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HR technology heads to cloud in Finland
Computer Weekly talked to Finnish experts about Finnish enterprises moving to cloud-based HR IT systems
Organisations in Finland have been fast adopters of cloud services, and for human resources (HR) in particular.
They are moving to cloud-based HR IT systems to improve usability and mobility and give employees more power over their HR data.
Mika Rajamäki, principal research analyst at Gartner Finland, said HR has become one of the fastest-growing sectors of cloud adoption for busineses, with Finland clearly taking notice. “Almost half of Finnish organisations [now] use cloud-based HR systems, at least to some extent,” he said.
One example is food and confectionery manufacturer Fazer. The 125-year-old company, which has more than 15,000 employees across the Nordics, the Baltics and Russia, decided to move from several outdated HR solutions to SaaS operator Workday in 2012. The system was rolled out in Finland two years ago and is now being deployed across Fazer’s other markets.
“Before this we didn’t have a unified HR system,” said Mika Videman, senior VP of human resources at Fazer. “Instead every country had its own not very advanced system. One of the biggest criteria for choosing the new HR information systems was that it wouldn’t be a system for HR, but for our managers. This made usability a major factor.”
Fazer uses Workday for core HR data, performance management and compensation data, and integrates it with local payroll systems. Videman said one the main benefits of changing to a cloud system is its mobile-friendliness, which makes HR data more accessible for people outside HR.
“Managers need to be able to access real-time, accurate data wherever and whenever they need, instead of calling HR to ask, for example, how much team members are paid,” Videman said.
The Outotec experience
It was a similar experience for Riikka Kämäräinen, delivery service manager at Finnish multinational engineering company Outotec. Back in 2011 the company was looking to improve the user-friendliness of its HR systems and implemented a hybrid model where master data resides in SAP HR, but other HR tools come from SuccessFactors (owned by SAP) and its cloud-based HR management suite.
Outotec first adopted SuccessFactors for basic employee profiles and performance management and has subsequently added compensation, learning and development management modules. The new system has been of particular value in harmonising payment processes across 27 countries, but Kämäräinen also highlights the usability improvements.
“A clear benefit has been that we don’t have to worry about the hardware, unlike, for example, with SAP,” she said. “Also, if somebody finds a bug in SuccessFactors and it’s fixed, then the fix will automatically update for all its customers.”
While the trend towards cloud-based HR services is a global one, Finnish HR leaders seem to have a particular focus on technology. A Human Capital Trends 2015 study from professional services firm Deloitte found that Finnish respondents rated HR technology, people analytics and simplification of work as of most value. In fact, 74% of the Finnish respondents said HR technology was important or very important.
By contrast, the global trend list was topped by leadership, work culture and engagement as well as learning and development.
Eva Tuominen, director of HR transformation at Deloitte Finland, said although the study had only 35 Finnish respondents it did mirror attitudes in an engineering-oriented country. She gave a few reasons for the technology focus.
First, Finnish companies have started to recognise that traditional HR systems do not always align with the growing focus on personnel and the ability to attract talent as major competitive factors. Second, Finland has a strong tradition as an SAP-oriented country, and in many companies existing HR systems are reaching the end of their lifecycle.
“SAP HR has a very strong position in Finland and after SAP acquired SuccessFactors [in 2011] most Finnish companies have been forced to rethink their HR technology roadmap,” Tuominen explained. “They have either done this in the past few years or are now starting their re-evaluation.”
According to Tuominen, SuccessFactors is one of the big three cloud-based HR management services dominating the market in Finland, alongside Workday and Oracle.
Read more about HR in the cloud
- Opera Software has replaced its ageing enterprise resource planning (ERP) system with a cloud-based HR service in a bid to attract and retain the most talented staff.
- Talk Talk is, for the first time, providing its managers with accurate information on head count, job vacancies, overtime and salary costs after replacing seven HR IT systems with a single, cloud-based service.
- Finance company ING is using cloud-based software from ServiceNow to deliver HR services to its 25,000 staff in the Netherlands.
IT seeps into HR
The adoption of new technologies is also having a strong impact on day-to-day HR functions. As HR systems and tools get easier to use and require practically no coding experience, some of the tasks traditionally associated with IT are moving into HR’s domain.
Kämäräinen, who herself has experience in both HR and IT departments at Outotec, emphasised the changing demands for HR personnel. “For example, in SuccessFactors there are a lot of admin tasks, which have traditionally been something IT has configured, but now that is done by HR. HR needs people who understand HR processes, but who are also technically oriented.”
Videman at Fazer agreed that competences required from HR are changing, with system knowledge becoming a vital part of HR roles in Finland and abroad, but thought there are benefits in this. As Fazer has gained experience in running Workday, most configurations can now be done within HR, eliminating the need for external consultation.
“We have our own small team of Workday super-users and they don’t reside in IT, but in HR,” Videman said. “We have a good relationship with IT, but we strain them significantly less now than with the legacy HR systems. HR truly has ownership of this system.”
Many of the changes in HR today arise from personnel. There is a growing need to access data on the move, while new generations entering the job market expect to be able to use similar services and applications both at work and in their free time.
“All HR tools used by managers and employees should inherently be available on mobile, because the workforce today is mobile,” said Jukka-Pekka Heikkilä, researcher into entrepreneurship and e-HRM at Finland’s Aalto University.
His stance is backed up by a 2010 Eurofund study that found 45% of Finnish workers are so-called ‘e-nomads’: workers who use ICT for work and do at least part of their work off the premises of their employer or their own businesses. If the study were to be repeated in 2016, this percentage would probably be even higher.
But this just the start. Big data, analytics, virtual reality, machine learning and other hot IT topics are all making their way into HR in Finland.
“It is already a reality that in big companies no one reads every job application any more – everything is scanned,” said Heikkilä. “In addition there is a lot of talk about virtual reality [VR]. In Finland employees are already training in a virtual environment wearing VR glasses, and this opens up new opportunities for training.”
Despite the rapid advances in technology, the consensus seems to be that technology is not an end in itself but a gateway to greater advances, which depend on the individual company and its personnel.
“This should be motivating for HR people,” said Videman. “We are moving away from manual typing and instead talking with business units and solving complex issues with them. In these hard times every function needs to be able to improve its efficiency and bring more added value.”
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