Making Cent$ of HR Shared Services Technology: Part II

Peter Alkema

In part I, we considered the five-pillar HR service delivery model as a means to focus HR technology investment on customer expectations and group various HR technology offerings within a meaningful model:

  • Pillar #1: Portal
  • Pillar #2: Knowledge Base
  • Pillar #3: Acquisition
  • Pillar #4: Self Service
  • Pillar #5: Case Management

Using this model helps assess requirements and opportunities for HRT to deliver on the value proposition of a shared services in a way that most meets the needs of its customers.

Which of the requirements that we examined in part I is more important? Which requirements in the five pillars should receive the prioritized share of limited resources, time and budget? The three most prevalent functions in an HR Shared Service provide some insight. [1]

  • HRMS / Personnel Administration (more than 80 percent)
  • Call centre / employee enquiries (more than 80 percent)
  • HR Analytics & Reporting (more than 78 percent)

Administration of personnel requires core HR technology in place to manage leave, payroll, employee benefits, etc. The service delivery component of this is self-service, which implies a core (back-office) HR Management System that is transparent to employees but physically interacted with through self-service. Call centers and employee inquiries require case management to be in place so that queries received can be managed within SLA and tracked through to resolution and employee satisfaction. Often there will be a telephony component and very advanced, large scale HR shared services will also feature integrated CRM capabilities. HR analytics is not a service to employees, but a management tool and is intrinsically linked to whatever technology is in place – typically this will be a data warehouse plus presentation layer.
Finally, we consider some industry trends and vendor strategies for each component of the 5-pillar HR service delivery model in a shared service environment:

Pillar #1: Portal

  • About 3/4 of medium to large-scale HR shared services have an employee / HR portal in place, with nearly 20 percent of the rest planning to implement one in the near future. The majority of those in place are built on existing HRMS / ERP HR solutions, while 20 percent are on sharepoint. More than 30 percent are built internally or externally on other platforms.

Pillar #2: Knowledge Base

  • Automated knowledge management is less prevalent, and less than a third have one implemented. Sharepoint is the clear leader of these solutions. Quality of search engine is usually the differentiator between solutions – while the ability to use employee information in the search algorithm is also critical.

Pillar #3: Acquisition

  • Although onboarding orchestration is not a mainstream shared service function, the supporting technology should be integrated, and customer service reps will often have to support recruiters and line HR functions in its usage. Effective streamlining and automating of otherwise manual and paper-based processes is a key differentiator of solutions, while it is also critical to minimise hand-offs between systems.

Pillar #4: Self Service

  • Benchmarks indicate that up to 66 percent of queries should be resolved without escalation to HR shared service experts and consultants. This requires world-class "Tier 0" service delivery where an employee can transact and retrieve information on their own without support. Self-service solutions are usually composed of manager and employee offerings with rollout plans for each one dependent on the implementation strategy.

Pillar #5: Case Management

  • Just over half have a case management system implemented, with nearly 30 percent planning to implement one in the near future. Best practice ratios for successful case management implementations are around one customer service representative to every 1000 employees. This requires a user friendly, scaleable and widely deployed solution that provides advanced analytics and SLA management.

Technology and HR shared services must integrate effectively by focusing on the core service delivery components and applications that improve the centralised value proposition. Most companies focus their initial efforts on core personnel admin, query management and analytics. Talent acquisition, knowledge management and portal technologies are also widely available and solution in these areas can dramatically enhance a centralized HR service offering.

In this article, we have used the five-pillar service delivery model as a framework. We noted important challenges in each and how these translate to real requirements for the technology to not only deliver on, but also build an opportunity to over-deliver on its investment. A prioritization of these assists in a limited resource environment, where we saw that employee admin and queries are most critical. Finally, we have looked at vendors and industry trends that inform the strategic planning for HR Technology to deliver successfully in shared services.

Next month's article will unpack each of the five pillars from an architectural point of view. There are many systems and applications that would have to be in place. These are often transparent to non-technical users, but important to understand and be familiar with – as long as they are described in non-technical language!

Next month's article: "HR Technology... in Layman's Terms."

[1] 2011 HR Delivery Practices Survey – Shared Services Institute