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Sector/Discipline/ the way we see it

Alliance

New Model, No Army

How the credit crisis provides the perfect catalyst to


radically redesign HR

We think we’ve cracked it! There is a percentage of managers concerned


viable alternative to the Ulrich model with redundancy processes,
that is capable of delivering higher outplacements, talent attraction and
quality HR Services at a better price. retention and the reengagement of the
How? By applying a set of technology remaining workforce has also spiralled
enabled design principles and by not upwards. HR is under pressure and
being afraid to kill a sacred cow or the old model (usually a version of
two. Our view is that it should be Dave Ulrich’s model) is consistently
possible to move the HR employees to being found wanting:
staff ratio from 1:100 to 1:250 or
better. Centres of Excellence – Are often
proving to be little more than Centres
Background of Nothing Special (CONS) containing
Delivering HR services is palpably a rag tag mixture of good people who
more challenging given the current we didn’t know what to do with when
global economic crisis. The percentage we did our last organisational HR
of employees concerned about job restructure in the 90’s;
insecurity, lack of career opportunity,
career ethics and lack of reward has
skyrocketed. This puts much greater
pressure on those tasked with
delivering HR services.
Likewise the
Shared Service Centres – Are often Trend 1 – A Global Credit Crisis – infrastructure and improving the
failing to deliver on the promise of 2009 has provided an object lesson in quality of the service in someone
more for less due to inherently poor austerity in Financial Services – else’s lap. As a result there are now a
process design and technology. This discretionary spending has been growing number of providers who are
is often compounded by having massively reduced, cost optimisation offering pay per use HR services. Our
completely opaque charging structures is, predominantly, the only game in research indicates that there isn’t an
and no understanding of the town and particularly in the Retail HR service that you can’t currently
requirements of the business; Banks all efforts are focussed on purchase from the “cloud”.
restructuring. HR must contribute to
HR Business Partners – Are still this agenda – both as an enabler for Trend 3 – Advances in mobile
running around delivering tea and the business and as a source of cost connectivity - Traditionally most FS
sympathy and wading their way reduction. To date in 2009 the HR businesses and their cousins in Retail
through the administrative tasks. departments in FS have been flat out have claimed an inability to move to
Despite all the talk and exhortation supporting restructuring and have yet “online” delivery of services to
few have been able to act as strategic to review their own operating models frontline staff due to a lack of access
business advisors to the businesses in line with the new cost saving to technology - particularly in the
they serve. Perhaps not surprising as imperatives (usually a COO driven branch environment in Retail
many were personnel managers who 20/30% reduction). When they get to Banking. This has ensured a “thicker”,
have simply changed job title. it they will discover that trying to hybrid HR model than the traditional
“shave” 20% off the current model Ulrich version which is predicated on
Add into the mix the new imperative will leave them well short of the the ability to self-serve. However, with
for many businesses to reduce both COOs requirements. A radical the massive advances in mobile
the cost and size of the HR solution is a must. The other relative connectivity, making internet access
department itself and all the elements certainty is that this new austerity will through handheld devices an everyday
are in place to catalyse a revolution in be a consistent theme for at least the occurrence, it seems misguided not to
the HR model. next three years. The silver lining is revisit the options for self-service that
of course that necessity is the mother these advances make possible. The
The good news is that in our wide of invention – new low cost models biggest barrier to this inevitable shift
ranging discussions with senior HR will emerge. is often the relatively entrenched
executives we think we have seen the positions of central IT functions who
future. The absolute design is not Trend 2 - The emergence of cloud “worry” about security and loss of
defined but we think we know the technology – The ‘00s was the ERP control. On closer examination these
principles behind it. decade. Most FS businesses invested “worries” are based on integrating new
heavily in ERPs to ensure that they mobile solutions with very old (‘80’s
The bad news is that history and had reliable and secure sources of & ‘90’s) technology systems – this
evolution tells us that those who are data, to ensure they reduced rework issue goes away when you open up
slow to leap to a new model will be in data entry and as a catalyst to the rent it from the cloud option.
handicapped. Slow adaptation is not a streamline and standardise processes.
viable option - natural selection in However, 15 years on and despite the Trend 4 – Web 2.0 and social
Financial Services is now a very rapid promises from the big ERP suppliers, networking – The 00s has seen the
process. If your plan for survival is a it appears we have yet to come across general public embrace the
safe implementation of the Ulrich the pot of gold at the end of the capabilities of Web 2.0 at a much
model, start worrying! rainbow. Mirroring the challenges of more rapid rate than most established
delivering hi-tech military solutions, businesses. Whereas individuals in
So what has changed to enable the rate of change of technology often their private lives think nothing of
us to see the New Model? renders aspects of the ERP systems searching the Web for information,
There are five major trends that will obsolete and in need of frequent advice, expertise, goods and services
each impact HR but when taken expensive upgrades. The advent of we have been remarkably slow to
together they have the power to “cloud” computing provides an adopt a similar mentality inside our
transform the current HR delivery alternative. The “cloud” enables businesses. In fact many organisations
model. Together they represent the businesses to “buy” infrastructure have banned access to the Web and
Perfect Storm that will impact HR services from 3rd party suppliers social networking sites – often using
over the next decade transforming it which are accessed via the web – the pretext of security, when the real
entirely. paying only for what they use, when issue is often the ability of old IT
the use it and leaving the systems to deal to provide the
responsibility for upgrading the processing power required. The gap
Capgemini Consulting the way we see it

between private and corporate The New Model So what can HR departments in
experience and expectation has now And what does all this mean for the FS do as a starting point ? A
grown to such a size that the pressure future of the HR army? If you flow few thoughts…
is really on businesses to provide new with the trends and apply the new If ‘centres of nothing special’ are not
access to sources of help, advice and model principles you quickly move to going to bring excellence, then buy-in
service a model where by you purchase pretty the service you really need or
much all of your HR services from outsource provision. There is already
Trend 5 – The maturing of HR external providers – probably accessed plenty of choice in the marketplace.
outsourcing – the 00’s has seen an through either a handheld mobile
inevitable improvement in both the device or via a portal on the laptop, In many shared service centres the
quality and quantity of HR leaving only a couple of HR roles only thing really shared is the
outsourcing services available. This behind and vastly reducing the HR premises. Co-location can make some
enhanced maturity has ensured that headcount. savings but don’t stop there. HR,
price, commercial flexibility and finance and IT can share a lot of
quality continue to improve. The old And the 2 roles… processes to improve quality and cut
mantra of you can’t control what you cost. And if banks become utilities,
don’t own is now looking very Firstly the holy grail of a truly delivering a highly regulated
redundant as in many cases the level strategic HR Business Partner becomes homogenous service, basic support
of service provision is proving reality. The business partner owns a requirements will be identical so you
superior in the outsourced mode. list of services, and drives innovation could share with competitors.
This trend will only continue to move by bringing new ideas to the business Explore new options.
in an improving direction. as service options.
Outsourcing contracts wisely entered Outsource all your recruitment and
into should hold no fear. The second HR role is the buy the people you need. Re-invent
procurement specialist who delivers talent management to find what really
Taken together these trends generate a you best value in what you buy and makes your top talent tick, so you can
new set of operating principles that ensures it is capable of being delivered specify exactly what you want. You
supercede the current model via a mobile device or portal and can be very specific - there will be
assumptions. This makes change manages the supplier contracts and plenty to choose from.
inevitable - we suspect we should now relationships.
only be talking about the scale and And finally, act like a business. If a
the pace of the change. See Figure 1. pilot exercise fails, abort it quickly
rather than the usual HR approach of
assuming patience will bring
improvement. Try something else as
Figure1
the 2009 version of financial services
is not prepared to wait for results.
Current Model Assumptions New Model Principles
But don’t just take our word for
Ownership ensures instant Instant access ensures instant
it …
access access
In a few of the early adopters of the
new HR model we are starting to see a
Quality service comes from Quality service comes from
move towards a far more agile and
customisation configuration
‘composite’ HR function with the
growing adoption of software as a
Only “our people” can Smart people understand our
service (SaaS) solutions. But to date
understand our business business
we have only seen people take a few
baby steps – the giant leaps are yet to
Cost effectiveness is about Cost effectiveness is
come – but they will come.
reducing Opex – Capex about reducing Capex and
expenditure is a necessary evil maximising the return on Opex
In June this year Siemens took the
significant step of signing a global
Only “our people” can Smart people understand our
enterprise subscription with
understand our business business
SuccessFactors for their Talent
Management suite of products.
Ultimately these products will service

Sourcing van IT in de publieke sector


www.capgemini.com

420,000 employees in 80 countries This is a global company opting to


and in 20 languages. utilise a cloud solution for the ‘value
add’ aspects of HR rather than further
“Our board has a global vision which deploy their incumbent ERP solution
is a worldwide strategic focus for us – and it wont please the ERP
today,” said Mrs. Horstmann, Head of providers. But once the technology is
Corporate Human Resources, Strategy outsourced or hosted then why not
and Leadership Development of the resources as well?
Siemens AG. “SuccessFactors will be
instrumental in helping us achieve And in conclusion
these core objectives by closing the So the new mantra for HR is really
gap between strategy and execution. It “rent it, configure it then reconfigure
will also enable us to globalize onto a it”. Pay for what you really need and
single platform, clearly separate only when you need it.
strategic execution and management
from transactional HR.” In the past we have referred to a
concept of ‘thin HR’ but in the ‘no
Mr. Kleinjohann, head of CIT, said army’ world of financial services HR,
“The Enterprise Cloud Computing it becomes positively skeletal.
business model is a strategic direction
for us. It not only lowers IT costs, and
creates faster end to end processes,
but can also grow with our
requirements both globally and
locally.”1

1 http://www.successfactors.com/press-releases/
detail/?id=1297042

About Capgemini
®

Capgemini, one of the world’s Capgemini Consulting is the strategy and


foremost providers of consulting, transformation consulting division of the
technology and outsourcing services, Capgemini Group, with a team of over
enables its clients to transform and 4,000 consultants worldwide. Leveraging
perform through technologies. Capgemini its deep sector and business expertise,
provides its clients with insights and Capgemini Consulting advises and
capabilities that boost their freedom to supports organizations in transforming
achieve superior results through a unique their business, from strategy through to
way of working, the Collaborative execution. Working side by side with its
Business ExperienceTM. The Group relies clients, Capgemini Consulting crafts
on its global delivery model called innovative strategies and transformation
Rightshore®, which aims to get the right roadmaps to deliver sustainable
balance of the best talent from multiple performance improvement.
locations, working as one team to create
and deliver the optimum solution for More information is available at
clients. Present in more than 30 www.capgemini.com/consulting
countries, Capgemini reported 2008
global revenues of EUR 8.7 billion and
employs 90,000 people worldwide.

Rick Freeman Andy Crossey


Senior Vice President Vice President
Capgemini Consulting Capgemini Consulting
Head of Financial Services Head of HR Consulting
Tel. +44 (0) 870 904 5529 Tel. +44 (0) 870 238 8958
rick.freeman@capgemini.com andrew.crossey@capgemini.com

Capgemini Consulting is the strategy and transformation consulting brand of Capgemini Group. © 2009 Capgemini. No part of this document may be modified, deleted or
expanded by any process or means without prior written permission from Capgemini. Rightshore® is a trademark belonging to Capgemini.