6 reasons why HR transformations fail
In an earlier blog post we identified HR transformation as an "integrated, aligned, innovative, and business focused approach to redefining how HR work is done within an organisation so that it helps the organisation deliver on promises made to customers."
We also discussed the fact that many international corporations are facing challenges in their HR function and the fact that on the administration side, HR admin tasks are often duplicated across Business Units and Countries – diverting focus from strategic HR tasks.
We subsequently identified the 6 main reasons or so called ‘derailers’ why HR transformation efforts often fail:
Enablers of HR transformation
Now let’s focus on the key enablers of any successful HR transformation. The International Public Management Association for Human Resources (IPMA-HR) has conducted several studies on HR transformation and according to them the key enablers of a successful HR transformation are as follows:
Organisational culture alignment
Interestingly, HR shared services is often expected to be named as a tool for HR transformation, especially due to the number of organisations having already shared services models in place. However, as you can see from the above shared services are definitely more readily acknowledged than outsourcing, but it still seems to lack visibility as a tool for HR transformation.
Whenever planning to transform HR, Mercer suggests a slightly different approach though. In order to facilitate a smooth transition from the current to the ideal state, Mercer believes that the cultural element should be more emphasised. Mercer has found that it is critical to involve top management in the process of identifying the desired outcomes, measuring the current culture and identifying actions to close the gaps between the current and the ideal state – a model named by Mercer as “Organisational Culture Alignment”. In this model, Mercer measures 5 cultural dimensions and 18 sub-dimensions, as illustrated below:
Accenture's enablers of HR transformation
Accenture on the other hand believes that the key cornerstones (enablers) to successful HR transformation are as follows:
- An Enhanced HR Organisational Structure: Standardisation of process and policy across the organisation is one of the tenants of transformed HR and often requires a significant review of existing capabilities. Standardised processes form the basis for efficient service delivery to all staff and the development of reliable and trusted interactions with the customer base. Alongside the required access systems, effective and standardised processes provide HR leadership with a means of assessing and revising process and policy in a flexible manner based on the changing needs of the organisation.
- An Efficient "Customer Service Oriented" Service Delivery Model: The most fundamental change as part of transforming the capabilities of a traditional HR organisation is the implementation of a revised service delivery model. This model lays the foundations for the changes in the way that HR relates to the business and how HR serves the wider departmental population on a more transactional basis. The model requires some fundamental changes in the outlook and behavior of HR as it transforms into a "customer service" focused operation. Likewise end users of this service are required to interact with HR (via the Shared Service Centre) in a very different manner.
- Common Processes and Policies: Standardsation of process and policy across the organisation is one of the tenants of transformed HR and often requires a significant review of existing capabilities. Standardised processes form the basis for efficient service delivery to all staff and the development of reliable and trusted interactions with the customer base. Alongside the required access systems, effective and standardised processes provide HR leadership with a means of assessing and revising process and policy in a flexible manner based on the changing needs of the organisation.
- Integrated HR Information Systems: Information management systems for transformed HR programs are often built on to existing department ERP solutions. Especially significant is the use of a case management system that provides for a single view of the customer and their interactions with HR. This ability to manage and handover cases to case workers is key to the way in which services are provided. The ability of customers to access the same data and have a shared view of HR interactions is vital. Equally, the use of a smart knowledge and document management solution is central to the ability of HR staff to access data quickly and reliably and to make use of standardised, corporately held procedural documentation and advice.
Another HR Transformation Survey conducted by the Shared Services and Business Process Outsourcing Association (SBPOA) in association with EDS has on the other hand identified the key enablers for successful HR transformation to be as follows :
75% of respondents mentioned executive management and sponsorship were most important
66% of respondents stated the quality of leadership as being very important
50% of respondents felt having a clear vision, strategy, detailed plan and scope of services is crucial
40% of respondents mentioned the internal processes supporting transformation such as communications, training, getting employee commitment and capability are critical
31% of respondents said solid technology platform was very important
As you can see despite the common belief only a minority believes that a solid technology platform is the most important enabler to successful HR transformation!
From all of the above surveys and insights it should become apparent that - regardless of the study and consulting firms’ beliefs - the overwhelming enablers for successful HR transformations could be summarized as follows:
HR transformation conference
Effective HR services can be delivered through any channel – in-house, outsourced, centers of excellence, and others. HR practices in 2011 saw Cloud application, multi-sourcing and SaaS trying to innovate business models, improve service levels, and control costs. World class organisations are seeking to make optimum use of these new capabilities as part of their HR Transformation journey.
But best-in-class HR operations are still a long way off, considering that organisations have new options of deployment models (public, private, and hybrid clouds), as well as of service models (SaaS, platform as a service, and infrastructure as a service). The benefits vary in terms of efficiency, availability, scalability, and speed of deployment. Best-in-class HR functions will be attained when captive and outsourced HR operations, with the best suited deployment or service models, influence business outcomes effectively and deliver decision support and demonstrable bottom-line impact.
About the authors
Dave Ulrich is a leading authority on leadership and Human Resources, ranked by Business Week as the #1 management educator and by Forbes as one of the top five business coaches in the world, and is the expert when it comes to HR.
Navid Nazemian is a global Human Resources professional and university lecturer. He is passionate about making the connection between the corporate world and academia in order to enable individuals, teams and organizations the best they can be.