People
tasks have been passed down to line managers in recent years, but with
operations spreading across the world, HR increasingly relies on technology to
spread the workload, says Sally O’Reilly
It’s
a truism that global HR managers need to think strategically, rather than spend
their time on routine administration. But achieving that goal isn’t always
easy. And while devolving some of the day-to-day responsibility to line
managers has, for some years, been seen as one of the solutions, increasing work
pressures have made it difficult for line managers to take on additional people
management roles.
For
global firms, this has been further complicated by the sheer scale of their
operation, and the legal and cultural variations in different countries. Now,
however, technology seems to be unblocking the log jam, and global IT companies
such as Cisco Systems and Oracle are leading by example.
"Technology
is the enabler to provide the type of information in real time which gives line
managers the ability to take on more HR responsibilities," says Petra
Elliott, managing consultant with Chicago-based management consultancy Hewitt
Associates, which works in 40 countries across the world. "Prior to the
existence of portals, it was difficult to give line managers this type of
information."
For
instance, while line managers could be given relatively static information
about the pay received by an individual employee, they couldn’t be given the
means to look at different pay options for that person. For global firms, there
was the additional difficulty of maintaining consistency and control across the
organisation.
Elliot
believes there is an obvious reason why technology firms have now taken the
lead in this area. "IT companies have more consistent technology platforms
to base this on," she says. "To work effectively, the software
products need to be flexible enough to host the appropriate content, and to
allow flexibility to evolve over time. Any firm with a devolved HR system in
place needs to keep up with corporate change caused by mergers and acquisitions
or developments in business strategy and hiring profile."
Areas
that can be most effectively devolved using IT include performance management,
career development, e-learning and salary review. Line managers can also have
instant access to information about HR functions which have been outsourced –
such as pensions, flexible benefits and induction processes. In companies
operating globally, a unified system for storing and retrieving information is
an essential tool for HR departments.
Kevin
Delany, a partner at PricewaterhouseCoopers, says that this is another field in
which the US leads the way. "There are different markets and different
factors across the world, but this approach to devolving HR is mostly happening
in the US and Europe. For instance, General Electric has devolved people
management down the line."
Cisco
Systems is another major US firm that has used IT to devolve HR. The company,
which employs over 43,000 staff worldwide, provides computing devices and
computer networks to client companies, which allow them to access or transfer
information across the globe, and sells its products in around 115 countries.
It also uses the Internet to streamline nearly every aspect of its own internal
business – a method of working known in the US technology industry as
"eating your own dog food".
Employees
arrange benefits, file expense forms and complete training programmes on-line,
while managers use it to monitor staff performance. A typical Cisco employee is
estimated to tap into the company intranet more than 30 times a day.
Prospective
employees are also encouraged to apply on-line – and more than 80% use this
method. Much of the company’s training also takes place on the Web – for
instance, the company posts audio-visual presentations about new acquisitions,
products and technology.
Yochanan
Altman, professor of international HRM at the University of North London and an
independent consultant who has worked in France, Austria, Hungary, Israel,
Australia and Hong Kong, warns that the Anglo-Saxon background of this
IT-enabled trend could cause global firms to overlook national differences.
Technology makes the process more efficient, but not less complicated.
"You
have to be cautious about delegating too much to the line without taking into
account the legal framework in the country you are operating in – for instance,
Marks & Spencer made this mistake in France when it tried to close down an
operation without going through a 30-day consultation period," he says.
"Often,
you have to have staff of a certain position in the hierarchy to make decisions
– in Belgium, which has the highest union density of any country in Europe,
there are certain matters which have to be dealt with by staff at board level."
So,
whatever system is used to streamline and focus global HR policy, there are
some areas of responsibility that senior personnel managers will need to
retain. But Vance Kearney, European HR director with Oracle (see case study),
says that if IT systems are thought through by HR managers strategically enough
at the outset, such considerations can be built into the overall strategy. And
it is possible to create a new way of operating a personnel strategy which can
react to changes and developments as they occur.
"Where
HR involvement is key, is in drawing up the right system in the first
place," he stresses. "You have to have a common language, by which I
don’t mean English, but an agreed way of defining such things as jobs, skills
and staff turnover. Everything needs to be standardised across the
company." That means acknowledging national differences and the need for
regional flexibility while still building a consistent system. "If there
is too much compromise across international borders, then everybody will be
doing everything slightly differently – and that is a recipe for
disaster," he asserts.
"And
you won’t be able to take advantage of new technologies as they arise, because
it won’t be a case of switching off the old way, and turning on the new, but of
trying to switch off 200 old ways – which could literally take years. You have
to take a very strong leadership position and be determined to fix it once –
for everybody."
Petra
Elliott of Hewitt Associates agrees, and says that this calls for improved links
between IT and HR staff at senior level. "There has to be a strong bridge
between HR and IT," she says. "Both sides need to consider the
potential of the other when developing new products or introducing new
policies."
She
sees IT staff as offering not only the means for personnel strategies to be
devolved to the line, but also as role models for HR managers who are seeking
greater corporate influence. "IT has really risen in importance in the
past five or six years – the CIO is now one of the most important people on the
board," she points out. "And HR is going down the same route."
Tips
for devolving HR
Devolving
HR has enormous implications for an organisation, says Adrian Hobbs, COO of HR
Payroll at Microsoft Great Plains Business Solutions. He offers some
fundamental points to help ensure successful implementation and full
organisational support:
–
Know your people. Understand how employees adapt to new working processes and
whether they adopt new technology easily; what will help them to work with the
system?
–
Involve key colleagues at the start. Getting "buy-in" from
stakeholders can make or break the process. These could be the IT department,
senior executives, line managers or even "evangelists" who will
promote the system down the line.
–
Create a clear business plan with defined goals. The plan should be all
encompassing, but goals can focus on particular organisational areas that need
improvement – this will also provide a clear measurement tool after
implementation.
–
Ask for expert advice about the solutions available to implement the right one
for your organisational needs.
–
Create a rollout schedule that fits your organisation. Once the human resource
management system (HRMS) is up and running, create small steps to help
encourage employees and managers to take part. Show how easy the system is to
use – and, importantly, why it eases their workload or benefits them.
–
Support the employees; support the new system.Â
Show the organisation that you are on hand to answer questions and help
with dilemmas. Deal with employee questions straight away to help get them
onside. Always remember that some people take longer to adapt to new processes.
–
You may want to use the marketing department to promote the system, explain why
it is being implemented and raise its profile with success stories. Consider
"launching" it by showing it in the office reception or another
visible employee meeting place; hold breakfast meetings or seminars;
communicate via the company intranet or newsletter. It may also be worth
regularly researching how the system is working by holding focus groups or
issuing surveys.
For
your copy of the Microsoft Great Plains Business Solutions white paper on the
full implications and strategies surrounding e-HR, contact +44 (0)1628 404505
or visit www.greatplains.com/europe/hrp
Case
study: Oracle
In
Europe, the Middle East and Africa, Oracle has 14,000 employees in 32
countries, whose needs are met by an HR department of around 140 people. For
the past four years, the HR department has been devolving certain HR functions
to the line, using its own Oracle HR system.
"We
started with pay slips on the Web, instead of having hard copy pay slips,"
says Vance Kearney, European HR director. "Then we enabled employees to
access and update their own data, and since then we have introduced more and
more Internet-based processes." The full range of HR activities now
available on the Internet includes:
–
employee data
– pay slips
– salary reviews
– flexible benefits
– management of purchasing of products and services bought from internal
departments of the company.
"It
has given us far more flexibility," says Kearney. "And it has ended
the linear relationship between the number of people in the HR department and
the number of people in the organisation as a whole. We could probably increase
overall staffing levels by 50% without adding more HR people."
To
work effectively, stresses Kearney, a devolved HR system needs to be thought
through in detail before implementation starts. It will need to be updated and
added to over the years, but getting the system right in the first instance is
essential if the organic process is to work properly.
"You
need to work out what needs to be different and what needs to be
standardised," he warns. "It doesn’t make sense to have 32 different
systems to do one thing. But there will be a slight difference in the way that
things are done in each country. For instance, when we started, we had 32
different telephone systems in operation, and now we have one global system.
That is a process that can be standardised."
Other
functions need more careful handling as well. Kearney cites the example of
updating records – a simple process in the UK, but in Switzerland, where
citizens are taxed according to the canton in which they live, the line manager
must inform the tax authorities if an employee has moved from one canton to
another.
As
far as the role of HR is concerned, Kearney says staff at all levels have benefited.
"Admin staff have been trained in dealing with people, rather than
keyboards – they come in when there are specific problems to be dealt
with," he says.
"Before
this system was set up, we couldn’t answer a simple question like ‘What is the
staff turnover across the company?’ because each country had a different way of
deciding what this meant. It only took one computer to blow up in Kazakhstan
for the whole thing to be out. Now we have one system which works across the
world."
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Further
information…
–
Cisco Systems: www.cisco.com
– PriceWaterhouse Coopers: www.pwcglobal.com
– Oracle: www.oracle.com
– Hewitt Associates: www.hewitt.com
