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New Horizons, Part II

The second half of our report from the 9th Annual HR Technology Conference and Expo®

Friday, December 1, 2006
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Last month, we wrote about some of the highlights from the 9th Annual HR Technology Conference and Exposition,® which took place Oct. 4 through 6 at Chicago's Navy Pier and featured a record-breaking attendance of 1,900 HR practitioners.

This month, we continue our post-show coverage with a recap of the closing keynote by consultant Naomi Bloom, along with reports on breakout sessions that examined everything from selecting the right learning management system and the current state of the HR outsourcing market and what to look for in a new recruiting system.

Next year's show will also be held at the Navy Pier, on Oct. 10 through 12. Be sure to log on to www.HRTechnologyConference.com for details.

Bloom: Trust, But Verify

Naomi Bloom delivered the conference's closing keynote with her trademark outspokenness, urging her audience not to be "stupid."

"A lot of us are afraid of getting older," said Bloom, managing partner of Bloom & Wallace, a technology consulting firm in Fort Myers, Fla. "I'm not -- I'm afraid of getting stupid. And it's really easy to get stupid."

The subject of Bloom's talk was the need for HR leaders to be more discerning and skeptical when evaluating potential software purchases and to test the software via "scenarios" that reflect their organizations' mission and culture to ensure a proper fit. Bloom defined stupidity as "a willingness to believe what you're told by someone who is trying to sell you something."

"That doesn't mean you shouldn't trust the people trying to sell you something," she said. "But you need to verify what they're telling you. There's no cure for stupidity, but we can certainly treat it. And the treatment that I recommend is facts, a lot of hard work and a general air of skepticism."

Scenarios can be more effective than standard requests-for-proposals because many vendors have figured out how to craft "boilerplate responses to the boilerplate RFPs that the consultants prepare," said Bloom.

"The only way -- the only way -- to know what software does is to scenario-test it," she said. "There's no RFP in the world, however brilliantly conceived and beautifully answered, that's going to tell you one jot about the reality of how that software works. Now, there are absolutely places where it's appropriate to use RFPs. But the hard-core understanding of what software does can only be understood by demonstration."

Testing scenarios allow potential customers to "look under the covers" and see if software actually does what it's intended to do, said Bloom. In order for such scenarios to be effective, however, they must reflect the everyday tasks the organization faces, she added. "If you know what you're really trying to do [in terms of what you want the software to do], then being able to illuminate the differences becomes quite important."

Bloom described one scenario a company might use to test a staffing solution: A new hire arrives at the office on Monday morning, having already gone through the company's orientation procedures, received a company laptop, cubicle assignment, etc., and is officially "an employee." The person leaves for lunch that day and never returns. How does the staffing system cope with that?

"If it requires a mammoth amount of activity to unravel things, that's not good," she said. "If you've got an off-boarding process that's really intended for people who've been there for awhile, but the system won't let you stop the process even if the person was only there for 12 minutes, that's not good.

"It's terribly important that a delivery system be consistent with the policies, practices and the values your company is trying to put into place," said Bloom. "But you'd be amazed at the HR management delivery systems that make no sense whatsoever for the company they're trying to serve."

HR executives also shouldn't delude themselves into thinking that so-called "on-demand" or "software-as-a-service" products (software hosted on a vendor's servers instead of licensed to the client) will make it easier to obtain the services they need or change the software if it simply isn't delivering, said Bloom.

"If the software's no good, or it doesn't meet your needs or isn't as advertised, then, regardless of how you access it, you're still not going to get what you want," she said. "Even software delivered via SaaS is difficult to replace if it doesn't work out. It's just not that easy. So it's worth the up-front effort to test it first."

The LMS of Tomorrow

At the session "What You Still Need to Learn About Learning Management Systems," Josh Bersin, CEO and principal of Oakland, Calif.-based Bersin & Associates, shared some key highlights of the new frontier in such systems.

Unlike the corporate universities of five and 10 years ago, he said, "the new LMS is moving toward being totally integrated into the organization; no longer will learning involve providing employees with a place to go."

Unfortunately, though the university model may be obsolete now, many companies are still using it and need to move to performance-oriented, process-centric and measurable "learning services that come to you," he said.

With demands growing for workforce performance in today's business environment, using an LMS needs to be a core HR competency, but picking the model that's right for your organization requires due diligence and preparatory research, Bersin said.

Walking his listeners through his three organizational models for training -- centralized, federated and anarchy -- Bersin pointed out that most companies follow the second model, with learning applications and programs running independently, in silo formation, throughout. "Many companies would like the centralized LMS model, but the vast majority of them don't have the structures in place for success."

The goal of every future system, he said, "should be to integrate performance-management competencies with training competencies in a more centralized model."

Good candidates for such models, he said, are companies wanting to consolidate information and reduce overall training expenditures, those with highly customized systems that no longer can be upgraded and those whose vendors are not providing adequate support or research and development on the products.

On the other hand, companies that should postpone such a change would be those with no financial resources for a centralized system at this time; those still dealing with decentralized training budgets, control and authority; those with no shared-services experience or organization; and those for whom the cost of implementation, integration and support does not yet justify the potential savings.

"If the business doesn't feel enough pain to undergo such a massive IT project, it isn't worth it," Bersin said. "Sooner or later, however, it will become an imperative change."

 

Buying into Talent Management

Getting buy-in from senior leadership and operations is crucial to a successful HR technology implementation, said Brian Bohling, senior vice president of human resources for Hess Corp., the $23 billion energy giant based in New York.

Bohling offered that advice at a session in which he explained how his company adopted an integrated talent-management suite to accommodate the company's needs for a global workforce -- ranging from third-shift workers at gas station/convenience stores throughout the northeastern United States to petrochemical engineers in Jakarta, Indonesia.

"We have a very complex and very diverse workforce on a global basis, so for HR tech, [the question is], 'What's going to work?' "

The answer for Hess, he said, was a combination of Authoria's talent-management suite and mySAP enterprise resource planning software from SAP.

Hess needed a new system because the company faces an uphill battle in the war for talent, due to the scarcity of certain skills and the unappealing nature of some of its more remote global operations. It also needed to do massive entry-level hiring to compensate for an aging workforce and was saddled with a diverse array of HR technology systems that failed to interact effectively.

The first step to creating a new system was engaging senior leadership's buy-in to the program, he said. If the leaders attempt to "duck" in their support, he refuses to go forward, Bohling said.

"If you are not going to support me or give me money, don't ask me to do it. You have to have both," he said, noting that if senior leaders don't lend their support in a conference room when the program is being discussed, then they probably won't support the new system when the front-line managers attempt to push back against the changes.

In addition to the buy-in from leadership, Bohling worked hard to get the entire workforce engaged by including operations personnel in the planning of the new system. Five of the eight people on the planning team were from operations, he said.

"I told my boss, 'OK, so it took an extra 90 days but now it's going to get executed and implemented.' "

Dealing with Disaster

In a session on disaster recovery and emergency planning, Joel Ronkin, executive vice president and chief administrative officer for Miramar, Fla.-based Elizabeth Arden Inc., advised those attending to "expect the unexpected, because it's going to happen."

Regardless of whether an organization has facilities in hurricane-prone areas, such as South Florida, or is simply concerned about the terrorist attacks and power outages that can happen anywhere, having a thorough, well-tested emergency plan in place is essential to ensuring disasters don't create havoc for the business, Ronkin said.

He suggested HR leaders ask the following questions in preparing a plan:

* Who should be on the emergency planning team?

* What are the "priority one" systems that must remain in working order during a disaster?

* Is there a need for a tiered preparedness plan for disasters that last longer than three to seven days?

* What lines of communication will be used for both employees and customers once a disaster has struck?

Ronkin noted that when Hurricane Wilma struck Florida and affected one of the company's facilities, management found a hotel room and set up operations there to ensure payroll was processed. "We never missed a payroll," he said.

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Bill Hicks, chief information officer for Weston, Fla.-based Ultimate Software, which performs HR and payroll services for Elizabeth Arden, added that companies need to think about three things: Who needs to go? Where do they need to go? And what is needed in terms of technology and computers?

Thinking through the process, "we realized the need to give more people laptops," he said. "Employees can go to Orlando and pretty much work in any hotel" in the event of a disaster.

During the presentation, Hicks pulled out a wallet-sized laminated card that included the contact information of everyone he was responsible for. "It was a simple solution" to ensure people could be reached, he said.

Don't Forget the Managers

Integrating performance management and learning management systems -- with the integration of succession planning in the works -- "gets everybody on the same page" about aligning individual and business goals, said Marquam Piros, director of performance management for Scotts Valley, Calif.-based Seagate Technology during a session he presented along with Dave Watkins, CEO of Softscape, based in Wayland, Mass.

That integration was especially important to Seagate, a global disk drive manufacturer, Piros said, because the business has been built through acquisitions, resulting in an abundance of legacy systems.

Previously, the company had multiple, manually tracked learning management systems and paper-based performance management systems, while succession planning was "a buddy's name in a drawer." Nothing was tracked or linked together.

When it comes to implementing a new system, he said, it's important to "make it easy for the managers. If we are not making it easy for them, they are not getting engaged with us."

Keeping a proper perspective is also important, said Watkins. He noted that HR professionals spend their days focused on issues such as learning management or performance management, but for managers, such issues may take up only 10 to 15 minutes a day. "Systems need to be transparent. They need to make sense. And they need to be easily understood," he said.

At Seagate, Piros said, people-management issues are given the same priority as profitability, innovation, customer satisfaction and growth.

A Buyers' Market No Longer

The HR outsourcing landscape has changed a great deal during the last few years, with the biggest change being that it's no longer a buyers' market. That's according to Mark Hodges, chairman of New York-based consulting firm EquaTerra, who spoke before a packed room at the conference.

"The HRO providers' capacity is strained and pricing has stabilized," he said. "A few years ago, multinational clients could count on having multiple bidders for their business. Today they may get only one."

The reason? Demand has far outstripped capacity, said Hodges.

Hodges defined "HRO" as the outsourcing of at least five HR processes to a single firm under a contract with a duration of at least five years. Many HRO providers have all the business they can handle at this point, he said, and as a result, prices have stabilized and have even trended up, in some cases.

"Customers could get great deals a few years ago," said Hodges. "Not anymore."

There are approximately 75 large-scale HR outsourcing contracts in effect at this point, he said, valued at almost $15 billion and covering 2.5 million employees. Even so, the market has a huge amount of potential growth, with the Global 2000 market barely tapped, said Hodges. Meanwhile, more providers continue to enter the market, offering the potential for prices to go down a bit in the next year, he added.

"It's not a mature market yet," he said.

"Tivo-ing" for New Hires

At a session entitled "Recruiting and Branding Commercials on Tivo," Nancy Kato discussed the considerable challenges of competing with the likes of Google for talent in Silicon Valley -- and how it's forced Tivo to be creative.

To compete, Tivo, a mid-sized company with 500 employees and 14 HR professionals, uses its brand and workforce to help attract talent, said Kato, senior vice president of human resources for the Alviso, Calif.-based company. Tivo makes digital video recorders that can be programmed to automatically record television shows, a process referred to by some users as "Tivo-ing."

Facing many open requisitions, the company's chief finance officer recently suggested "doubling down" on internal referrals, she said. Roughly 20 percent of Tivo's new hires currently come from referrals. "It's resulted in savings that otherwise would have gone to an agency," she said.

The company also uses its technology to promote jobs, posting certain positions under the "Message Details" screen of its service. Under headlines, such as "We're Hiring in the Bay Area," specific jobs are advertised to Tivo users. Kato cited one new hire from Apple that resulted from the ads.

Tivo has also taken steps to ensure managers stay engaged in the process. To ensure that managers have "skin in the game," individual business units are responsible for recruiting budgets, Kato says. "It encourages a lot of feedback [from business managers to HR], which is a good thing."

Note: Anne Freedman, David Shadovitz and Kristen Frasch contributed to this report.

Read New Horizons, Part I

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