account the total cost of ownership of its HR IT systems – its spending on HR, IT and administration.
“We looked at making the numbers work, but what we were really focusing on was the user experience and the realisation that the technology we had today was not going to get us any further,” said Jackson-Wright.
Vodafone had made the switch to a single IT platform a few years ago, so it did not expect to see the “big dollar” savings from replacing its legacy IT systems that other companies might see when they first move to a single HR IT platform.
The company is now extending its HR technology to employees of partners that do not work directly for Vodafone. It is using SAP’s Fieldglass software to manage the HR data of temporary and contract workers.
By integrating Fieldglass and Employee Central on a single SAP cloud service, the company is able to see a complete picture of its employees, both on the payroll and contract workers.
It is using its HR platform to make online training programmes in compliance available to its business partners, a total of 200,000 people on top of the 100,000 that work directly for Vodafone.
Lowering the cost of HR services
Teva Pharmaceutical Industries, which employs 50,000 people across 60 countries, lays claim to be the largest generic drugs manufacturer in the world.
Moving to a cloud-based HR system allowed Teva to restructure the company following a difficult few years in the pharmaceutical market and a change of CEO and the executive leadership team last year.
The restructuring programme meant a big reduction in the number of employees and the need to close and consolidate manufacturing sites. HR data played a key role in informing managers, and helping them make the right decisions, said Markus.
Managers were able to see how long each employee had been with the company, their performance record and their employment history.
“They could make a decision based on everything we know about our employees, to ensure that we are separating in the most honourable way from people who we need to separate from. And we also needed to make sure we keep the best talent for the future, and keep them engaged and happy and successful,” she said.
Teva was also able to cut its HR costs by replacing local HR operations with two shared HR service centres in countries with a lower cost base.
“Having the same processes for all employees in one system meant we were able to do that. We saved a lot of money by moving [HR services] from high-cost countries to lower-cost countries,” she said
Small improvements in HR led to big savings
Bertelsmann is decentralised, so the company found it difficult to calculate the costs of its existing HR IT systems when it considered the business case for replacing its HR IT.
But it concluded that making a few small improvements and applying the changes at scale across the whole of the group would add up to significant savings.
“We calculated a long list of 30 benefit categories and we just offered them to our executive board,” said Wehmeyer. “We said we don’t have to believe all of these, but if you can take four or five that you think you can achieve, that is already enough to make the business case.”
Advice for HR IT transformations
With a major project behind her, Vodafone’s Jackson-Wright urges companies embarking on HR IT transformations to think beyond HR technology and to involve other departments in planning future IT needs.
This may make planning more difficult, but the benefits for employees and the long-term sustainability of the project will be 100% greater. “Otherwise, the risk is you get a nice chatbot from HR and a really nice one from IT, and the poor employee does not know where to go,” she said.
“Don’t look for perfection, look for progression. If you are looking for every perfect process or every perfect launch, you will be overwhelmed and you will not make progress”
Anat Markus, Teva Pharmaceutical Industries
Teva Pharmaceuticals’ Markus advises companies to press on with projects without becoming side-tracked if everything does not work out as intended. “Don’t look for perfection, look for progression. If you are looking for every perfect process or every perfect launch, you will be overwhelmed and either not go live at all, or keep delaying your go-lives, and you will not make progress,” she said.
For Bertelsmann’s Wehmeyer, it is important for companies not to consider HR IT projects in isolation. “The first thing is you need to take up a holistic perspective. Don’t look at the system only. Make a large change initiative of it,” he said.
He advises companies to draw on the resources of their own marketing teams – to understand how they interact with customers – and to use the same ideas to improve the way that employees can interact with HR. “Go to the marketing function, get their tools and ideas. Be brave, bring them into the HR process work,” he said.
But he warns that seeking approval from other parts of the business can be counter-productive. “Be brave, don’t ask for approval all the time. We did not always. If you ask everybody – IT, legal – you will never get anywhere. So just go out there, try some things,“ he said.
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