Standard Life Aberdeen, one of Europe’s largest asset management companies created last year following a merger of two Scottish finance companies, is turning to cloud human resources (HR) services to help it to knit together two organisations with different cultures.
Aberdeen Asset Management and insurer Standard Life joined together in August 2017 to create a company which now has managed assets of £610bn and offices in 46 countries.
The combined group aims to make cost savings of £250m over three years, after cutting an expected 800 jobs from its 9,000-strong workforce.
The group faces the challenge of uniting two organisations which have different approaches to pay and bonuses, working hours and the way they manage their staff.
One of the key planks of the merger is a project to move Standard Life and Aberdeen Asset Management’s employee data onto a single HR platform.
Nigel Rogers, global head of HR systems for Standard Life Aberdeen, said the group decided to standardise on the IT systems it already had, rather than introduce new technology.
“The overall remit was you had had to pick one company’s systems or the other. You could not bring in something new to both companies,” he told Computer Weekly.
A simple choice
Standard life was relying on ageing software – Oracle E-Business suite together with Oracle Fusion – to manage its workforce, while Aberdeen Asset Management had replaced its legacy HR systems with Workday’s cloud HR service and a learning management system from Cornerstone in March 2016.
“It was not difficult to decide which system to use,” said Rogers. “One of them [Workday] is a world-class cloud solution. The other one was on-premise, reaching the end of its life,” he said.
Nigel Rogers, Standard Life Aberdeen
The merged company prioritised moving Standard Life Investment’s business on to Workday first, as it had the closest fit to Aberdeen Asset Management, with the rest of Standard Life’s business to follow later.
Standard Life Aberdeen hired Veran, a specialist in HR and finance technology, as a systems implementer to manage the project. Veran had previously managed Aberdeen Asset Management’s HR upgrade.
Standard Life Aberdeen began transferring 3,000 people from Standard Life’s HR system to Workday in February 2018.
But the project had to be put on hold within a matter of months when the merged company sold Standard Life Assurance to Phoenix Group – a move that the IT team had not anticipated.
“It meant that a lot of the people we needed to talk to were unavailable, as 100% of their time was taken up with that work. So we had a four-month period when we could do very little,” said Rogers.
Ironing out differences
The company used the gap to bring forward a project to introduce standard terms and conditions for employees across the organisation – originally scheduled after the completion of the Workday project.
“We are trying to have the same number of working hours across the UK. Just in Aberdeen, we had people on anything from 30.5 to 40 hours. We are trying to get everyone on the same hours, and the same arrangements for flexi-time, those sorts of things,” he said.
At the same time, the company began working on ways to harmonise the HR process – which operates in very different ways in each part of the company – across the combined organisation.
Putting these processes in place first has delayed the Workday project but, ultimately, it will simplify the work, said Rogers.
“Rather than put in a new set of benefits, and a few months later get rid of half of them, we can just do it once. It makes more sense and means less duplication”
Nigel Rogers, Standard Life Aberdeen
“Rather than put in a new set of benefits, and a few months later get rid of half of them, we can just do it once. As a programme of work, it makes more sense and it means less duplication,” he said.
The company aims to consult its employees in December or January over its proposals to harmonise benefits across the company, after which it will resume the Workday project.
It plans to go live with its HR data from the former Standard Life part of the business in the third quarter of 2019.
The decision to delay moving all of Standard Life’s employees to Workday proved prescient in the light of the Phoenix deal.
“It was kind of the right decision, because we avoided trying to set up Workday for the insurance business – which was going to be sold anyway,” said Rogers.
Cutting admin pressures
Moving human resources data to a single platform will make it possible for the combined company to eliminate manual HR processes.
Line managers responsible for managing staff in both parts of the business currently have to log on to two different systems to carry out employee appraisals or approve holidays.
“There is a lot time being wasted on having to do things twice on different systems,” said Rogers.
Differences in the way data is stored between the systems can mean that normally straightforward tasks, such as producing a report of headcount across different groups in the organisation, are difficult.
HR staff face similar problems when they want to calculate total compensation across the company.
Standard Life Aberdeen expects to make significant time savings by giving managers the ability to make one-off bonus payments to employees directly, rather than push the request through the HR department.
The group has simplified the project by keeping customisation of Workday to a minimum.
“We have an overarching agreement of taking what we have, if at all possible, unless there is some reason we can’t use it, or it just does not work,” he said.
One of the biggest challenges is to transfer the HR data from Oracle’s e-biz software to Workday. Veran is running a project to evaluate and cleanse the data and to convert it for Workday. This will include checking the data for each employee to make sure it is internally consistent.
Standard Life Aberdeen has hired a partner, Kainos, to load the data onto Workday.
“There is a decision about what data we want to take over. What is essential is data for live operations, and then for historical data, things like salary history,” said Rogers.
Less critical historical data will be stored as “flat files”, either in the Workday software, which has the ability to store archives of historic information, or in another data storage platform, such as Microsoft’s SharePoint.
When the software goes live, Standard Life Aberdeen will ask employees to check their data and to fill in any gaps.
Standard Life Aberdeen plans to start deploying Workday’s planning software. It bought the company’s planning module at the beginning of 2018, and is interested in moving to Adaptive Insights, a more advanced planning tool acquired by Workday, in June 2019.
Among a range of other potential applications, the planning tool will allow the company to plan its headcount more effectively.
“One thing we want to do is headcount budgeting. We have done it in spreadsheets in the past. If we can do it in one place [on one software platform], it’s going to be much more consistent,” he said.
Rogers has plans to outsource the combined company’s payroll operations. For now, the Standard Life part of the business is running payroll on Oracle’s e-business suite, which is now owned by Phoenix, under a transitional service agreement.
Another project will move recruitment processes from each part of the combined group to Workday’s recruitment software.
Aberdeen Asset Management and Standard Life Asset management have been using recruitment software from different suppliers, neither of which were suitable for the combined business, said Rogers.
Advice for merging companies
Rogers advises companies going through similar mergers to think about the culture of both organisations before deploying HR software.
“What has made the project harder is change of scope with Phoenix, and deciding late on what terms and conditions would be harmonised,” he said.
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