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B2E - business to employee - future trends
by Aarthi Ramesh
The latest, addition to the glossary of new economy terms is B2E and what is it? It is about Business to Employee, with the former empowering the latter with the help of technology like Intranet. Bijay Sahoo, General Manager, HR, Wipro Technologies and Hema Ravichander, Senior Vice-president, HR, Infosys shed more light on this at the E-HR conference organised by the Bangalore chapter of NHRD, on Nov 1-3, 2001.
Bijay shared his experiences with B2E Portals and illustrated how the HR division in Wipro was using technology to deliver service to its employees. He noted that workplace dimensions had altered over the years, "From being a closed economy, we have become a global work force. The definition of jobs is changing and people are giving more importance to family and life after work". The focus, he said, was moving towards enabling employee processes.
For a similar reason, the HR functions in Infosys was also globalised. Hema pointed out that the HR had to globalise, scale up and handle employees who wanted more information about the organisation and beyond. She said, "People are critical to any organisation and if they are well informed they are happy and happy employees are the best brand ambassadors of the company."
The Wipro Intranet, "Channel W" bonds 9500 Wiproites across the globe. It addresses all the areas that an employee needs - community, collaboration and care. The portal has affinity clubs, message boards, chat, Intranet search, personalisation engine and even a space for Wiproites to buy and sell stuff. It however is not just for fun alone.
As a knowledge-intensive company, which is growing at a rapid pace, it knows it must use the technology to manage and share this knowledge. The portal provides a framework that encourages and facilitates Knowledge Management. One section of Channel W is devoted to internal corporate communication, white papers, articles and knowledge and idea sharing.
"Sparsh", the Intranet where Infoscions get in touch with other, answers all FAQ's on income tax, company policies or security. "An employee can easily navigate to other department portals for information on training or leadership programs without as much as moving out of his cubicle", Hema said. There is also help available online to learn how to do things in the company. The 'Employee Data Sheet' allows the employee to update his personal information online. The 'Request Tracker' is an application where an employee can request for information or service. 'Connect Infy' is a referral-hiring scheme, which allows the employee to refer a candidate who he knows will fit the role.
Highlighting the benefits of an employee portal, Hema said portals were a big source of Knowledge dispersion. Bijay noted that, "A portal can provide employee self-service solution, act as a binding force across various HR initiatives and result in a clear, orchestrated and powerful HR strategy."
In his concluding remarks, Bijay further espoused the advantages of the B2E initiatives. He said, "Since the focus of HR has shifted from administrative to value added services, the B2E portals aid HR executives of the company to be available to employees and strategise. It reduces operating costs, improves awareness, employee feedback and communication". Hema, however pointed out that, "IT should enable HR, but HR should not lose itís human face."
Hi Rajat roopa here. thanx a ton 4 sending in the reply. the article was really very helpful. thanx once again. regards roops...!
What exactly you are looking for? There are many things to talk about on your topic. In each area of HRM, there is at at least one new contribution everyday.
Some of the recent trends followed in India are:
1. Competency Mapping
2. Six sigma
However it all depends on the need of the organization what to use or not to use. Thus be clear on what exactly you are looking for or at least the area.
We have heard about selection nterview. interview at the time of apparaisal as well as exit interview.However nowdays there is trend of Stay interview coming up in the industry.Where HR interview there emloyee and understand the level of satisfaction among them.
This trend has emerged becasuse exit interviews are like discussing married life after divorce.
Analysts, industrialists and academicians are of the opinion that a strategic mix of shared services and outsourcing is the new model that is driving HR teams in global organisations to achieve and sustain excellence. However, what is yet to be understood is whether outsourcing is really the pathway towards
attaining competitive advantage. Today, transformation of HR operations has shifted the focus from a traditionally reactive and administrative function to one that is tightly connected to the business. The effect of this strategy is significant in making it possible for businesses to respond to market and human capital changes more rapidly.
When AT&T enters into a seven-year outsourcing contract with Aon Consulting for combining the talents of its human resources and payroll organisations with Aon’s core competencies in employee benefits, compensation, employment and other services – what is their prime motive? Most certainly, the obvious answer would reflect the basic principle kkore on its core competencies.” Initially, outsourcing was done mainly to bring down costs, however, a changing feature of outsourcing today is that it no longer involves only low-key operations. Increasingly, services that are being outsourced are those that require highly skilled and qualified personnel who are able to provide the service quality standards required and this has led to a increase in the outsourcing of human resource services.
Today, human resource professionals are expected to deliver more advanced and differentiated human capital skill sets, create and maintain high performing workgroups, offer technology platforms with increased functionality and direct access to information as well as partner with business leaders to align people strategies with business goals in order to achieve corporate initiatives. Dave Ulrich, a leading scholar in human resources, recently wrote that the competitive forces that managers face today and will continue to confront us in the future demand organisational excellence. The efforts to achieve such excellence – through a focus on learning, quality, teamwork and re-engineering – are driven by the way organisations get things done and how they treat their people. Those are fundamental human resource issues. To state it plainly: achieving organisational excellence must be the work of HR. The
question for senior managers, then, is not ‘should we do away with HR?’ but ‘what should we do with HR?’ The answer perhaps is to create an entirely new role and agenda for the field that focuses not on
traditional human resource activities such as staffing and compensation, but on outcomes. HR should not be defined by what it does but by what it delivers – results that enrich the organisation’s value to customers, investors and employees.
In order to achieve its strategic business objectives such as initiate top-line revenue growth and shareholder value, management of human capital has become critical. The current rate of economic, competitive, and political change demands cost flexibility in all functions of business. The mandate for the HR function is to work better, faster and cheaper. However, this changing role of HR is perhaps not well understood by all.
A research done by Mellon Human Resource shows that it is only through a focused approach to ‘HR shared services’ that companies can accomplish the imperatives demanded of the human resource leader. Today’s organisation’s can no longer maintain the status quo in HR service delivery. HR no more identifies with its traditional reactive and administrative nature and there has been a clear shift in its focus to HR being very tightly connected to the business. The effect of this transformation is significant in making it possible for business to respond to market and human resource changes more rapidly.
Our new model for organisations today is an offshoot of the obvious understanding that the traditional model of HR does not align with the evolving demand to achieve organisational excellence. A common theme has emerged towards decreasing the size of the HR function while moving transactional activities “out” and, therefore, deploying fewer human assets to perform these activities by outsourcing, leveraging technology and creating common approaches, processes and practices. This role of HR shared service, therefore, affords more time to organisations that can be utilised for strategic issues.
Changing Role of HR This changing role of human resource is the answer to attaining a competitive advantage in the present market scenario, and this is reflected in the fact that more and more companies today are resorting to outsourcing of its HR services in order to keep pace with the competition and afford effective management of its human resource as a prime asset of the organisation. HLL (Hindustan Lever Limited) is perhaps one of the greatest examples of HR evolution. Being one of India’s oldest organisations with its traditional culture, Hindustan Lever has gone on to launch Hindustan Lever Network (HLN), a unique
network marketing opportunity that aims to be the most preferred business opportunity by partnering its consultants and providing them with a business and self-development opportunity that is truly rewarding.
As a result of this diversion, Hindustan Lever Network has identified the need to be excellent in every aspect. Since it’s core competency lies in business and products, HLN has started resorting to outsourcing of all other functions to devote more time to its strategic issues, reduce fixed cost and also initiate diversion of non-creative and non-business activities to outside agencies. It is this desire for excellence that it has led Hindustan Lever Network to acknowledge the growing importance of sharing human resource services. In this context, Hindustan Lever Network has approached Planman Consulting Group to outsource its entire training activities.
The Planman-HLN association which has been formed to outsource HLN’s entire training activities to Planman Consulting is one of HLN’s initiatives to make time to concentrate on its core functions. To illustrate further the contention behind this association, HLN does not have expertise or related research in training and development while Planman-IIPM not only has the necessary expertise and reosurces, but at the same time induces cost reduction for HLN as compared to the investments HLN would otherwise bear if they were to do this in-house.
Quite simply, adoption of this “new” model improves the ratio of human assets Over the years, a variety of models have been designed, considered and even implemented in an effort to achieve this transformation towards HR outsourcing. Perhaps most recognisable to HR executives is the seemingly constant swing between centralised and decentralised models. In the past, organisations believed they could benefit from economies of scales with fully centralised HR services. On the other hand, however, the gain in flexibility to meet unique business-unit requirements related to decentralised service delivery carries higher cost and duplication of effort.
Many organisations that have experienced this swing between centralised and decentralised operations are familiar with the results. One particular note is the belief of employees that the company lacks a common culture or brand. Instead, the heavily decentralised organisations find that business units create duplicate and contradictory HR practices, policies, processes and procedures. These differences across the company are not business requisites, rather the result of history, individual preferences and experiences. Shifting the focus of HR enables the organisation to direct attention on customers’ needs that include creating a company brand identity through leveraging economies of scale.
To realise the benefits of both models, companies are shifting to the shared service approach that enables streamlining of processes across multiple units or locations while maintaining customer focus.
This approach to HR-shared services becomes the critical lever empowering human resource leaders to support their businesses in a way as to advance the enterprise’s strategic objectives. The HR-shared services model has been employed by many leading companies to increase quality, improve service, and reduce processing cycle times as well as expense. For example, various human resource shared services models are found at IBM, Royal Bank of Scotland, Lockheed Martin, Warner Lambert, Hewlett-Packard, Sears and Boeing.
Efficient alright...but what about HR effectiveness?HR is about people, and it is a common perception that HR efficiency is directly related to how much you know about your people and of course, there is no better answer to that than in-house HR services. But the changing model lays emphasis not just on the efficiency rather the effectiveness of human resource. In the shared service scenario, non-strategic HR activities and specialised HR expertise are removed from the business unit.
The range of activities from transactional to HR expertise to business partners is vast. In our experiences to date, the majority of field-based HR staff have focused on the transactional activities, leaving little or no time available for partnering with the business or bringing depth of expertise around strategic human capital issues like employee development. Shifting transactional activities to technology and shared service organisations enables the organisation to take advantage of economies of scale and, therefore, affords the field-based human resource staff more time to truly focus on those activities at the business partner end of the spectrum.
Today, HR managers in the business units are increasingly called upon as strategic business partners. But what do we mean by a strategic partner? The future HR business unit manager’s role encompasses six key areas of partnership (leadership development, strategic business partner, employee relations, talent management, HR functional specialists and change management consultant).
To accomplish these new roles, most HR departments require fundamental change and growth of competencies. The Society for Human Resource Management (SHRM) Foundation completed an effort comprising many years of data collection with major global companies that included General Electric, Westinghouse, Citigroup, AT&T, PepsiCo, Mobil, Oracle, ICI America, LL Bean, etc. The research culminated in a detailed HR competency framework reported in 2000. The framework, which is divided into three domains – core, role specific and level-specific competencies – provides a powerful foundation towards achieving the necessary capabilities to achieve HR and organisational excellence.
The roadmap to human resource transformation is made up of many critical activities that serve to help organisations understand the current state, envision the future, build the model, validate the vision, and implement the new HR service delivery approach.
The advent of technological advances has made it possible for a shared services function to have immediate and accurate knowledge of local policies, procedures, employee history and special arrangements, thus enabling a centralised function to provide customised service rather than “one-size-fits-all” service.
Also, employees and managers are able to readily access and manage information without HR intervention. The use of direct access (sometimes referred to as self-serv-ice) is a key factor in the redistribution of activities performed by HR. Transactional activities are performed under a tiered service delivery model in which technology provides the first level of support to HR’s customers. A customer-focused service centre provides the next level of support and relatively few issues escalate to human resource specialists.
Our experience demonstrates that leading HR organisations are restructuring operations and leveraging benchmark data to set aggressive and achievable targets to reduce cost – but more importantly create long-term value. Successful transformations rely upon a combination of benchmark targets and better practices rather than any single measure.
Consulting firms such as Mellon Human Resource and Financial Services, An-swerThink’s Hackett Group and others have core capabilities in assisting organisations to identify the current HR operating cost baseline by analysing budgeted and hidden costs to deliver HR services. Executives must recognise the value of benchmark data in enabling solid decision-making that is tightly connected to the baseline data and benchmark comparisons. Targets for service improvement, cost reduction and efficiency in advancing HR’s role must be closely tied to the baseline data.
In fact, most of our clients today are heavily focused on targeting cost reduction while actually improving the quality of human resource service. Growing competition has changed the focus towards a more cus-tomer-oriented approach of doing business where excellence in customer satisfaction is the key to retaining one’s market share. Under such a scenario, it is evident that a lot of time needs to be invested in instilling a more customer focused approach.
The growing importance of people service in business today has made it imperative for organisations to resort to HR-shared service which promises a specialist’s deliverance of every human resource function. Business today has realised the essence of the people factor in organisations as being closely related to its strategic business objectives. The new model which Mellon Research proposes in this paper will perhaps prove to be a guideline for companies today to withstand the implications of facing the changing role of HR in business.
Although most organisations have recognised the need to make this change and, therefore, accept the new practice of HR-shared services, there is still a question regarding which human resource activity to outsource. The new model proposed herein clearly defines the correlation of each function and its effectiveness as a result of outsourcing. Excellence in implementation of this new concept is the key to ensure effectiveness of this change. It is not just about cutting cost but a pathway to leverage excellence in efficiency by way of HR-shared services.
The article is co-authored by Casey F. Thomas, Arthur Mazor of Mellon Human Resources and Investor Solutions, Boston & Rajlakshmi Saikia, Indian Institute of Planning & Management, New Delhi, India.
Thomas F. Casey and Arthur Mazor; Transforming The Human Resource Function Through Shared Services; Human Resources and Investor Solutions, Boston News release, May 29, 2002, AT&T Signs Outsourcing Agreement with Aon Corp.
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