Technology systems are now an essential requirement for any modern HR department, but rolling out a system that can integrate effectively with every part of the business can present a significant challenge. Angus Kidman talks to two companies about how they dealt with the challenge of integrating HR applications into their overall business systems, and identifies some key principles to ensure implementation is successful
Technology systems are now an essential requirement for any modern HR department, but rolling out a system that can integrate effectively with every part of the business can present a significant challenge. Angus Kidman talks to two companies about how they dealt with the challenge of integrating HR applications into their overall business systems, and identifies some key principles to ensure implementation is successful
When it comes to application integration, there are two fundamental approaches: an all-in-one package that can handle all of a business’ needs, including financial planning, human resources and customer interaction, or a series of separate applications which are connected as required. Many businesses find themselves working with the latter, not so much by choice than by the gradual accumulation of different technologies that creates a formidable challenge whenever upgrades are needed. Others elect to install a single system, but still face the issue of trying to incorporate older data into the system.
A fundamental challenge for many organisations is how to integrate data from multiple business applications. Victorian electricity distributor Powercor addressed that problem in 1997 by implementing SAP’s R3 system to replace its existing mainframe and legacy applications.
“It was a big bang implementation that went across everything,” says Tony Matheson, SAP applications manager for Powercor. “One of the key reasons we selected SAP was that we could get all the information in one place.” Having a central system was much simpler than trying to integrate separate applications for different divisions, Matheson says.
Powercor created a permanent SAP development group within the organisation. “Having a dedicated SAP team was a key strategy,” Matheson says. “That has meant that when we are looking at new things, we have a focus on whether than can be done within SAP. It keeps it simple and it keeps it integrated.”
For Powercor’s HR requirements, the shift to a centralised platform had several benefits. “Because we’re predominantly a rurally-based organisation, communications with employees are paramount,” says Leanne Carson, manager for HR and organisational change. “We’re looking for technology which saves our employees time.”
Efficiency was also paramount. “We have a very small HR group for the size of our organisation,”Carson says, with two recruitment and one-and-a-half payroll staff dealing with 1,500 employees, including around 700 field workers.”
An early project for HR was the implementation of an employee self-service system, which was rolled out in 2000 and handles payslips, overtime and leave requests. Locked-down PCs were deployed to field service sites, and paper-based payslips and forms were eliminated in favour of an electronic system.
That represented something of a cultural challenge. “There was a bit of resistance, but we had an employee who went round to all of the sites to explain the changes,” says Mark Hosking, senior SAP business analyst for the company. Making overtime requests only available on the system provided an additional incentive for employees to familiarise themselves with it.
More recently, Powercor has completed a project to automate recruitment authorities. HR data is also essential to many other applications within Powercor, since information on organisational hierarchies is utilised in many other workflow applications.
A common issue for such business-wide implementations is ensuring that IT communicates efficiently with other departments. Powercor recognised that challenge early on, and handled it by appointing existing business executives to the SAP team rather than outside IT experts. “It was a planned strategy that the core project team were extracted from the business,” Matheson says. “We learnt IT after having learnt the business.”
Hosking had a background in HR before working with the SAP team, which enhanced his understanding of the relevant issues when rolling out new systems. “What is really important is that there’s been a close link between business – every aspect of the business, not just HR – and IT,” Hosking says.
Maintaining that level of cross-company involvement and involving all players from the business is crucial to any large-scale project, Matheson says. Selecting the best available staff is also vital, even if that temporarily impacts on other areas. “It’s very important to get the best people on your project,”he says.
The need for executive-level support of IT is well recognised, but it’s also vital to educate lower layers of management on the benefits of new projects. “You need to get middle management support,” Hosking says. “There’s a productivity drop in any new large system for a period of time before you get the benefits, and that can be tough for managers.”
That process should not end with rollout either. Powercor has regular user group meetings every two months to enable staff to identify issues with existing systems and discuss new projects.
Heating up collections
One of the biggest challenges for any human resources system is keeping track of an ever-evolving employee landscape. Queensland-based mercantile agency Collection House addressed that problem in a novel but highly effective way: by expanding the software already used in its IT support desk and corporate compliance activities to manage HR issues as well.
The company’s receivables management offerings include debt collection, credit reporting and business information services, all of which can be combined into a single end-to-end service for businesses. Delivering that service involves more than 650 staff spread across multiple sites, creating a considerable challenge for the HR division.
“Until just over a year ago, the HR department used a combination of email and manual paperwork to log and track internal calls and personnel changes,”says Collection House chief information officer Matthew Thomas. “As the company grew, those processes proved increasingly unwieldly, causing data integrity problems, inefficiencies and sometimes resulting in the delay or misplacing of requests.”
Lack of integration with other divisions was also a problem, especially when staff shifted between departments. “If a member of staff changes department, HR needs to lodge a request to update the user’s details and permission to access various parts of the network. In the past, the transfer occurred manually by retyping the information from HR into the IT system, which often led to a double-up of entry requests,” says Thomas.
To solve this problem, Collection House looked to FrontRange Solutions’ HEAT call tracking system, which was already being used in several other departments, including IT support, accounting and finance management, and the corporate compliance division, a particularly critical element in the financial services sector.
“The initial implementation of HEAT within the technologies department had a dramatic effect on the department’s processes and task management,” says Thomas. “Other departments were able to see HEAT in action and determine how best the solution could be applied to resolve their own particular needs.”
HR was the fifth department within Collection House to implement a logging and tracking system using the software. “It’s customised especially for the HR department’s use,” says support desk manager Jim Bradburn.
In-depth consultancy with the HR department ensured that the system closely matched the business’ needs, Bradburn says. “The HR department is getting a lot of benefits from the system. If they want to find something, it’s much easier now.”
Usage of HEAT is continuing to expand, with plans to add new forms covering areas such as annual leave and, eventually, to build a full employee self-service system. “We are moving more and more towards a web-based interface,” Bradburn says.
The tracking system is providing an important integration function for Collection House. “HEAT is almost a component in a larger workflow process that is capturing information via web forms and transferring that information on an inter-departmental basis according to the nature of specific tasks and requests,” Thomas says.
While the IT department has benefited from only having to manage a single software package, there are no plans to further combine the separate departmental offerings. “It’s more convenient for us to manage different logging and tracking systems than have one centralised system,” Bradburn says.
What advice would he offer to other companies planning to travel down a similar path? Careful planning and assessment is vital. “Ensure that you evaluate the system carefully and check that it manages your requirements,” Bradburn advised.
Getting senior management buy-in is also critical to overcome resistance from staff. “There’s normally a champion who sees the overall vision and the benefits, but others can be afraid of change.”
Such resistance often results from fears that systems will eliminate jobs. Bradburn argues that such concerns are generally unfounded. Greater efficiency ensures that everyone can focus more on truly useful tasks.
Having evaluated and selected a system, it is important not to cut corners on the implementation phase. “It’s essential to get proper training and consulting,”Bradburn says. “Unless it’s implemented properly and actually embraced, you won’t get the benefits.”
Finally, don’t allow an enthusiasm for technology to eliminate the central focus of such integration projects: making the business run more efficiently. As Bradburn points out, “IT projects should be business process projects.”
