IMPACT LECTURE OF HUMAN RESOURCE

By: Ms. Darshita Mirani

First Generation Human Resource Transformation

HR Transformation

• HR Transformation initially focused on making HR operations more efficient and effective through process standardization and technology.

• First Generation HR Transformation represented a fundamental shift in HR’s role, from transactions and administration to strategy and business transformation.

• The transformational HR department is one that is recognised by the organization as being an important contributor to the company’s future and is engaged in activities that will help move the organization forward.

Why and when transform HR?

Why transform HR?

The need to provide the business with:

More efficient, customer focused delivery of services and processes

A more flexible HR service capable of responding quickly to

organisational changes and priorities

Transparency on the cost and value of HR

When is a review appropriate?

With the appointment of a new HR director

After a merger, acquisition or restructuring

When HR priorities do not tie into the business strategy

During a period of change when the role of HR is unclear

When the HR function is under pressure to reduce costs and demonstrate

added value

When outsourcing or establishing a shared service is being considered

Whenever you feel HR performance can be improved

HR effectiveness methodology

Key Activities

Objectives of the transformation

Shift from transactional to value added activities in HR function

Improve overall business support and customer service

Improve functionality and cost efficiency for transactional, non-value

added activities

Scenarios

Outsourcing of payroll & admin

Payroll & admin in Service Centre:

Payroll & admin in Service Centre:

Other location

•Cut staff numbers•Reduce indirect costs•Focus on value-added activities•Compliance responsibility to the outsourcer

•Cutting staff numbers •Reduce indirect costs•Greater efficiency•Remaining in charge of quality •Less redundancy cost

•Same as in SCENARIO 2•Best use of local staff expertise and costs

•Suppliers market•Quality risks•Difficult transition•High redundancy/reskilling costs

•Effort to gain consistency of processes•Investment in HRIS •Management of costs

•Same as in SCENARIO 2•Higher investment ininfrastructure•Higher coordination costs

Ris

ks

S

cen

ario

s

Ad

van

tag

es

Chosen model

Payroll processing

HR

Administration

Customer serviceOUTSOURCING

What First Generation HRTransformation Set Out to Accomplish

• Reducing costs through shared services centres, selfservice,and outsourcing.

• Streamlining technology and information management.• Managing people globally. • Enabling HR to shift its focus from administration to

strategy.

How Did First Generation HR Transformation Actually Play Out?

• Business Drivers:• The First Generation vision was for HR to become so efficient at

transaction processing and administration that it could shift its focus to more strategic issues.

• HR Transformation teams were asked to justify their capital investments by showing they could reduce the overall cost.

HR Process

Geography

• To build and implement a global HR function, transformation teams had to figure out how to work across national boundaries and how to phase their work geographically.

• At the outset, many companies attempted to establish global standards by building a template of the services, processes, and systems in their home countries, and then pushing them out to operating units in other.

Major Accomplishments from First Generation HR Transformation

• New service delivery model.

• Global impact• Process standardisation.• Self-Service• Reduced Administration• Centralization

Proposed HR Delivery model

HR business partners, directly responsible for the HR management in

each company and integrated in the structure of the company

A head-office / centre of excellence formed of a group of highly-skilled

specialists, focusing on strategic change, design and development of

programs

A services area that takes over the transactional, non-value added

activities, from the HR function

Next Generation• The next generation of HR Transformation is more tightly linked to

corporate strategy and to creating business value.• The Next Generation of HR Transformation will look outside the function to

help companies achieve their desired results and growth in an environment where competition is global and talent is scarce.

An HR Service Delivery Model for Today — and Tomorrow

Addressing Strategic Business Challenges

• Workforce planning

• Talent Management

• Merger integration

• Global HR Programme Management

• Change Management

• Global Workforce Security

• Global Mobility

HR Transformation Companies

• PWC

• KPMG

• Deloitte

• Voltas

• Tech Mahindra

HR TRANSFORMATION OF VOLTAS 2009

• HR Staff Strength• 6.9 per 1000 employees in 07-08• 4.9 per 1000 employees in 08-09

• HR Cost as %age of revenue• 0.25 % in 07-08• 0.17 % in 08-09

• Employee Leave Balance• 31 days per employee on 31st Mar’08• 21 days per employee on 31st Mar’09

• Employee Productivity

HR Transformation In Public Sector

• HR transformation can take many forms in the public sector. For

some organizations, it means migrating to shared service centers or to

centers of excellence in order to reduce duplication and to enhance

service consistency.

HR transformation projects are focused on creating strategic partnerships between HR staff and business managers to meet business objectives.

• Transformation initiatives might only require reinventing specific policies and HR programs to capitalize on efficiencies

to meet business goals.