Transforming HR The Advantage of a Multi-Tier Approach to Delivering HR Services

2The Advantage of a Multi-Tier Approach to Delivering HR Services

The Challenge of HR TransformationThere has been a lot of talk in recent years about transforming the Human Resources function to be a true business partner. Generally defined, HR transformation means spending less time on administration and transactions, and more time on adding value as close as possible to the business units. Easier said than done and the reason is simple: Most HR talent is typically too busy answering administrative questions and providing HR services to take on more strategic roles. In fact, according to an October 2008 Gartner Report, HR organizations spend as much as 70-80% of their time dealing with administrative activities and employee/manager questions and issues.

To achieve HR transformation, it is vital that HR separate administrative and service delivery operations from its strategic work. Again easier said than done. The reason? Todays economy has forced many HR organizations to operate with a smaller budget and reduced staff. Yet all HR professionals working during the last recession after the dot.com bubble burst learned a lesson: to turn things around, and to maintain productivity and loyalty, it is important to continue to engage employees, and provide quality HR services, even during the toughest of economic times.

And, therein lies the question: How do you provide a high level of HR services with the minimum number of people and dollars? For that answer, many organizations are turning to technologies that provide better delivery of HR services, with fewer people, and lower hard-dollar costs. There are many models for HR service delivery the best known is from CedarCrestone and is available in their annual CedarCrestone HR Systems Survey (for a copy of the latest CedarCrestone survey go to www.cedarcrestone.com).

Performance ExcellenceService Delivery ExcellenceAdministrative Excellence

Portal Framework

Help Desk Call Tracking Case Management

HR Knowledgebase Analytics

Data Warehouse

Core HRMS/ERP FoundationData for Roles, Personalization

Position Mgmt and Competencies

HCM Apps Talent Acquisition Mgmt Competency Mgmt Learning Mgmt Compensation Mgmt Performance Mgmt Succession Planning Career Planning

Self Service Transactions ERP Third-party Vendors

Identity Management Single Sign-on

SCM

CRM

FIN

Figure 1: CedarCrestone HR Service Delivery Excellence Model

3The Advantage of a Multi-Tier Approach to Delivering HR Services

Although the model may vary slightly, in general, HR service delivery includes solutions for Portals, HR Knowledgebases (which may or may not include employee communications and benefits decision support), onboarding orchestration technology, employee/manager self-service applications and HR-shared services/case management tools. In all models, the components will connect with HRIS and related solutions (i.e. payroll, benefits). These tools allow HR to truly do more with less, providing quality services to the workforce while playing a leadership role.

The key behind the recent growth in the deployment of these solutions is that by harnessing the power of todays HR service delivery applications, organizations can adopt a multi-tier approach to service delivery. This approach helps ensure the success of HR transformation initiatives, creates a more loyal, engaged workforce, allows HR to free its talent from daily inquiries and reduces costs. Lets take a look at the multi-tier approach.

The Multitier Approach to HR Service DeliveryWhat if your employees could get their own answers to HR questions 80-90% of the time or more? What if the majority of remaining inquiries could be managed with an in-house HR Shared Services Center handling the highest number of calls with the minimum number of customer service representatives (CSRs)? And, what if fewer than 10% of employee inquiries were escalated to HR experts? Thats the idea behind a multi-tier HR service delivery model. (See Figure 2.)

Figure 2: Multi-tier approach

Tier 0: Employee gets own

response & completes own transactions

on portal

66%

Tier 1: Ticket to shared services center,

call centeror helpdesk

28%

Tier 2: Escalateto experts

6%

4The Advantage of a Multi-Tier Approach to Delivering HR Services

As the diagram shows, Tier 0 service delivery is when an employee or manager uses an HR portal and self-service solutions to answer their own questions and complete their own transactions. Todays highly-evolved HR service delivery platforms include personalized, searchable knowledgebases making HR portals more conducive to providing fast, relevant information and therefore increasing usage and effectiveness.

By deploying a personalized, searchable portal with communications connected to self-service transactions, a key performance indicator of 66% is achievable (KPIs from the previously mentioned October 2008 Gartner report), meaning that 66% of inquiries should be able to be resolved by the employee or line manager at the portal level.

For those issues that cannot be resolved at the Tier 0 level, Tier 1 of the multi-tier service delivery approach involves escalating inquiries to an HR Shared Services Center (SSC), help desk or call center (depending on the size and decentralization of the organization). The key here is that the SSC and portal share the same knowledgebase which is personalized for every employee. With access to the same knowledgebase and the employees personalized information, CSRs are able to resolve issues quickly typically on the first call allowing more calls to be managed with fewer reps. Best practice KPIs indicate that 28% of issues that are escalated to Tier 1 can be resolved at this level.

Only when an issue cannot be resolved at Tier 0 or Tier 1 is it escalated to HR experts on the various topics and domains. In this model, no more than 6% of issues escalate to this tier.

The same 2008 Gartner report concludes: A properly implemented multi-tier model expands the use of self-service applications, leverages less-expensive service center agents (while still providing a high level of service) and reduces the amount of time HR subject matter experts spend answering routine questions, freeing up their time to spend on more value-added activities.

A More Effective Way to Deliver HR Services When it comes to human capital management software, most of the focus in recent years has been on talent management applications. These applications play a crucial role. The focus appears to be shifting to include HR service delivery as well. This is good news for HR and HR transformation because:

1. HR transformation initiatives are less successful when HR service delivery resources are also responsible for HR strategy.

2. Employers in todays economy are challenging HR to operate with fewer resources and slashed budgets, and doing so without sacrificing the quality of services provided to the workforce.

3. HR must meet the expectations of employees. These solutions are not just for tough economic times. They are about engaging and meeting the expectations of todays internet-savvy workforce. Even those who work in the field or on shop floors without daily internet access on the job go home to shop on eBay, pay their bills online, email friends, check the weather, plan a vacation, etc.

At home, using Yahoo!, Google and other search engines, your employees are never more than two clicks away from the information they need, when they need it.

Whats more, many popular internet sites are personalized to the users, and presenting them only with information that is relevant to them, allowing them to complete transactions (buy a book, book travel) in the same session as finding and receiving the information.

5The Advantage of a Multi-Tier Approach to Delivering HR Services

This is the expectation workers bring with them to the job when they access your portal. Some of the questions your employees might be asking are

If Amazon.com knows who I am, how come my employer doesnt?

How come I have to log in and out of several systems just to complete a transaction, like choosing a new plan option during open enrollment?

These employees do not want to call HR any more than HR wants to use its talent to answer such questions. But without effective service delivery technologies, the frustration grows, exasperating employees and managers and interfering with true HR transformation.

So now, lets look at the technologies in the new HR service delivery model. For the following sections, well be referring to Figure 1 (repeated for your convenience).

What if Employees Were Only Two Clicks Away From the HR Information They Need, When They Need It?

The Portal The front-end technology in the HR service delivery model is an HR portal. This can be a stand-alone HR portal or a sub-portal, dropping into an enterprise portal, like PeopleSoft, Lawson or SAP or an enterprise portal, like Microsoft Sharepoint or IBM Websphere.

Now, portals arent a new concept. In fact surveys show that the majority of employers with more than 500 employees have some sort of HR portal, or intranet/extranet, in place. The issue has been, however, with the usability of these portals.

Performance ExcellenceService Delivery ExcellenceAdministrative Excellence

Portal Framework

Help Desk Call Tracking Case Management

HR Knowledgebase Analytics

Data Warehouse

Core HRMS/ERP FoundationData for Roles, Personalization

Position Mgmt and Competencies

HCM Apps Talent Acquisition Mgmt Competency Mgmt Learning Mgmt Compensation Mgmt Performance Mgmt Succession Planning Career Planning

Self Service Transactions ERP Third-party Vendors

Identity Management Single Sign-on

SCM

CRM

FIN

Figure 1: CedarCrestone HR Service Delivery Excellence Model

6The Advantage of a Multi-Tier Approach to Delivering HR Services

For the most part, portals are filled with non-personalized, non-searchable content, making it difficult for employees to find the information they need, when they need it. Additionally, most employee, manager and benefits self-service transactions in place at an employer are also accessed through the portal often not in context to the content, and worse, often with different passwords.

For portals to be successful, they must first unify all of the various applications and content into a single, easy-to-navigate front-end interface. Second, the portal needs to provide a single sign-on for all of its various components.

The KnowledgebaseAn HR knowledgebase contains all of an organizations policies, employee benefit information, work/life event management, manager information and much more.

Key to the need for a knowledgebase in the service delivery model is that the most evolved of knowledgebases are both personalized and searchable. This means that the information presented to an employee or manager is based on that employees ID, job role and/or location, and only relevant information is accessed.

On top of the personalization is a sophisticated search platform. The goal should be for an employee to never be more than two clicks away from the information he or she needs.

For example, an employee searching on "Maternity" would be within two clicks of the checklist (items such as the employers policy on leave of absence, for example) as well as information on the employees specific maternity coverage from their selected health plans. It is this ease-of-search and personalized information that's relevant to the employees event and/or transaction that allows members of the workforce to get answers to their own HR questions as often as 80-90% of the time.

Many knowledgebases also contain wellness information and benefits decision support tools. These valuable tools have helped both employers and employees contain health care costs by driving employees to more cost-effective plans, and being informed consumers of health care.

What if You Could Streamline Onboarding Process and Cost While Still Engaging New Hires for Talent Retention?

Another key component of the HR service delivery model is onboarding orchestration technology. This emerging technology is become mainstream fast. Todays typical onboarding process can take as many as 30 steps involving 14 systems, not to mention time on the part of the new hire, hiring manager and HR.

Innovative onboarding technologies not only streamline the process, they allow employers to bring new hires quickly into the corporate culture. They handle provisioning and notifications, so new hire productivity on Day 1 is increased. And when the onboarding process continues past Day 30, 60 and beyond, the bonding continues, by integrating benefits decision support via the portal/knowledgebase, and introducing performance goals through, for example, a performance management system reducing new hire turnover.

Case in Point:

A Lawson customer in the healthcare industry was able to consolidate five hiring locations into one, while reducing new-hire turnover by more than 4% in just the first 90 days. They project savings of $1.4 Million in 3 years.

7The Advantage of a Multi-Tier Approach to Delivering HR Services

What if Your Employees Could Truly Handle the Majority of Work/Life Events on Their Own?

Employee and Manager Self-Service are a part of the service delivery model, critical to the ability for members of the workforce to manage their own work/life events without HR interference. The key here is that the self-service applications are not only accessed via the portal, but integrated with the knowledgebase, providing in-context communications and decision support access to the information required

to complete the events.

What if Your In-House Shared Services Center Could Handle the Highest Number of Calls with the Fewest Number of Reps with Most Calls Resolved During the First Call?

The last component of the HR service delivery model is the HR shared services operation. Using the portal, and the searchable, personalized knowledgebase, CSRs require less training, can access an employees specific policies, benefits, etc., and provide first-call resolution. Because the majority of users are getting their own answers in Tier 0, employers have been able to staff SSCs with fewer reps, providing accurate answers, mostly during first-call resolution. And because of the access of the knowledgebase, CSRs get up to speed quickly, escalating approximately 6% calls to these experts and freeing them to do other work.

For example, a Lawson customer in the technology industry was able to staff their Shared Services Center with only 6 CSRs for 6,000 employees, resolve 97% of inquiries on the first call and achieve a 98% satisfaction rate among employees.

This is the foundation of successful HR service delivery.

Gaining Executive Buy-InOf course getting C-level buy-in is a critical component in moving forward with any new service delivery model. One thing that is important to focus on is that this is not new cost. It is really a replacement of cost for things already being done but in such a way that should reduce costs over time with a more effective result. Some good pointers come from Doug Wilwerdings article, What Makes the CEO Say Yes, first published on eBIM and later on IQPCs HR IQ:

1. How does this connect to the larger strategy?

2. How does this impact our employees?

3. What is the lasting nature of this proposal?

4. What are the resource implications?

5. What is the ROI and how will it be measured?

6. Has the life cycle been thoroughly vetted?

7. How passionate are the advocates?

8. How passionate am I about the proposal?

A key here is to show that this isnt about making the work of HR easier. It's about providing overall value to the business.

Case in Point:

One Lawson customer with 14,000 employees and in the manufacturing industry, leveraged the multitier model to further its HR transformation. The results have been impressive:

- The amount spent annually on HR

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Change ManagementOf course moving to this new HR service delivery model will require comprehensive change management to have true impact, both financial and business change. Entire articles and books have been written on change management, but some excellent food for thought comes here from Karen Beaman, founder of the Jeitosa Group, in her change management session at the May 2010 HR Shared Services symposium hosted by IQPC. In this session, Beaman recommended that organizations:

1. Identify change agents and engage people at all levels in the organization.

2. Ensure the message comes from the top, and that executives and line 2 managers are not just talking the talk but walking the walk.

3. Ensure clear, concise, and compelling communication.

4. Connect change goals to day-to-day activities, e.g. recruiting, performance management and budgeting.

5. Address short-term performance while setting high expectations about long-term performance.

6. Help management avoid attempts to short circuit the change management process.

7. Foster change in peoples attitudes first, then focus on change in processes, then change in the formal structure.

8. Manage both supporters and champions, as well opponents and possible detractors.

9. Accept that all people go through the same steps some faster, some slower and it is not possible to skip steps.

10. Build a safe environment that helps people to express feelings, acknowledge fears and use support systems.

11. Acknowledge and celebrate successes regularly and publicly!

The Bottom LineOrganizations looking to transform HR should take a serious look at this new HR service delivery model. Its validity is not just the right direction for times of economic uncertainty, but for the future of HR transformation. This model has been proven to allow HR to focus on value added work, while providing improved HR services to the business units with both fewer people and lower costs. Whats more, this type of model can be deployed rather quickly with ROI usually realized in the first year.

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