joanna harrop, hr expert speaker at hr summit and expo 2017 "efficient and cost effective hr...
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Efficient and cost effective HR HR Operating Models, Integrated Lean Six Sigma and HR Technology
Joanna Harrop
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Joanna Harrop M.B.A., M.A. Cass Business School, City University of London, United Arab Emirates
The University of Manchester, United Kingdom The George Washington Business School, United States
Joanna Harrop is a Human Resources expert with 16 years of managerial experience gained in global NASDAQ 100 and FTSE 100 corporations based in England and in the United Arab Emirates.
Joanna worked in all areas of HR and developed a particular interest and expertise in organisational change and development supported by an effective and cost efficient HR performance. Her HR recommendations were cited in professional CIPD publications and the Middle East Journal of
Business. She can be contacted on [email protected].
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Objective
This presentation will provide a brief guidance on key aspects determining the effectiveness and cost efficiency of HR in organizations.
It will highlight the role of the correctly implemented and aligned with the rest of the business HR operating model, the importance of an effective work methodology (Integrated Lean Six Sigma) and the importance of deployment of HR technology.
It will provide an ample proposition of tools, metrics and monitoring systems, which when used enhance effectiveness and cost efficiency of HR.
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Human capital has been recognized as an organization’s greatest asset and the main source of competitive advantage.
Thus, companies focus on EFFECTIVE and COST EFFICIENT HUMAN RESOURCES in order to reduce internal costs and enhance business profits.
Deployment of HR technology enables effective and cost efficient HR services.
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HR OPERATING MODEL
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Effective and cost efficient HR Operating Model:
• Creates common framework for HR processes
• Is adjusted to the specific needs of the organization
• Maintains standard controls and compliance
• Allows for a greater degree of outsourcing and offshoring (if needed)
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HRT
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D. Ulrich model should be aligned with what organizational needs, examples:
A large number of HRBP, global HRSS combined with HR help desk but no
CoE because HRBP are required to be able to solve all HR issues.
HRBP for all main departments with a specific operational expertise, CoE and HR help desk with a shared payroll. No
HRSS.
HRBP, global HR help desk and HRSS and 3 tier CoE: global, regional and local levels)
HRBP, regional administrative service centres and HR help desk together but
with payroll executed locally. No CoE, as Leadership Team with HRBP and Strategy
Unit make all decisions.
HRSS for global operations combined with CoE, HRBP and local payroll.
HRBP with Talent Development Specialists placed in individual busines units. HR
Strategy Consultancy Unit and global HRSS.
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Watch out!
Three key limitations that prevent the model from fully supporting the HR efficiency and cost effectiveness:
(1) Limited HR Shared Services communication with the rest of the business
(2) Incorrect use of metrics and measurements within the organization
(3) Lack of participation of line management (non HR roles)
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Limited HR Shared Services communication with the rest of the business
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Watch out!
Most frequent problem areas:
- HRBP overburdened with transactional workload.
- HRBP general understanding of business operations and strategy (training needs assessment).
- Lack of use of technology for regular meetings/updates directly with the entire business.
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Incorrect use of metrics and monitoring within the organization
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The use of metrics and measurements within the organization:
• Correct implementation of a clearly-defined people strategy.
• A strategic alignment matrix.
• Identification of core competencies.
• Human capital metrics.
• Balanced Scorecards (Norton and Caplan) and Key Performance Indicators.
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Correct implementation of a clearly-defined people strategy
The HR People Strategy
↕
Organizational Effectiveness
▪ Is the HR strategy aligned with organizational goals?
▪ Are we building future workforce capability?
↕
Employee Engagement
▪ What is the opinion of internal clients about the HR service?
▪ Are the employees able to contribute an extra competitive advantage?
↕
HR Programs Effectiveness
▪ Are the HR programmes delivering planned results?
▪ Do various departments collaborate on the HR programmes?
↕
HR Function Effectiveness
▪ Is the HR function cost-effective?
▪ What are the future investments into Human Capital development?
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A strategic alignment matrix will guide the correct measuring of identified individual core organizational competencies against the organization’s performance level and allow specific action plans to be established.
Organization’ Core
Competency
Strategic Importance
(1 = not important, 5
= very important)
Organization’s
Performance Level (1 =
very poor, 5 = very
good)
Priority
(Low,
Mediu
m or
High) Action Plan
e.g.
Client experience 5 4 High Performance
Incentives.
Attrition/Turnover of
Staff 5 3 High
1. Employee
engagement
questionnaire. 2.
Revise: Recruitment,
induction processes.
3 Phases of
performance
management. 4.
Opportunities for
development
etc.
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The core competencies should be identified and scored cross-functionally by management in all organizational departments. The scores need to be placed in the strategic alignment matrix, which clearly highlights areas for urgent action.
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HCM Drivers Leadership Practices
Employee
Engagement Knowledge Accessibility Workforce Optimization Learning Capacity
HCM Practices
Communication.
Management’s
communication is open and
effective.
Job design. Work is
well organized and
taps employees’ skills.
Availability. Job-related
information and training
are readily available.
Processes. Work processes
are well defined, and training
is effective.
Innovation. New ideas are
welcome.
Inclusiveness. Management
collaborates with employees
and invites input.
Commitment. Jobs are
secure, employees are
recognized, and
advancement is
possible.
Collaboration. Teamwork
is encouraged and
enabled.
Conditions. Working
conditions support high
performance.
Training. Training is practical
and supports organizational
goals.
Supervisory skills. Managers
eliminate barriers, provide
feedback, and inspire
confidence.
Time. Workload allows
employees to do jobs
well and enables good
work/life balance.
Information sharing. Best
practices are shared and
improved.
Accountability. High
performance is expected and
rewarded.
Development. Employees
have formal career
development plans.
Executive skills. Senior
executives eliminate
barriers, provide feedback,
and inspire confidence.
Systems. Employee
engagement is
continually evaluated.
Systems. Collection
systems make information
easily available.
Hiring. New employees are
chosen on the basis of skill;
new hires complete a
thorough orientation.
Value and support. Leaders
demonstrate that learning is
valued.
Systems. Leadership
development and transition
systems are effective.
Systems. Employee
performance management
systems are effective.
Systems. A learning
management system
automates aspects of
training.
Human Capital Management matrix (Bassi, I., and McMurrer, D.)
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Lack of participation of line management (non HR roles)
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Lack of participation of line management (non HR roles):
• Better training on HR (soft skills, HR processes and HR technology)
• Improve ways to communicate with HRBP / HRSS
• Identification of possible other issues affecting engagement
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Examples of tools to help in Identification of issues affecting engagement:
• Hackman and Oldham’s Motivating Potential Score (MPS) tool
• Surveys, 1:2:1 and Gemba Walk
• McGregor, L. and Doshi, N. tool
Source: hbr.org ׀ November 2015 Primed to Perform in McGregor, L. and Doshi, N. “How Company Culture Shapes Employee Motivation”.
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INTEGRATED LEAN SIX SIGMA
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Integrated Lean Six Sigma is a methodology based on two main concepts:
• Zero Waste
• 100 % Engagement
Both of the concepts support the HR department in achieving and sustaining effective and cost efficient HR.
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Zero Waste
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There are three criteria for determining what adds value, adopted to the HR zero waste perspective:
• Employee must be willing to wait/pay for the activity.
• The activity must be done right first time.
• The activity must effectively change the HR process, product or service.
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Ways to reduce waste and make HR processes effective and cost efficient:
• Detailed process maps (assists with deselecting waste steps).
• Value stream maps (assist with change).
• Systematic performance monitoring and management.
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Detailed process maps assist with:
• Deselecting waste steps
• Transparency of the cross functional cooperation of the HR functions
• Setting correct measurements / monitoring e.g. SLA (based on time required for each step)
Receive HR request
Review HR request
Update HR system
Receive external information
Update HR system
Raise requisition to Recruitment
Update HR system
Update HR system
Request calculations from Payroll. Prepare document
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Detailed process maps help to clarify the process for everyone involved.
Usually there are at least 3 version of the same process:
(Source: The Rise Global, Process Maps)
There is a Technology available that can assist in creation of the process maps !
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Value stream maps: can be used for HR service delivery waste reduction during transition/change periods:
• Create a current state map showing how the HR services serve employees today.
• Create a future-state map showing the reduction of waste and the effects of the changes.
• Develop and implement a plan to reach the future state.
• Prepare new process maps.
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Systematic performance Zero Waste monitoring among others provide:
• Dash Boards comparing: daily, weekly, monthly, quarterly etc. results e.g.. SLA, KPIs.
• Metrics monitoring fluctuation of work volumes.
• Metrics monitoring absenteeism.
Aims to provides REASONS for the above and detect and forecast TRENDS
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100 % Engagement
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Ways to achieve HR and operational excellence through 100% People Engagements (in Integrated Lean Six Sigma):
1. Basic IL6SG Training
2. Daily Management System
3. Hoshin Planning
4. Gemba Walks
5. Kaizen Ideas Programme
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Basic Integrated Lean Six Sigma training to all employees assists in implementation of continuous improvement culture, which improves effectiveness and cost savings.
Sets the transparency of what is expected and the CI mindset.
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Daily Management System are routine 10 minute long morning meetings:
• Review of KPIs status from the previous day
• Propositions for improvements to exceed KPIs
• Requests and comments from the HR administrative/operations team
• Identifies issues that require root cause analysis
Aim is to:
• Engage and empower the workforce in proposing improvements
• Focused and result oriented culture
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Hoshin Planning deployment allows for management of objectives. It is a 7-step process used to succeed in 3-5 year plans. It eliminates the waste that comes from inconsistent direction and poor communication.
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Gemba Walks allows the manager to observe the real job on the shop floor level in order to look for waste , opportunities to improve processes and engage with the employees.
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Kaizen Ideas Programme offers rewards and recognition for system improvements.
Reinforces the culture of continuous improvement where all employees are actively engaged in improving the department / company’s operations.
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TECHNOLOGY
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The HR Operating System and Integrated Lean Six Sigma depend on deployment of HR Technology for efficiency and cost savings:
• HR Data Management
• HR Requests / Enquiries
• Cloud technology:
- talent and development programmes
- e-HR technologies, intranet, apps and etc.
- communications, meetings/updates with the entire business.