Effectiveness Efficiency and Engagement of HR Automation
In last few years, I have developed my own unique process of networking with leaders and professionals across industries and it has worked efficiently for our mutual growth. I call it as “Service Model of Networking” as opposed to “Sales Model of Networking”. The “Service Model of Networking” doesn’t work on the basis of “revenue earned from every professional network”; instead, it works on “value addition” or “Unique Selling Proposition (USP) you bring to the table, it is much focused and creates win-win outcomes. Through “Service Model of Networking”, I don’t seek business from people in my network instead, I ask for their feedback on my work and my ideas that may eventually add value to their organizations. I believe, it is very engaging and at the same time non-irritating approach. It has helped me to reach out and develop a wonderful relationship with many CEOs and Managing Directors of small and mid-sized organizations (less than 5,000 employees).
Last year, in the month of March, I was contacted by the CEO of a mid-sized engineering organization headquartered in Gurgaon. The organization which currently employs 625+ employees is now considering few global acquisitions and is also planning to set-up a new plant in Pune. Till date, 15 employees were managing the Human Resource activities through Microsoft Suit, primarily MS Excel and low-level software for managing payroll. My initial conversation with the CEO indicated that he was not happy with the functioning of HR Team. He asked me about my experience and level of involvement in HR Automation Projects and if I will be interested in taking up a project with the organization. After I submitted my detailed response to him, he called me for a meeting at his office in Gurgaon. In a daylong meeting with CEO, CFO, and other stakeholders, we discussed the expected outcome of the project, commercials and budget involved, and a timeline to submit the project. As a part of the project, I was asked to evaluate their existing processes, suggest a cost-effective solution to develop software in-house or to purchase it from the market and get customized. I was asked to provide a list of best THREE HRMS available in the market if buying from outside or prepare a detailed project plan and help in getting it executed if opting for in-house.
Challenges Involved in Successful Implementation of HR Automation
- Process Owners Opposing the Change - Like any other change, this change was also furiously opposed by process owners. For them, automating processes implies learning new skills. If they fail to do so, they might risk losing their jobs. During my initial interactions with the HR team, they gave me numerous reasons as to why automation is a bad idea. One of the reasons was, losing “human touch”. Someone said, “We are working in HR Function, therefore, we need to understand feelings, emotions, and difficulties of our employees and resolve it accordingly. With automation, everything will become mechanical and we will lose a chance to interact with them and as a result, there will be high attrition”. Another HR manager said, “These people don’t know how to operate computers. They are too rigid to learn new things. It will increase the workload on HR Department”. Yet another member of HR Team blamed the leadership of the organization, “They never discussed it with us. That’s how they treat us. We work so hard, sometimes we work for 12-13 hours a day and yet they don’t involve us in decision making. They should have involved us in this decision as it was about our department before appointing you as a consultant and paying such a huge amount (I don’t know how they found about my commercial fee). We would have felt motivated had they given that amount to us instead of wasting it”. It took me a lot of time to convince them and show them an opportunity to grow and learn new skills. I also gave them an insight into how they can develop their career in HR and be more effective. I won’t claim that the entire HR team was convinced with my explanation and argument but 3/4th of the lot were.
- Running Parallel Systems–HR prefers to run parallel systems - manual as well as automated HR processes. Though they continue with the manual process as a backup plan to ensure functional continuity until the automation is completed and employees get enough training to use processes efficiently and effectively. However, the truth is that in many mid-sized organizations, they never really move to automation. I know few organizations where they manage time-office and payroll in MS Excel as well as in Software. The only way to move towards HR Process Automation is to completely shut-down the manual process and use the software efficiently and optimally. There might be few challenges in the initial months of implementation, may be 4-6 months, but after that, it will be easy to work. It will not only save the time but will also increase the accuracy. Don’t create a pain for lifelong if something can be cured with a hospitalization for 4-6 months.
- Inaccurate and Incomplete Database – For an automation of HR processes to work flawlessly, TWO things must be accurate and updated by minute – Process Flow and Database. If process flow and database are inaccurate and incomplete, then no matter which HRMS one uses and how expensive it is, it won’t give the desired result. Hence, it is a responsibility of HR to audit the database and process flow on regular basis, preferably on weekly basis. I remember one case where an employee was offered a salary of 360,000/- INR per annum, however, a manager who was responsible for adding details into the system, added 3,600,000/- INR per annum. As a result, the new employee received a salary of 300,000/- INR per month. After four months this error came into notice but by then the employee had already left the organization. There was another case of an employee receiving full salary for THREE months after leaving the organization because the person who was responsible for updating the database missed clicking a tick in the system. In order to maintain database confidentiality and determine accountability, it is important that database updating rights are given to few people only.
It took me 30 meetings, involving over 50 stakeholders, in a span of FOUR months to understand existing processes and gather information; challenges faced by HR team and leadership team and create a document and process flow diagrams. In the next phase of my project, I had to conduct a feasibility study and make recommendations. I conducted a one day workshop for the entire HR team on a theme “Changing Role of HR in an era of Automated Processes and Digitalization”.
The integral message of the workshop was to highlight following SEVEN benefits of HR Automation and the new role of HR Function –
- Saves Space–I visited one organization that employs 4,000 employees and is into business for last 20 years. They have rented a warehouse to stock lakhs of files which probably they will never use. When we automate HR systems, it saves space by eliminating or minimizing paper records and thereby removes the need for extensive filing systems and large storage areas, which in turn saves the organization’s money on rent and utilities. It also speeds up the process of document/information transfer as and when required thus saves postal and courier expense. It also eases up the audit processes conducted for various legal compliances or certification issuances such as ISO, CMM, PCMM, etc.
- Improves communication with employees across functions and geographies – I remember days when employees would walk down to HR Department, sometimes they had to wait in a queue to ask for information (leave balance, letter for address proof, interpretation of any policies, etc.), make a complaint (discrepancy in salaries) or get their queries resolved. With automation of HR Processes, leave records to get updated in real time, all policies are made available to employees, complaints can be raised online where they get a ticket number and a turn-around-time (TAT), and failing to respond within TAT automatically escalates the issue to a higher-up in the hierarchy. Process-flow has been set in such a way that an unresolved complaint gets escalated to CEO or Managing Director of the organization. Therefore, the automation brings in transparency in the system. Any announcement can be made instantly through the intranet. Communication becomes quick, effective and low-cost.
- Factual and Quick Decision Making - Automation of HR Processes enables Process Owners to create any kind of report and analytics thereby helping them to make every kind of decision. Through automation, any leader can access the information he requires while being at any place in the world without a necessity of exchanging emails with HR team members. HR Automation has helped managers to determine when and who to hire and what best methods are for employee development. Automation has allowed skill and competency matrices readily available to decision makers; hence, before looking outside for required skills and competence, organizations look within and hire talent within by ways of transfers, promotions, etc.
- Increases Productivity and Cost Optimization – As discussed above, with automation HR saves physical space required for keeping files and cost of employees required to maintain those warehouses and storerooms, communication becomes efficient, quick and low-cost; and quality and speed of decisions improve, thereby, increasing bottom-line profitability. HR Automation also saves the time of those who need to communicate with HR on regular basis. Time saved has a direct impact on resource optimization and increased productivity. Organizations are able to achieve more with fewer resources at a low cost. Accomplishing more in less time boosts morale.
- Effective Hiring – Managing Talent Acquisition in its manual format is one of the most tedious tasks, particularly when the organization wants to use multiple channels of sourcing. In talent acquisition, a missed or lost resume can be a very costly affair. It is important to collate all resumes for an open position at a single place, evaluate them thoroughly, share it with the hiring manager, and organize interviews in a timely manner. With an applicant tracking system, the hiring team can write a job description and promote it widely on job sites and social channels with just a few clicks. Qualifying questions automatically eliminates unqualified applicants and help uncover the best job candidates. It accelerates the recruiting processes and allows the recruiting team to focus on interviews and deliver outstanding candidate experience. Also, by reducing administrative work, the recruitment team will be able to cut costs and add to the bottom line of business.
- Performance Management–Next to recruitment, the most critical HR function is effective performance management and in the dynamic business environment that we are living in, KRA’s of employees change several times in a year, employees need regular feedback to keep a track of their performance, and coaching and mentoring should be given to those who are lagging behind in their performance targets. Discussing performance once in a year can be suicidal. Automated employee performance management tools make it easier for managers to give feedback and easily manage performance review. Automated performance management system allows HR to provide descriptions of ratings, especially for job skills, and forces managers to use a prescribed rating scale that helps in improving the consistency of ratings. Thus, employees perceive the process to be fairer.
- Development of Bench Strength and Succession Planning– With automation, it becomes easier to manage available skills and competencies in the organization more efficiently and effectively. Employees become aware of skills and competencies they need to move to the next level. They can apply for any open role within the organization with a fair knowledge of their probable success rate. HR can help the organization create a learning centre to prepare a talent pool of high-potential and high-performing employees to ensure business continuity.
With automation of major HR Processes, the role of HR Professionals in an organization has changed dramatically. It is no longer transactional, administration or activity based. It has moved more towards Business Partnership. Those HR Professionals who like change, who are quick learners and adaptors, not only managed to survive in this profession but also moved to never before seen levels of an organizational hierarchy and got promoted as CEOs, Managing Directors and Country Business Heads. On the other hand, those who resisted the change and were slow learners have either moved to other professions like sales, digital marketing, customer services, etc. or they are still working in similar roles in lower salary bands. To remain relevant and successful in HR, when major tasks are getting automated, professionals in this function must develop following competencies –
- Leadership Development & Business Continuity – Help the organization in identifying high-potential and high-performing employees; facilitate leadership development programs; coaching leaders and managers to develop competencies required for high impact and high-risk roles, and correcting behaviours or employees that are hindering their growth potential. This role of HR not only requires them to focus on high-potential and high-performing employees but also give attention to low-performing and low-potential employees. Help low-performing and low-potential employees get aligned with business goals and strategies. If they don’t improve as per the requirement then Talent Managers must recommend Leadership Team to eliminate such employees from the system. By doing so, HR Professionals will help the organization in creating a culture of accountability, performance, and rewards. It will also ensure business continuity.
- Inculcating Winning Behaviour among salesperson – Till a few years ago, it was assumed that HR cannot play a significant role is Sales and Marketing. However, now scenarios are changing. As Digital and Social Media has begun to take a centre stage in our lives, HR can certainly play an important role in product or service Marketing, Branding, and Positioning. Of course, they must have Business Acumen, and be well versed with organizational offerings. Also, as Behaviour Scientists and Performance Coaches, HR can play a significant role in developing a competitive edge among salesperson of organizations.
- Analytical with reasoning and logic – With process automation in place, HRs are now sitting on huge data, which can now be analysed and used effectively in taking decisions. Today many organizations are looking for metrics or analytics in HR which are not just related to people but also on processes such as recruitment, retention, compensation, succession planning, benefits, training & development, performance and appraisal and many others.
- Effective Communication and Employee Engagement – With several of HR processes getting automated, now HR has plenty of time to get innovative with employee engagement and ensure that every employee of an organization is aware of organizational mission, vision, goals, products, and services. They can also ensure that every employee is able to see the significance of his role in the big picture. HR is now free to play a significant role in preparing an effective communication strategy and plans to address needs to all stakeholders based on the mode of communication preferences of every social group taking into consideration cultural barriers.
It took me TEN months to complete the project and submit my reports. It was a wonderful experience. While studying their existing HR Processes, I also got a chance to analyse their office administration process, and believe me, those were very tedious, time-consuming and expensive. The organization could have saved millions of dollars per year by streamlining those processes. Having understood their existing processes, growth plans and expectations from HR, it was discovered that there is no single software that can address every requirement of this organization. Therefore, I recommended them - Workday or Ceridian (Dayforce HCM) for addressing their Talent Administration needs and Cornerstone OnDemand or Ascentis for their requirement of Talent Management in multiple locations.
I am a strong believer of a fact that automation of HR processes is not a threat to HR Professionals working in this profession. Instead, it allows them to free up their time and make a significant contribution in areas where it matters. In coming years, I foresee organizations coming up with more innovative tools and software to address challenges of Talent Acquisition, Performance Management, and Talent Development. There is a huge scope for further automating HR processes. With automation, the role of HR will evolve further and it will get closely aligned with Business Strategy, Profitability, and Customers.