Managing carbon-based assets with silicon.

Clive Longbottom, Service Director

Quocirca Comment
Although the main focus on enterprise software seems to be around customer relationship management (CRM) and enterprise resource management (ERP), one area that often gets overlooked is the effective management of the warm, squishy parts of the business – the employees. Sure, organisations will have systems in place, such as from Oracle or SAP, but these are often seen as the poor cousin to the ERP and CRM systems, with little strategic focus on the real capabilities required from an HR system. It’s all well and good having an excellent technology platform to log all interaction with suppliers and with customers, but if the human aspects of all of this means that your employees are running around like headless chickens and have little to no clue as to what is really expected of them, then your organisation will still not work well. No – software is required to look after the employees – but what does this mean and what should be the cornerstones of an HR software architecture? Remuneration In the first place, each employee will want to be paid. Surprising, but having money in the bank at a reasonably similar point of the month each month is pretty important to an employee, so that they can pay the mortgage, put shoes on the kids’ feet, have a stale crust and glass of water occasionally and so on. Therefore, payroll is a pretty important basic need. On top of this is expenses – Quocirca has just finished carrying out a research project for on-line expense management company, Concur which shows that the majority of organisations are still using manual systems to manage their expenses, such as a straightforward word processor or a spreadsheet. It is also apparent that the UK workforce is leaving around £330m per annum on the table in unclaimed expenses. Why? Existing systems are not flexible enough to allow for expenses where a receipt is not available, and so car park expenses, underground fares and the odd cup of coffee with a customer are being paid for by the employee directly. Does this matter? Yes – an employee who believes that they are funding the business themselves will not be tempted to go that extra mile for the business in other areas – expense management is the next thing that needs to be looked at. Next comes vacation and sickness management. Some companies will be working on a flexi-time model, where employees can work extra hours on some days and build up time off; some will be working on multiple shift patterns; others will be running a fairly standard 40-hour working week. All these variations on working pattern need to be allowed for. Everyone is entitled to time off, even if this is due to sickness, maternity or paternity leave – but where a person is off sick or is using up statutory paternity/maternity leave, this needs to be put through to HMRC as well so that payments due to the business itself can be calculated and paid back as applicable. An employee should be able to use a self-service portal to see what time they are allowed off and to request or book vacation time in a clear and easy manner. It should also be apparent that expenses, vacation and sickness management is also intrinsically linked to payroll, so trying to keep these areas completely apart with separate solutions will only lead to problems in making sure that everything does work together seamlessly. Expenses and salary should be paid at the same time for most people; any impact on salary through sickness needs to be logged in a manner that makes reporting this as easy as possible so that the employee, the business and HMRC can see what has happened throughout the year at a granular and, for the business and HMRC, an aggregated basis. Indeed with the latest changes to how pay is dealt with, everything has to be managed on a near real-time basis to meet HMRC’s RTI requirements.

Managing carbon-based assets with silicon.

http://www.quocirca.com

© 2013 Quocirca Ltd

Knowledge & Training Training is an HR issue, and systems need to tie in to ensure that each employee, contractor and consultant get the right training that they need according to the tasks and projects they are working on at any one time. This collective group of human resources also has a value to the business that few organisations are making the most of. Held in the heads of the people are thoughts and ideas on how a task or process could be carried out better, making the employee happier and probably saving the company money at the same time. Some of the people may have innovative ideas for new products or services which they are keeping to themselves for no other reason than they believe there is no way to get their idea to the business in the right way. Managing the training and intellectual capital of human resources is often referred to as human capital management (HCM), and has come on a long way from the computer-based training (CBT) modules and IBM Lotus-Notes based knowledge bases of old. Companies such as Imaginatix, Infor and Oracle offer systems that work around the concept of capturing ideas from employees and providing recognition to those who provide ideas that lead to a useful outcome to the business. Part of HCM is also around listening to the people involved and responding to their needs as appropriate. Companies such as Confirmit and Verint provide software that manages not only employee but also consultant, contractor, supplier and customer feedback and can be used to help in adding to the intellectual property base being built up in other areas of HCM. Getting people in and out The problem for HR software systems is that much of what they do seems like trying to herd cats and knit fog. Employee churn will happen – for a 1,000 user organisation with a 10% churn, 100 employees will leave and 100 will have to be taken on, just to stand still. If the organisation is growing at 10%, then an extra 100 people will need to be dealt with – that’s 300 adds and deletions that have to be accommodated – never mind all the amendments such as address changes, changes of surname on marriage and so on. On top of this are the more itinerant workers from the contractor and consultant pools: the overall impact for a modern business is in dealing

with thousands to tens of thousands of adds, changes and deletions (ACDs) to an HR system that each have knock-on effect throughout other systems. Recruitment also has to be a part of the overall solution. Indeed, if there is a need to bring on board 200 new staff per annum, it averages out as one person per working day. If each position gets only 10 applications, 2,000 people will have to be dealt with – and some jobs are attracting thousands of applications in today’s economic conditions. A further important part of any HR system is in managing those who are not direct employees. Most organisations now have a mix of employees, consultants and contractors working for them, and it is important to treat each one according to their needs. With such a varied and changing group of resources involved, HR also has to play a direct part in the rest of the technology environment. For example, as soon as a person is put into the HR system as a resource, this should set in place a whole raft of tasks that, for example, set up a computer account for them and provision the software services they will need to carry out their job, as well as a telephone account, security passes, etc. When they leave, stating this in their HR records should block their access to all the services they were provided with. The HR architecture challenge An additional problem is that the rules that underpin a lot of HR are driven by government legislation, and on-premise systems run the risk of being behind the times with what laws they use in their rules engines. On-line systems not only can be kept up to date more effectively, but the service providers responsible for them can concentrate on keeping them up to date with relevant laws and ensuring their software provides the correct support for them. HCM solutions are also moving to the cloud. The likes of Workday (which offers a more complete cloud-based HR offering), and SAP’s SuccessFactors offer intellectual property management systems based around ideation and jam sessions, with employee recognitions and other modules included, such as succession management to ensure that the loss of key personnel through resignation, sacking or other

Managing carbon-based assets with silicon.

http://www.quocirca.com

© 2013 Quocirca Ltd

causes does not have a massive negative impact on the business. However, if the decision is to go to a cloud-based overall HR solution, the main issue will be in pulling the various bits and pieces together in a manner that is seamless and yet still does effectively support the business. This is where cloud standards and application programming interfaces (APIs) are important – and is the areas where cloud is still at its most deficient.

This can cause issues when a company looks to using cloud as an overall solution, but should not be an insurmountable issue. Already, many will be using an external on-line service such as APT or Sage One for payroll, and the likes of Concur or KDS for expense management. Over time, it is likely that HR systems will become more cloud based and sufficiently well integrated. At the moment, it is key to identify where the interfaces between any chosen solutions are needed and concentrate on ensuring that these interfaces are managed in a manner that avoids any confusion and issues for the business. This article first appeared http://www.computerweekly.com on

Managing carbon-based assets with silicon.

http://www.quocirca.com

© 2013 Quocirca Ltd

About Quocirca
Quocirca is a primary research and analysis company specialising in the business impact of information technology and communications (ITC). With world-wide, native language reach, Quocirca provides in-depth insights into the views of buyers and influencers in large, mid-sized and small organisations. Its analyst team is made up of realworld practitioners with first-hand experience of ITC delivery who continuously research and track the industry and its real usage in the markets. Through researching perceptions, Quocirca uncovers the real hurdles to technology adoption – the personal and political aspects of an organisation’s environment and the pressures of the need for demonstrable business value in any implementation. This capability to uncover and report back on the end-user perceptions in the market enables Quocirca to advise on the realities of technology adoption, not the promises. Quocirca research is always pragmatic, business orientated and conducted in the context of the bigger picture. ITC has the ability to transform businesses and the processes that drive them, but often fails to do so. Quocirca’s mission is to help organisations improve their success rate in process enablement through better levels of understanding and the adoption of the correct technologies at the correct time. Quocirca has a pro-active primary research programme, regularly surveying users, purchasers and resellers of ITC products and services on emerging, evolving and maturing technologies. Over time, Quocirca has built a picture of long term investment trends, providing invaluable information for the whole of the ITC community. Quocirca works with global and local providers of ITC products and services to help them deliver on the promise that ITC holds for business. Quocirca’s clients include Oracle, IBM, CA, O2, T-Mobile, HP, Xerox, Ricoh and Symantec, along with other large and medium sized vendors, service providers and more specialist firms.

Full access to all of Quocirca’s public output (reports, articles, presentations, blogs and videos) can be made at http://www.quocirca.com

Managing carbon-based assets with silicon.

http://www.quocirca.com

© 2013 Quocirca Ltd

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