subject: Hr Transformation - A Sure Thing [print this page] Needless to say I was shocked when my people finally came to me with an answer to my long standing request to give me a good "guess" as to how much money we could declare that we saved the business as a result of the work we did with HR transformation over the last three years.
Conservatively, the figure landed somewhere around four million dollars annually! (Not bad but my best estimate after digging into the details a little was that the real figure was about three times the number originally given to me.)
This had been the best HR job assignment I had ever had during my long career and my experiences had taught me to be a little skeptical about projections. The fact is that their analysis was pretty darn exceptional.
Most folks, including those in HR, don"t really know about or understand the power of HR transformation"improving HR CAPABILITY through new and innovative ways of working. At first blush it would seem that this is an easy concept to accept"like "moms and apple pie". However, the ability to help your organization go from good to world-class because of an exponential increase in HR effectiveness cannot be underestimated.
The purpose of this article is to help HR professionals understand the incredible opportunity inherent in pursuing this strategy and to look at some of the steps to take in getting started.
The Business Case
In most businesses today business processes (including HR) are not coordinated or integrated for maximum effectiveness and use by employees. It is incredibly time consuming for individuals to find the information they need to get both personal and professional objectives accomplished. Either the employee simply doesn"t know where to start or the information available is inaccurate and too cumbersome to sift through to get at what he or she really needs.
Many businesses today have no direct way to engage and focus their employees so that they are more productive because they have the information necessary to manage their lives effectively. Often attempts to secure required information to manage a process or execute an administrative transaction results in redundancy"a much lower level of productivity than most companies realize.
Within HR specifically, experts surmise that fully 80% of the interactions or encounters with managers and employees are transactional or information seeking. What if these interactions could be handled in such a way as to result in their getting what they need at a fraction of the cost to the business? Proper re-engineering of people programs, policies and processes could yield significant savings in operating costs.
What does poor business processes cost your company? The impact could be surprising. For example, one study conducted by a major consulting firm in recent years suggested that with the right systems and processes in place a company could mitigate its absenteeism costs by as much as 15 percent of payroll and benefits expense!!
I quickly calculated that such an effort could yield my employer at the time literally well over a hundred million dollars in freed up cash. Remember, at this point we"re only talking about absenteeism. Even assuming that these were wildly speculative projections, with minimum investment and good program redesign, I could still conservatively impact the bottom line to the tune of millions (and that"s exactly what we set out to do).
The typical HR environment is highly administrative, usually decentralized, involves lots of forms, leaves managers and employees often frustrated with unanswered questions or incorrect response and policy driven.
The benefits for pursuing an HR transformation strategy are many:
"A unified approach to accessing and using information (24/7)
"Quicker access to information for business and personal empowerment
"More quality (accurate and relevant) information available to employees
"More employee focus on the things that matter most to them AND the business
Needless to say, the "transformed" HR organization can result in simplified processes, shorten cycle times, few or no redundancies, better customer focus and fewer handoffs yielding less confusion and mistakes.
Many of you are probably familiar with Dave Ulrich"s model of HR Effectiveness. He contents that if you really want to be a fully functioning business partner in pursuing the organization"s business objectives, then the price of admission is a redesign of the HR function in such a way that it becomes more effective by executing the "basics" well. In addition, Ulrich notes that you should focus competent resources on helping the organization with strategy and change.
