Redesigning the HR function: summary

Things are going wrong in the change process for many organisations

Organisations trying to change often see certain things going wrong:

HR is not in control of the whole business to employee relationship, so its efforts to implement change are constantly being thwarted

The rush to implement self-service technology means businesses are overlooking the challenges of the broader business change required to support a self service model

The potential hazards involved in outsourcing in its various forms, particularly the extent of the business change required, are not being considered carefully enough.

What to consider when making changes to your business organisation

There are two dimensions to consider when making significant changes:

the four stages to follow in the change

the four aspects to consider throughout the change.

Aspects to consider

Whatever the change, people will feel stressed and inevitably display some resistance

Processes and business organisation will always change

Change will require new behaviours and skills on the part of everyone affected directly and indirectly

New technologies will be part of it.

Stages to follow

Start with thinking and planning:

develop a vision of where you want to go

develop a sound, initial business case engage your stakeholders in the change process

Effective specification and selection will ensure you :

specify a solution that takes account of all the above aspects

fully plan activities to achieve both the concrete changes and the changes required to people's attitudes

conduct an effective vendor selection process if required

build a convincing full business case for your recommendation.

Building and implementing will then:

see a comprehensive and integrated technology and business change programme being executed

see an effective set of change management activities being carried out

be managed by HR, not IT.

Bringing the project to a close with coaching and improving will see you :

devoting a significant amount of the project budget to the post-live period

continuing to train and coach people in the new skills and behaviours required for the change

monitoring the quality of the required changed behaviours to provide feedback for these coaching programmes

monitoring the effectiveness of the new HR design and making changes to the model as necessary.

Solution options available

Restructuring HR can make use of one or more different possibilities.

Shared service centres

SSCs pull together all administrative functions under one roof, although this can be an electronic roof in the case of a virtual SSC. SSCs can be internal or outsourced.

SSCs offer:

consistency

economies of scale

synergy.

But you must be aware of the possibilities of:

poor service quality

disappointing cost savings

extended payback times.

Application Service Providers

ASPs provide the technological infrastructure for implementing new processes. They offer:

lower financial outlay

no need for dedicated IT staff of your own

speed of implementation.

However, beware of:

becoming dependent

prices increasing unexpectedly

information security issues.

Business Process Outsourcing

With BPO you subcontract policy and administration of an area of HR to a third party.

BPO allows your business to focus its efforts on its core business but it can lead to:

loss of control

loss of flexibility

lower cost-savings than expected.

Self-service e-HR

Self-service e-HR technology can give managers and employees the power to maintain their own personal information and manage their own HR transactions. In its more complex forms, this can integrate separate HR systems and functions, such as personal data, recruitment, time and attendance, compensation and benefits and training.

Self-service e-HR can offer:

higher quality data

reduced administration costs

less processing of paper

possibilities for proactive information

easier compliance with data legislation

However:

systems can be harder to use than expected

there can be difficulties for people with disabilities

data security needs careful attention

access can be difficult to non-computer users.

Call centres

Call centres offer a single source of information by phone for staff.

They offer:

economies of scale

a useful alternative or complement to self-service HR

flexibility.

However, there may be:

staff turnover issues

lower service quality.

Specifying requirements and selecting providers

When you specify the requirements you wish to implement and select a provider (if required), you must:

know what you need and specify this, not what you can buy

remember all work streams: not only the 'main event' of implementing the selected solution itself (i.e. new technology or new SSC), but also the realignment of the supporting roles and processes, embedding of the necessary skills, and establishment of adequate support for the change from all affected parties

decide whether to rent or buy

choose the right type of technological solution

choose suppliers you can work with

build a relationship with your suppliers

keep responsibility for the project within HR.

Building a business case

To build a sound business case you must:

know where you are in the approval cycle

know your audience

address all the areas where you can add value

be realistic in what you propose

take account of all the risks and constraints you will be working within

present both qualitative argument and a proper financial business case in your final document.

In conclusion. . .

We hope you find this guide thought-provoking and useful. In many ways, changing the way HR works is like pushing a boat through water: as it moves it sends out bow waves ahead and creates eddies behind that change the world around it in unintended ways. Well-managed change processes, and in particular thorough planning, mean you can take these inevitable effects into consideration.

We wish you well in the uncharted waters ahead of you.

Personnel Today Management Resources one stop guide on redesigning the HR function Section one: The argument for HR redesign Section two: The changing role of HR Section three: Making the change Section four: A guide to the solutions you may be considering Section five: Specifying requirements and selecting suppliers Section six: Building the business case Section seven: Summary