Making the Business Case for Platform Change in Talent Management
by Mikyas Aklu, on Nov 4, 2016 8:23:30 AM
Making big decisions on HR/Talent Management platforms are largely strategic bets, but needed. Why?
Companies need to quickly conform to a more digitally nimble HR service delivery model as a means to enhance business value.
Organizations with an antiquated HR organization will undoubtedly have a tough time in recruiting, developing and retaining talent who take for granted instant access to data and insight, and who are accustomed to ubiquitous virtual networking in their everyday life. A key step to overcome this generational chasm is to switch to a unified, cloud-based system or platform that allows HR to seamlessly administer payroll, manage performance, provide competency-based training, assess employee engagement, deliver engaging onboarding experience, and many other talent management facets integral to the strategic success of the organization. This isn’t incremental change. Fundamental transformations often include platform change, and when accompanied by a fast company-wide adoption, has the potential to allow old school HR organizations to leapfrog the natural rate of progression.
When implementing these HR platform changes, a common mistake is to customize the new system around the old ineffective processes. As colleagues Richard Lynch and Jack Calhoun stated in their TEBR article A Transformation Manifesto, “CRM Platforms like HubSpot, HRIS platforms like Workday and cloud ESB technologies like Mulesoft are not just empty technologies looking for data to be inserted. They actually come with built-in processes to help the business improve inter and cross-department communication and information flow.” Many of the HR system providers today offer best practice processes - the gold-standard of what makes sense in today’s digital HR world. Accordingly, companies should try to take maximum advantage of the modern processes baked into these cloud-based platforms, notwithstanding the need for easy customer configuration.
In an ROI-driven world, cost implications play an integral role in shaping up any go/no-go decisions regarding platform change. That’s why it is vital to ascertain the Total Cost of Ownership (TCO) of cloud-based solutions vs. traditional, licensed on-premise systems. For example, cost of license and subscription, installation, customization and integration, data migration, training, maintenance support, hardware needs, and other costs should all be considered. One notable advantage of cloud-based solutions is that they do away with costly periodic upgrades, driving down long-term capital expenses.
That said, we also need to factor in the implicit cost of not delivering future-state strategic talent management capabilities. Take, as an example, HR’s generic capability in helping managers develop talent in the right ways to foster growth and contribute to the organization’s vision. Any meaningful analysis should ask what the consequences are in not executing well on HR’s ability to build required competencies in workforce for key skills, such as, financial analysis or data analytics. If, for instance, HR doesn’t have the right platform that delivers the competency based trainings in the format that new workers expect in the new digital economy, then that capability’s performance is sub-par and thus unable to deliver on the future-state vision of the company.
For more on building the workforce of the future, my colleagues, Amber Roman and Rich Lynch, have written an article with lessons on how to modernize an outdated HR service delivery model.