Getting Strategic with HR Technology

HR Technology Tools

Getting Strategic with HR Technology

Harold G. Ford IIIDresser & Associates, Inc.

Something everyone wants to talk about, HR Technology!I love tech, and HR Tech is my passion technology & building better tech strategies in companies

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Dresser & Associates, Inc.


Objectives

Current Trends in HR Technology

Getting Strategic with Technology

Building a Business Case for Technology

Current and trends in HR techHow HR Tech can make you more strategicWhy an ROI matters

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HRMG Solutions, Inc.


Who Is This Guy?

HR StrategistHR/Payroll Systems ExpertTrusted AdvisorSocial Media AdvocateSelf-Professed GeekEarly Adopter

17 years providing technology advice to HR/Payroll depts

Expert person who predicts the project will take the longest and cost the most

Use a smartphone? End of 2010, 1.2 billion people carry smartphonesUse GPS? Tweeted that they were here today?

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Terminology HR Technology

Acronym SoupSHRMCore DisciplineDavid Ulrich, University of MichiganPrimary HR Competency Domain

HRMS

HRIS

HCM

SaaS

ITM

ERP

WFM

Acronym soup daze and confuse, almost as much as HRBenefits admin, HR info mgmt, recruiting, training/learning mgmt, performance mgmt, payroll, work time

Core HR discipline by SHRM and is a facet of all other HR disciplines.

HR Guru David Ulrich HR Magazines Most influential HR person#1 management educator by Business WeekMastery of HR Technology as one of the five competency domains

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Terminology

S-word

Long-TermBig Picture ThinkingHolistic ViewCompany Goals/ObjectivesValue/Outcome Focused

HR must give value, or give notice. David Ulrich

Everyone talks about it, whos doing it? What does it even mean?

Term borrowed from military - having an impact outside your own military unit. Strategic taking a longer term, big picture approach. vs. Tactics

HRs Direct contribution to long-term corporate objectives.Understand all parts of organization, how organization fits together, and how any change will impact organization as a whole

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HR Technology Efficiencies

Efficiency

Yes, Technology can do all of these things to HR, but the real value lies in building better strategic vision.

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Strategic HR Technology

Enable HR - Make predictive correlations between traditional HR metrics and the businessMore holistic view of human capitalIMPACTS to business

Transform HR from tactical to strategicKnowledge EconomyWorkforce Agility

Make decisions about human capital to continuously improve and enhance the value of the business

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Trends in HR Technology

Web 2.0 Workforce MobilityEmployee Self ServiceTalent ManagementHR Analytics

5 Trends taken from a variety of sources: Watson Wyatt Research, SHRM, IHRIM, our customers

These 5 trends all incorporate a similar theme:Better strategic design, & HRs role in that strategyChanges in how employees work

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Trend #1 Web 2.0

Connecting with people Building CommunitiesCommunicating and Collaborating with your customers, employees, and peers to improve your brand.Provide Clarity and transparency about yourself & your company.Cultivating loyalty and trust.Sharing ContentConvergence a complete transformation on how we do everything

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What Was Web 1.0?

Information Consumption

PUSH

Web 1.0 push content out to masses; advertisingWe searched for information and consumed it

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Trend #1 Web 2.0

Collective Intelligence

User Content

2nd generation of web development and design Facilitates communication, information sharing, and collaboration on the world wide web

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Trend #1 Web 2.0

Blogs & Wikis

RSS Feeds

Aggregate Sites

Social Networking

Blogs 200,000,000 blogs Wikis Collaborative user communities (ex: Wikipedia)RSS Updates are automated, update site and RSS updates thousands of areas on the webAggregate sites like indeed.com one stop shopping for candidatesSocial networking sites online communities that provide users a variety of ways to interact

3 out of 4 Americans use social technology.

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Social Media in Business

BrandingMarketingPublic RelationsCustomer ServiceLoyalty BuildingCustomer AcquisitionNetworking

RecruitingOnboardingSourcingSchedulingLearningThought LeadershipEmployee EngagementInternal Communication

Branding - #1 business use when polled

Recruiting is driving Web 2.0 in HR, FB & LI drive people to employers career site.Build brand awareness, attract new talent

Enhance learning opportunities through virtual networks

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Social Media HR Opportunities

88% look for jobs online, 60% apply online28% Millennials seek work through LinkedIn, report by I Love Rewards and Experience Inc.

86% of Americans plan to look for a new job in 2011 CNN Money

Open transparent conversation, build trustInbound Activities (search aggregate sites, research companies, ask friends)

Passive job seekers job hunting consumes 0% of their time60% think that hiring passive candidates results in better employees LinkedIn poll, 2009

Gather info to mitigate risk - Right person right position

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Social Media HR Opportunities

Gartner Research 80% learning comes from informal trainingImmediate, relevant training

Use to identify people who know a lot about their jobsConnect EEs with experts in the company

Using more sophisticated training tools that harnesses the power of social media and virtual worlds in favor of slides and conventional classroom environments

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World Class Examples

YouTube The Company as Wiki

We know that the best use of SM is relationship building and branding, you can be the one that gets your company ready for the movement!Whats working? Good Content, Good Community, Value of Relationships

Google The company as a wiki BestBuys move to Web 2.0, leading edge & bleeding edge

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Trend #2 Mobility

Statistics70% - Mobile phones for work50% - Check work email on weekend89% - U.S. companies offer telecommuting51% - American workforce is mobile

Sources: SocialcastTelework Coalition

1.2 Billion people carry smartphonesBy 2013, mobile will take over PC/Laptop use. 45% of all Social Media is done on mobile phones

Nearly 75% of the American workforce will be mobile by 2013, according to market research firm IDC.

You are your office text, phone, wifi, 3G - central office model is barely recognizable

SHRM Q1 2010 Study Virtual office is the office of the future

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Mobility HR Opportunities

HR Leadership

Social Media

Alerts/Triggers

Work/Life Balance

HR must be able to support the virtual workforceGenerational changes - The emerging workforce will be a blend of Baby Boomers, GenXers, GenYers, and the coming wave of graduates. New EE/Transferee changes HR Role as leader review policies, cultural fit, worker responsibilities, employer of choice

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Trend #3 Self Service

Automate AdministriviaSimplify/Enhance CommunicationConsolidate DataImprove EE satisfactionReduce Paper

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Self Service HR Opportunities

Employees directly view, create, and maintain information in a Web browser.Paperless office - Paperless payroll a big trend currently

38% use ESS33% use Manager Self Service

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Trends #4 Talent Management

Learning Tech Spending UpTalent ChallengesPerformance-driven CultureFilling Leadership PipelineDeveloping Skills to Address Business Challenges

Talent Management, or Integrated Talent ManagementMany silod applications are consolidating, traditional HRMS closing the gap on ITM.

Learning systems and training up 2% in 2010, after 2 years of spending cuts Bersin & Associates

SHRM Biggest investment challenge over the next 10 years - Obtaining and Optimizing Human Capital 47%

86% of Americans plan to look for a new job in 2011 CNN Money29% cite lack of advancement opportunitiesMore optimism, + recovering economic picture

War for talent 1997 McKinsey study coined the term

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Talent Mgmt HR Opportunities

Acquiring TalentSourcingSelectionDeveloping TalentSuccession PlanningSocial LearningAssessing TalentPerformance AppraisalGoals Measurement

Manage inordinate amount of data we collect on our best talentLeverage inordinate amount of data we retain on our best talent

Heightened competition for skilled workersRetirement of baby boomersHigh cost of turnoverOutsourcing trends

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Trends #5 HR Analytics

Data DecisionsMetrics/Key Performance IndicatorsAnalytical ToolsDashboards

Level ofAbstraction

Turn data into information, information into knowledge, and knowledge into plans that drive profitable business actions

Data - Collection of raw value elementsInformation - Facts can be gathered on data to draw conclusions.Intelligence - Use information to perceive, discover, and understand a best course of action

How do we get from information to intelligence?

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Analytics HR Opportunities

Link HR to overall business strategyMetrics can add to the HR professionals credibility and garner support for HR programs.

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Strategic HR with Technology

S-word

Organizations dont know yet how to use the HR information system, how to make it connect to the kind of things that make HR strategic

Professor Jon Boudreau, USCs Marshall School of Business

Honest look into HR and Technology

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Why Arent We?HR AdministriviaTransactional dutiesSocial work activities Comfort zoneHR Skill SetData Accuracy

Admin/transactional nature draws of HRComfort zone activities are EASY (transactions, paper admin)Soft side of business the people, and not the hard side the numbers

Forrester Research - over 50% of HR depts time is spent processing EE information and answering EE questions.Employees are children, and HR is their mommy and daddy

Different skill sets regression analysis, causal pathway modeling, predictive modeling

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Why dont we?Social workers and not interested in businessHR pursues efficiency in lieu of valueHR isnt working for youThe corner office doesnt get HR

Keith Hammonds editor, Fast Company magazine Why We Hate HR, 2005

[email protected]

HR doesnt serve corporate objectivesActivity driven - not delivery driven. Reactive around services. Forfeits long term value for short term efficiency.Due to labor regs, corporate policies, etc., HR is bad cop that is focused on here and nowHR and Executives dont speak same language.

HR not only doesnt have a seat in the board room, it doesnt have a key!THE KEY IS TECHNOLOGYHR Technology can overcome all 4 arguments.

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Measure HRs Impact on the bottom line

Use to influence CEO, CFO, CIO, CIA, CBS, or any other C-level executive in the companyMarketing decisions about customers Finance decisions about moneyIT decisions about technologyHR decisions about people

HR is the only department that has direct access to both the C-suite and people assets of an organization.

HR has its finger on the pulse of a company, and can report that data directly to those who need it most to make better business decisions.

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Leverage HR Technology

ONE: Reduce Social WorkUtilize TechnologyESSAlertsReporting

Technology will reduce admin so we can focus on strategy

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TWO: Serve the BusinessM, V, G, OHR Goals Corporate GoalsHR Metrics Business DecisionsData Integration

Understand mission, vision, goals, objectives of companyAlign HR Goals with corporate onesTie metrics to business decisionsDirect correlation of human capital performance and business performanceIntegrate your metrics with other departments (finance, customer satisfaction, etc.)

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THREE: Measure the Right ThingsBaby StepsK.I.S.S. Few, But LayeredStart With the End in Mind

What metrics are important to the company?Compare over time8-12 KPIs ("keep it simple and straightforward)Measures should be few, but layeredWhat is to be gained

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FOUR: Make Value, Not ActivityKey Performance IndicatorsScorecardsAnalysis

Make value, not activity (from HR Value Proposition Dave Ulrich). Pick KPIs that add value in making decisionsTraining attendees per month vs. Effectiveness of training Did trained staff learn anything to make them better workers? How did quality improve? How did customer loyalty improve?

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FIVE: Inquiry, Not IntuitionGet Answers From MetricsUse Standardized DataMeasure Consistently

... when HR uses fact-based decision making instead of intuition or best guesses the group becomes a more credible partner to the business it serves. Fact-based decisions help HR improve HCM practices, recruit and deploy the right talent, cut costs, contribute to business performance and provide evidence of those contributions.

- BusinessWeek Research Services, May 2009

Drive operational-decision making without hunches. Use metrics to answer important workforce questions.Use standardized auditable data Measure consistently (measure twice, cut once)Gain insights and credible what-if scenarios

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HR Analytics Examples

Revenue / FTE Links time and effort associated with firms human capital to its revenue output. Greater efficiency and productivity. $154K average

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Turnover Ratio

Turnover clarity dont just focus on turnover rate, study data on different data points and multi-dimensional analytics TenureBy wage ratesBy ageBy top producers

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Benefits cost factor, percentage of total compensation, workers comp, etc.

Profit Indicator/Human Capital ROI Pre-Tax Profit less Financial capital costs/human capital costs

Attrition Rate / Survival Rate

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Salaries as a % of Operating ExpenseAll Industries 57%Government Agencies 54%Nonprofit Organizations 56%Privately Owned For-Profit 60%Publicly Owned For-Profit 45%

Source: 2008 SHRM Human Capital Benchmarking Study

Investment in human capital is companys largest investment.HR - take the lead in identifying where people assets can best be allocated to meet the companys goalsHow to hire, develop, and retain the human capital the company needs to stay competitive now and in the future.Im preaching to the choir here, butIn a knowledge economy, companies with the best talent win

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Dashboard Metrics

Pull data from all sources and put into dashboard formDashboard graphical snapshot of business health from an HR Perspective.Easy to read, summary of companys current state of affairs

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Justifying HR Technology

Why HR Technology Isnt Implemented:Budget/Funding approvalUnclear GoalsNo Buy-inResistance to ChangeIT InfrastructureNo Decision

Spending is at an all-time low in the current economic situationOnly 1/3 of those polled in SHRMs 2005 Technology survey say their HR technology implementations were extremely successfulWhy buy more after being burned?Current technology (10+ year old legacy systems) works

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10 Steps to Obtaining Tech

Expand Your HR Technology KnowledgeWebinarsIHRIMFollow HR Tech Experts

Understand current trends, where technology is headed for HR. Webinars, etc.Twitter good place to follow experts

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2. Determine Your Current RealityTechnologyProcessesWorkflow

2. Determine current reality The project is a journey to a destination. You need to know where you are now to determine how to get where you want to go.

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3. Develop Needs and Wants List

Need vs. Want I need a car, I want a Mercedes S-ClassSeek help plenty of great organizations that determine current reality and analyze needs

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4. Create a Business CaseGoals and ObjectivesCosts and Saving MeasuresDefine Current HR IssuesOutline Productivity IncreasesMore Strategic OpportunityMetricsKPIsBusiness Impact

Align goals/objectives with business Show that investing in HR Technology will have operational impact.

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5. Calculate ROI and Rate of Return

Hard Costs

Soft Costs

SHRM estimates the paper costs associated with benefits enrollment at $27.50 per employee.

ROI Example: $1.92/check delivery (forms, ink, MICR, time to fold/stuff, distribution & mailing)Annual cost = $20,616Investment to provide employee self service = $20KHard Cost ROI in less than 12 monthsHOWEVER Soft costs (added employee value, less admin = more productivity for HR)

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Tactical Benefits

Strategic Benefits

5. Calculate ROI and Rate of Return

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Determine BudgetUse Business CaseUse ROI

Work with mgmt on budget having ROI helps!We dont have a budget. Everyone has a budget, whether its for a gallon of gasoline or a new carBoth of which will cost the same very soon.

Ask consultant How much do you charge?Typically we scope and plan the project in advance, so we charge $50,000 for three questionsIsnt that a bit expensive?Yes, now whats your third question?

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Research Software & CompaniesEvaluate SystemsFlexibilityScalability

We typically start at step 7, which is a mistake this is the fun stuff, the easy stuff. Exercise due diligence on technology vendorsFind someone that you will want to work with in current and future That understands our Vision, Mission, Goals, your Business ObjectivesPick 3-5 technology solutions to review

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Set Implementation ExpectationsMake Purchase Decision

1/3

Less than 1/3 of all IT projects finish on-time and on-budget. Standish Group 2006 Chaos reportFrom poor planning, unclear goals/objectives, lack of buy in, and unrecognized destination

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In Summary

Social Media and Workforce Mobility are changing the dynamics of HR Technology. Popularity of Employee Self Service and Talent Management systems has increased.HR Technology can increase HR effectiveness, but will ultimately make HR more strategic.Utilize technology to create business oriented analytics and metrics.Justify HR Technology by creating an ROI with clear goals and objectives.

What is your HR technology strategy?What system functionality do you need?What results do you wish to accomplish?What work processes do you wish to change?How will we handle change?Software or subscription?How does this system support the overall needs of the business?What HR metrics help drive business decisions?Who are the decision makers internally?What is your internal technology environment?What is your budget?

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Thank You!

Harold G. Ford IIIDresser & Associates, Inc.

http://www.linkedin.com/in/haroldgfordiii

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Dresser & Associates, Inc.
