Rolls-Royce cloud HR project will pay for itself in two years

HR IT director Mark Judd explains how engineering and aerospace firm swapped ageing ERP and spreadsheets for a company-wide core HR system

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A multi-million-pound project by Rolls-Royce to replace the HR systems used to manage more than 40,000 employees will pay for itself within two years, the company said today.

The Derby-based engineering and aerospace firm has swapped ageing ERP and spreadsheets used across 46 countries with a company-wide core HR system.

The project, which went live last October, will give Rolls-Royce new capabilities to plan for its future recruitment needs, and enable it to deploy existing skilled employees more effectively.

“We are talking about management of capability, deployment of right resource, the ability to deploy the right people when we need them and where we need them,” said Mark Judd, HR IT director, in an interview with Computer Weekly.

Rolls-Royce, which operates in 46 countries, made a strategic decision to move its HR technology to the cloud following a period of rapid expansion.

“As a business, our ability to ‘see’ the organisation that we were growing with a significant global footprint was inhibited by the underlying technology,” said Judd.

The company began evaluating cloud HR services in 2012.

Although Judd’s team considered some smaller providers, there were really only three technology companies that could support a company the size of Rolls-Royce – SuccessFactors, Workday and Oracle.

Taking soundings

The £14bn-a-year company took soundings with 25 large businesses that had already implemented big HR projects in the cloud, before selecting a supplier.

“Workday was more an outsider at that time,” said Judd. “When we heard the response from the market and the enthusiasm, and high level of excitement about Workday, it seemed right for us.”

Rolls-Royce signed a contract with Workday and hired consultants Deloitte to advise on the project – which became Rolls’ first company-wide cloud implementation – in mid-2014.

The company had previously relied on a SAP system to manage the HR records and payroll of the employees in its five largest territories, representing 85% of the workforce.

Smaller territories relied on a combination of smaller HR and payroll systems, and what Judd described as a “vast array” of spreadsheets and PowerPoint files.

As a result, it was difficult for managers to generate an accurate picture of the workforce world-wide, or to produce reports on the skills and talents of its employees, said Judd.

Software out of the box

The project team decided at an early stage to work with a standard implementation of Workday.

The plan was to keep variations in different regions to a minimum, unless there were good legal reasons to customise the software.

“We had a really strong design authority and we only made changes when we had approval from design authority,” said Judd. “It sounded authoritarian, but I think people embraced it enthusiastically.”

The HR team worked with other parts of the business to rethink the company’s HR processes. It was able to complete the work, and test the new processes in each geographic region, within five months.

“We liked the idea of going back to basics, and really challenging what we wanted to do with HR,” said Judd.

A team of more than 20 HR and IT staff from Rolls-Royce and a similar number of consultants from Deloitte rolled out Workday over 15 months, finally going live in October 2015.

Business benefits

Although it is still early days, Workday has given managers at Rolls-Royce a clearer picture of the organisation’s structure, and the skills, history and salaries of their teams, said Judd.

Managers can also use the software to set goals for employees and carry out performance reviews – a process that previously required them to access several different computer systems, then make a series of phone calls and send emails.

“That was a base line we needed to resolve,” said Judd. “It was amazing that we struggled with providing that capability [in the past].”

The new technology has also allowed Rolls-Royce to free its HR staff from administrative support work to focus on more strategic roles.

“Part of the value of the Workday solution was to get a very effective, sustainable technology in place that gave us visibility of our organisation in a way we had not been able to do before,” he said.

Project challenges

For Judd, linking Workday’s software into the company’s on-premise systems, and cleaning and transferring HR data into the cloud were significant challenges.

“We had to plug Workday into the environment we had, mapping data into on-premise systems and cloud systems,” he said. “Minor errors can have major implications if you don’t get that right.”

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Rather than phase in the project country by country, Judd took the risky decision to go live everywhere on the same day.

He said companies that have tried the phased route in the past have struggled to implement the same HR functions in each part of the business.

“Colleagues of mine who have gone down the phased route are still trying to get their businesses aligned two or three years later, and they are not able to deploy all the functions of Workday,” he added.

Future plans

Judd plans to spend the next 12 months “bedding in” the cloud HR service, and improving the company’s talent management and performance management processes.

Rolls-Royce is also collaborating with Workday to help it develop learning management software. The company currently uses SuccessFactors’ learning management technology.

“We are on the Workday learning design council and we are helping to define the future of learning solutions, and we are taking a view on other capabilities,” said Judd.

Mobile and analytics

In the longer term, Rolls-Royce plans to use data analytics to improve its training and development programmes.

“We are taking a look at competency information, and how that could drive decision-making in future, for example where we need to enhance capability through training and development, or acquire new business,” said Judd.

The company also plans to make Workday more widely available to employees to access from their mobile phones.

This should particularly appeal to the next generation of employees who expect to access information electronically.

“As an engineering company, giving [new recruits] a piece of paper is not an ideal introduction,” said Judd. “Having cloud on day one gives the right impression.”

Lessons learned

Judd advises other HR professionals to persuade executives to buy into cloud-based HR as an concept, rather than a technology.

“Get it across to your business that you are buying an idea, you are buying something that is changing all the time,” he said.

It also pays to invest in a well-thought-out integration strategy to make it easier to link cloud services to the existing IT infrastructure.

“It was a harder road that we would have liked, but we learned a lot from doing it,” said Judd. “For any company going into cloud anew, that is something to really focus on.”

It is also important to be uncompromising about observing Workday’s standard out–of-the-box configuration, said Judd.

“Workday is very flexible, but we wanted a single, simple design for everything,” he said. “I don’t regret that.”

Mark Judd was interviewed at HR Tech World in London.

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