As we were travelling back from a client meeting last month, we reflected on the day. We had just heard a familiar HR story: an organisation wanting to create a strategic delivery model, with shared services, HR business partners and centres of expertise. The organisation had familiar problems: how to get the business partners to step up, how to get the whole HR organisation to continue acting as one; and, what to do about data quality.
Data quality! Shouldn’t this be the easiest thing to address? Didn’t we deal with that in the 90s? Didn’t the Enterprise Resource Planning (ERP) roll-out solve the problem? It would seem not. We heard the same story three times in March: organisations have made the investment in HR ERP but they are not getting value from it, because the data within it is not accurate.
Every organisational context is different, but the general cause is this: local HR teams see the system as a ‘corporate tool’ that delivers no value to them, so they don’t update the data. Corporate HR can’t get value from the tool, because the data is poor, so they look to buy a Software as a Service (SaaS) product that will solve the data issues for their ‘talent pool’. From the outside, this seems like a waste of investment and data.
What could organisations do to break this cycle? What are the management fixes that could be applied before resulting to a technology fix? And what are the technology fixes that could come before buying another new system? We came up with three steps:
Step 1 – Find the carrot. One of the problems with HR data is that the information that HR people need is not always the data that is held on ERP systems. For example, in many organisations things such as reference letters and even absence records are stored outside of the core ERP. Updating the HR system can seem an unnecessary additional task that adds no value. What is it going to take to get local HR teams to want to update the data: Is there a killer piece of functionality that they need? Why do they resort to the payroll system for headcount reporting? Can we do something to make the core system their primary book of record?
In our experience, the key to this is to make the information in the system valuable to local teams that are best placed to ensure that the data is up to date. The best way to find this out is to ask them what they want. This could involve identifying the management reports that they need to use locally and ensuring that they are easily accessible. This will help ensure that HR people - who may not instinctively know how to get information out of databases, and therefore will not necessarily input it correctly - will make the effort to complete their data sets.
Step 2 – Bring out the stick. Well not a stick so much, as clear ownership and responsibility. This starts by agreeing a data model with common definitions. It sounds simple, but HR data can mean different things to different people. Consider the data field ‘Location’, what should it contain? Base office, Site name, Payslip location or even home town could all be valid, depending on the context. What is needed is a consistent understanding of what the data is.
The second step is to determine who owns each data item. One interesting technique we have seen has been making the HR business partners accountable for data quality for their business area. This means they are accountable for articulating the reasons for differences between budgeted, actual and system recorded headcount and organisation structure. This goes against much of the ‘theory’ that suggests HR business partners should be elevated to purely strategic rather than administrative roles, but it gives them a currency within the organisation, ensuring that they understand the details of the workforce that they manage and the exceptions that have been allowed.
Step 3 – Make it easier to keep the data accurate. There are four technology fixes that might help make it easier to maintain data without the cost of installing a new application:
Our three steps seem too simple, however organisations that have followed them have seen rapid improvements in the quality of HR data and user satisfaction, creating a ’virtuous circle’ of increased use and increased benefits.
Tim Palmer is Head of HR Transformation Consulting and John Harrison is a Managing Consultant at PA Consulting Group.