Salarycom h rcom_ppttemplatemar2609_final

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Salarycom h rcom_ppttemplatemar2609_final

  1. 1. Is Disjointed Data Blurring Your View of Who to Retain or Fire?5 Steps to Gaining Application Clarity and Better Decision-Making Expert Advice from Paul D. Hamerman, Nora Costa and Nick Camelio March 26, 2009
  2. 2. Agenda• Introduction: Our Team of Experts• The Situation• The HR Dilemma• Common Pitfalls and Causes• 5 Steps to Fixing the Problem• Getting Executive Buy-In
  3. 3. IntroductionSalary.com presents the “HR Dilemma™ Series”• Fictional cases that present common managerial dilemmas...and,• Offer concrete solutions from experts on how to resolve them
  4. 4. Our Experts Paul Hamerman Nora Costa Nick Camelio Forrester Iron Mountain Salary.com ResearchLeading industry analyst at Forrester Director of compensation at Iron Vice President of Human Resourceswith nine years of experience specific Mountain, with over 25 years of and Talent Development atto business technology, evaluating: experience as a business & practice Salary.com, with over 16 years ofsoftware vendor mergers and leader in corporate HR, with proficiency experience providing HR leadershipacquisitions, next-generation in market pricing and skill- or to technology companies –architectures, industry-specific competency-based salary structure specifically in recruiting,strategies, & packaged application design. Industries include business compensation and benefits, learningdeployment models (including services, higher education, financial and development, and employeesoftware-as-a-service). services, healthcare, and software. retention.Expertise: Enterprise Applications Expertise: Compensation Management Expertise: Strategic HR Functions
  5. 5. The Situation: Drastic Loss in Jobs 2008 US Job Losses Totaled 3 Million Entire contents © 2008 Forrester Research, Inc. All rights reserved.Source: “Current Employment Statistics Highlights”, Bureau of Labor Statistics, March 6, 2009(http://www.bls.gov/web/ceshighlights.pdf)
  6. 6. The Spotlight on HR • Rising unemployment levels shine spotlight on HR • Personnel costs represent 35% of total operating expenses, on average.* – RIFs, hiring freezes, deferred raises, and bonus cuts are cost cutting measures in play. • Companies need to know: – Who to retain — top performers and scarce talent. – Which positions are variable for capacity management. Entire contents © 2008 Forrester Research, Inc. All rights reserved.* Source: PricewaterhouseCoopers Saratoga
  7. 7. Most Companies Don’t Know Which Employees to Retain, Promote, or FireQ: “We objectively know which employees we need to retain, which employees wewant to promote, and which employees we want to manage out of the organization.” Importance Capability Not at all 0% Poor 3% Below average 9% Below average 23% Average 12% Average 34% Above average 37% Above average 29% Extremely 39% Outstanding 9% Dont know/NA 3% Dont know/NA 2% Base: 100 HR decision-makers Entire contents © 2008 Forrester Research, Inc. All rights reserved. Source: July 2008 Global Talent Management Best Practices Online Survey
  8. 8. The Acme CompanyLeading Pharmaceutical Provider• 2,500 FTE• 3 Global Offices (UK, Singapore, Tokyo)• 15 US offices• Annual compensation budget is roughly $250 million• 15 Product Lines in US and 10 in Europe/Asia
  9. 9. Our Cast of CharactersClaire, VP of HR at Acme Co. Seasoned HR veteran with over 15 years of experience. Responsible for US and global HR operations for 2,500 FTE company. Has Team of 20 People. Working on consolidating two operating divisions via acquisitions; manages multiple homegrown and packaged point solutions.Mark, CFO at Acme Co. Fiscally conservative CFO. Responsible for HR, Legal and Finance operations. Believes strong balance sheet is crucial to company’s health. Believes in paying for results and strategic use of technology to improve business operations. Investing in sales initiatives to drive top-line sales growth inside US.
  10. 10. March 2008: Strategic Planning Mark and Claire review corporate objectives and set budget:• Aggressively recruit in new sales positions in US• Integrate 2 new acquisitions and critical sales positions in US• Implement aggressive pay-for-performance plan across globe• Build pipeline of strong leaders for key positions• Manage to specific cash flow targets per quarter
  11. 11. Business Environment Changes Underneath Strategic PlanTracking to goals Market Collapses
  12. 12. The New Corporate ObjectivesMark, CFO walks into Claire’s office:• Implement hiring freeze and reduce payroll by 15%• Must maintain high level of customer service, and...• Stay competitive in our key focal areas• Craft a plan to execute in next 30 days
  13. 13. The Patch ProcessClaire’s team scrambles to craft the plan and reviews that data shehas to work with: • 3 HRMS systems for headcount, positions and salaries • Excel-based submissions for remaining domestic offices – Multiple performance input across company • Performance ratings, potentials but no historical data • Paper-based job descriptions, development plans with no competency data
  14. 14. Aggregating Disparate Systems Compiling Org ChartsPerformance Reviews Multiple HRMS directories
  15. 15. Claire’s HR Dilemma & Opportunity• Claire must pull together a recommended methodology and list: – No standard core system of record; – Has to make over 5 phone calls to pull data requests across IT, Legal Compliances, HRMS directories, performance histories, learning updates & finance – Team works overtime to aggregate, organize and validate data. – Lack of executive awareness - most executives don’t realize they lack the ability and systems to pull the information together• How can she pull it all together so executive leadership can focus on the best methodology and process, ensuring they make the best talent decisions to achieve their business goals?
  16. 16. The Challenge: What Should Claire Do?Expert Commentary
  17. 17. Paul D. HamermanCauses and Pitfalls• Multiple core HRMS solutions, lack of global HR data• Outdated HRMS core system with manual processes• Processes optimized around payroll, not HR• Numerous best-of-breed solutions
  18. 18. Nora Costa• The pain of patching together a view• Turning the executive dilemma into an “aha moment”• Window of opportunity to educate and pitch to senior management and coordinate a plan that saves time and money
  19. 19. Nick CamelioAdministrative burden, time to patch vs. the focus onstrategic decisions – Pre and post reduction – How does unified data help through the aftermath?
  20. 20. Build Case for HR ROI5 Things You Can Do:1. Go to CFO with business case2. Calculate the cost of disjointed data • # of man-hours to pull/aggregate across functions • Impact of redeploying resources on strategic talent decisions1. Calculate the cost of multiple systems and vendors • # of people and vendors to manage • Cost to operate internally vs. leveraging SaaS options
  21. 21. Build Case for HR ROI …continued4. Quantify the impact of deploying best practices on CFO- metrics: • Revenue per employee and net income per employee • Reduction in operating expenses vendor consolidation, (SaaS) • Improvement in reporting • Lower employee turnover and replacement costs (time, $)5. Develop a coordinated HR Applications Roadmap and ROI
  22. 22. Total Economic ImpactTM (TEI) Framework for HRM Applications Strategy Entire contents © 2008 Forrester Research, Inc. All rights reserved.Source: December 19, 2008, “Building Your HRM Applications Strategy” Forrester report
  23. 23. HR Strategy & Roadmap Steps1. Develop a comprehensive HRM application strategy and business case. – Anchor this strategy to business drivers.1. Build around a core system of record and integration strategy. – Put in place a master data management strategy for people.1. Supplement the core HRMS with best-of-breed solutions where appropriate.2. Consider SaaS deployments to minimize upgrade headaches. Entire contents © 2008 Forrester Research, Inc. All rights reserved.
  24. 24. 5 Steps to HR Roadmap1. Assess/inventory the applications2. Analyze alternatives3. Determine target architecture4. Build roadmap5. Develop a business case for executives Entire contents © 2008 Forrester Research, Inc. All rights reserved.
  25. 25. Forrester’s 5-Stage HRM Applications Strategy Methodology Entire contents © 2008 Forrester Research, Inc. All rights reserved.Source: December 19, 2008, “Building Your HRM Applications Strategy” Forrester report
  26. 26. No.1: Assess Apps and Processes• Review HRM and business strategies.• Assess current apps and technology environment.• Assess process capabilities.• Determine gaps. Entire contents © 2008 Forrester Research, Inc. All rights reserved.
  27. 27. Illustration: Succession Planning Assessment Questions and Scoring Method Entire contents © 2008 Forrester Research, Inc. All rights reserved.Source: August 1, 2008, “Improve Strategic HCM Processes And Technologies” Forrester report
  28. 28. No.2: Analyze Alternatives• Categorize application needs into retain, add, replace, and enhance (RARE) buckets.• Determine candidate suppliers.• Evaluate deployment alternatives. Entire contents © 2008 Forrester Research, Inc. All rights reserved.
  29. 29. Retain, Add, Replace, Enhance (RARE) Entire contents © 2008 Forrester Research, Inc. All rights reserved.Source: December 19, 2008, “Building Your HRM Applications Strategy” Forrester report
  30. 30. No.3: Determine Target Architecture• Articulate the vision for HRM processes and technology.• Define functional architecture.• Identify technology characteristics and deployment methods.• Map integration and data management strategy.• Define reporting and analytics standards. Entire contents © 2008 Forrester Research, Inc. All rights reserved.
  31. 31. HRM Apps Functional Architecture Entire contents © 2008 Forrester Research, Inc. All rights reserved.Source: December 19, 2008, “Building Your HRM Applications Strategy” Forrester report
  32. 32. No.4: Build a Roadmap• Define apps and process priorities.• Determine project dependencies and timeframes.• Define the strategic apps road map. Entire contents © 2008 Forrester Research, Inc. All rights reserved.
  33. 33. Apps Roadmap Illustration Entire contents © 2008 Forrester Research, Inc. All rights reserved.Source: December 19, 2008, “Building Your HRM Applications Strategy” Forrester report
  34. 34. No.5: Develop a Business Case• Determine acquisition and implementation costs.• Estimate on-going ownership costs.• Estimate benefits.• Assess risks and flexibility.• Calculate Total Economic Impact™ (TEI).• Package results for executive approval. Entire contents © 2008 Forrester Research, Inc. All rights reserved.
  35. 35. Building the ROI Business Case• Use a five- to 10-year time horizon.• Understand the usage metrics – number of users, frequency and intensity of use.• Model SaaS costs against on-premise deployment, taking into account the full costs of on-premise upgrades, maintenance fees, internal support, and hardware.• Adjust for inflationary increases and the time value of money.• Factor in risks, time-to-value, and flexibility. – Faster deployment and lower up-front costs with SaaS – Higher implementation and obsolescence risk with on premise – Flexibility depends on specific solution characteristics Entire contents © 2008 Forrester Research, Inc. All rights reserved.
  36. 36. Total Economic ImpactTM (TEI) Framework for HRM Applications Strategy Entire contents © 2008 Forrester Research, Inc. All rights reserved.Source: December 19, 2008, “Building Your HRM Applications Strategy” Forrester report
  37. 37. Thank You for Attending Questions?If we do not answer your question during the liveevent, please feel free to send any questions toAlison Kelly: akelly@salary.com, with the name ofthe speaker your question is for, and we will behappy to get back to you!

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