HR: Delivery Underpins Strategy
The increasing demands on HR are often preventing it from influencing corporate strategy as effectively as it could. ExcellerateHRO's Kathryn Kelly tells Jim Banks that employing an outsourcing partner can free HR resources to deliver a world-class service.
The key goals for global business players are performance and growth, and more companies are realising that neither are achievable without leadership from human resources. From sourcing talent in emerging markets to aligning human capital with corporate strategy, HR has become vital.
Nevertheless, HR is all too often seen as a cost centre, rather than a source of value. This, along with decades of regulation and tightening labour markets, has constrained HR's effectiveness and kept it out of strategic planning.
However, the need to find and train the right talent is becoming paramount. This is especially true with customer service becoming a key differentiation as employees are increasingly seen as extensions of products or services.
Kathryn Kelly, president of HR outsourcing service provider ExcellerateHRO, says: 'HR has never been more important, so companies need strong delivery. Unfortunately, many HR organisations spend the majority of their time on delivery issues – including thousands of transactions, from payment and training to promotions and performance management – rather than the strategic contribution of HR.'
HR leaders typically operate in two very discrete worlds: the very strategic arena of talent management and global expansion and the tactical and costly world of HR delivery. Fragmented systems infrastructure, poor data inventories, frequent exceptions, inadequate self-service tools and disarray among vendors often draw a disproportionate share of the attention to delivery.
FROM THEORY TO PRACTICE
Kelly believes that optimising HR delivery can free up resources to manage HR at the strategic level. However, this requires clear targets and effective tools, and this is where an outsourcing partner can help.
She explains: 'Investing internally is expensive and provides little return. Outsourcing service providers make continuous investments and their clients pay less. HR delivery can generate tremendous value and we have identified some key attributes of HR that lead the way.' She believes the hallmarks of worldclass HR delivery are:
Consumers are comfortable with self-service, internet commerce. HR functions could benefit from similar interfaces to replace costly, lengthy and often inaccurate manual processes.
Technology enables high levels of personalisation, improving accuracy and user satisfaction. Targeting HR information, such as healthcare policies, to be relevant to each employee could dramatically improve efficiency.
Work or life events, such as having a child, affect HR issues, including eligibility or benefits. HR transactions can be consolidated around such events, making it easier for an employee to see which HR actions are required as a result of a particular event.
HR can be fragmented, especially after a merger or acquisition, but should be rationalised and monitored continuously to ensure regional compliance. Outsourcing providers add value by leveraging their investment in compliance monitoring across multiple clients.
Companies require language and cultural skills to provide service and support across many markets. Outsourcers can again leverage their investment to provide global reach at a more reasonable cost.
Labour cost arbitrage is key, but there is concern in HR about service quality in low-rate markets. A thoughtful approach could see significant backoffice work handled offshore.
STANDARDISATION AROUND BEST PRACTICES
Identifying where business processes and workflow differ between countries can highlight instances where standardised practices can be applied to different markets.
LEVERAGE AND SCALE
The ability of outsourcing providers to leverage an investment across multiple clients enables faster, cheaper scaling.
STATE-OF-THE-ART INFRASTRUCTURE (SECURITY AND SERVICE)
Maintaining and upgrading a network and its security applications can be expensive. Outsourcing providers can add value by spreading costs across multiple clients. According to ExcellerateHRO, these attributes will ensure better HR delivery, allowing companies to focus time and resources on people and programmes that foster prosperity and growth.