Steve Foster, Director, KPMG Consulting will be leading the first Breakfast Briefing at Softword (Day one 09.00 – 09.45) on Selecting the right HR and Payroll system for your organisation. Here he considers the future of HR technology.
HRMS, e-HR and B2E
As you wander around the Softworld exhibition, you will doubtless see some very impressive software, the result of tremendous developments in technology over the last few years. Indeed, many basic HR systems now offer the same level of functionality as the most powerful systems of 5 years ago. For example, many new systems are capable of e-HR, the ability to deliver some HR services through Employee Self Service (ESS). But what’s next for HR technology? This article looks beyond e-HR to the next stage of evolution in HR technology – Business-to-Employee (B2E), likely to change the HR landscape beyond recognition. It’s worth bearing this in mind as you plan your own implementation.
It’s about how I do my job
e-HR concentrates on traditional HR transactional activities, such as changes to personal details, training and recruitment administration, compensation planning and benefits administration. The obvious benefits of e-HR include simplifying HR administration, reduced operating costs and freeing up HR time. However, while the focus of e-HR is on administration, B2E is concerned with performance – creating the high performance workforce. Organisations tend to create barriers to performance because the systems in place which are intended to help people perform their jobs (such as e-HR) usually operate in fragmented, functional silos. The high performance workforce needs more than just HR processes on its desk – it needs knowledge tools, communications tools, collaboration tools and learning tools which support the way people work. e-HR is only one component of this.
In simple terms, B2E is about one thing : How people do their jobs. It addresses how the organisation uses technology to provide the tools, information, processes and services which help people perform better. When employees have the right tools for their jobs, they feel better able to make decisions, are less frustrated and feel more valued. The evidence suggests that high performance companies use web-enabled administration extensively and are quick to take advantage of eAdministration tools, integrated collaboration tools and management information applications. Recent research by Cranfield University confirmed that high performing organisations are extremely good at exploiting B2E technologies and implementing new work practices. The use of B2E technologies sets high performing companies apart, because employees are more in control of their work, more responsive to customers, more flexible and better at adapting to change.
B2E is a one stop shop
Effectively, B2E technologies are clusters of applications, presented to employees through a single ‘portal’. This ability to connect related internal processes is at the heart of B2E. For example, there is an important relationship between individual performance, skills/competency development, training event attendance and delivery tools such as eLearning. Often, these tools are standalone systems, each of which has to accessed separately. In a B2E world, seamless links can be created between these applications, ensuring that the outcome of the performance assessment links to training registration and specific on-line training with minimal administration. B2E also includes personal expenses reporting; often seen as a Finance Department administrative function, on-line expenses are part of the toolkit which employees need to perform their jobs. Improved employee performance means that internal procurement activities (laptops, company cars, business cards etc) should also become part of the B2E landscape. Other tools include knowledge management, communications and collaboration tools.
One critical, defining factor for B2E is that access is through a single entry point, where each person needs only one logon ID and one password to obtain total access to the full toolkit. The portal is essentially an access layer, under which the various components reside, so totally integrated the effect is like having a single enterprise system where data flow is seamless.
What’s it got to do with HR?
B2E has important implications for the HR function. The most obvious is the opportunity presented by B2E to automate core HR processes, reduce costs and improve service levels. If HR is to help the organisation improve employee performance (rather than just running administration) B2E presents a great opportunity.
A B2E approach has two major implications for the future role and use of HR technologies. The first is that the HR system must become very tightly integrated into the entire workforce-facing suite of applications, and not just exist as a standalone system. This provides transparency and consistency of data, and enables single access. The second is that the data held in the HR application will become very valuable, since it will become source data for a much wider range of applications, providing core data for permissions, access rules and policies – for example, storing authority limits for e-expenses or purchasing approvals. The HR system is the engine that drives B2E.
Traditional concepts of the HR ‘system’ therefore need to be re-defined, so that HR technology is seen as an organisational resource, rather than just a means of managing personnel administration. At the very least, the HR function is likely to involved in the introduction of B2E, given the change and cultural implications involved in implementing new technologies.
As technology becomes more sophisticated and organisations recognise the business benefits, B2E technologies will become part of the core toolset which enables and supports improved performance across the enterprise. The convergence and integration of these technologies around performance issues – rather than departmental administration – will be at the heart of a people-focused, high performance company.
