Workforce Planning - how not to do it

I was reading an LA Times article about teenagers not being able to get jobs. Seems that employers are attempting to hire more experienced people. Looking at the current demographic situation in the U.S. and probably other places in the world, a huge portion of the employable workforce is about to retire, taking knowledge, management, and process expertise with them. So it makes sense that as these employees retire or get ready to retire, employers are trying to beef up their staff with mid-career professionals to fill the gap that will be left.

Here's the problem with this dysfunctional approach. As mid-career professionals fill in the gap left by late career employees, what are we doing to prepare early entrants to the job market? Certainly college recruiting is on the rise everywhere, so if you have a 4 year degree, your chances of employment are very good. In fact, I recently spoke with a (very impressive) graduate who had no less than 6 offers from various consulting and finance firms. The reality is however, that many job market entrants are not going to be college educated. The U.S. is offshoring these (unskilled labor) jobs at a good rate but not doing much to re/train people.

So basically, we have a "perfect storm." The loss of immense knowledge and a displacement of low-skill jobs. I'd say that people in the middle of their careers now have an amazing opportunity to step up and reshape the future of work in the U.S. Any ideas?

-Dubs

Another new HR Blog

***Edited***

Another New HR Blog. Looks like decent content for now. I've been surprised how much content is coming out of India. Perhaps I should actually say that I'm surprised at the small proportion of HR content that I read and enjoy is coming out of the U.S. The large majority of my reading is from Indian or Aussie blogs. I'm not saying that there aren't U.S. based bloggers, but that I prefer content that originates elsewhere.

Anyway - the text provided in this space previously may not have correctly conveyed my intent. You can still see this content here.

How to make outsourcing work for you

An HR.com article written by a Dave Carlson from Mercer HR notes that “Teaming up with a compatible partner can make a tough job easier .“ (unfortunately you need $200 to get access to the actual article)

However, my rebuttal is that all the current HRO studies (the very current ones) are stating that satisfaction levels don’t fluctuate by vendor. Each vendor seems to have a broad selection of poor to excellent ratings. It also does not show that there are major differences between “compatibility.” What does matter is the client. Here are some components to look at:

1. Governance. Who and how are decisions being made regarding the relationship and any processing issues that may arise. You should consider this a partnership and not simply a vendor relationship. Having a project manager or vendor manager is not sufficient. Executive sponsorship must be maintained throughout the relationship.
2. Metrics. In order to have a decent relationship, a client organization must have HUGE amounts of data. Clients will generally state they expect similar performance at a lower cost. However, most clients don’t know how to measure that performance, and if they have not done so, cannot reasonably determine when things are going wrong. Thus, a client ideally wants to have metrics on all processes before and after outsourcing. This way, the partnership can establish reasonable service level agreements (SLA’s) and appropriate costing. Remember, it’s supposed to be a win-win.
3. Dispute resolution. There will be blips in service. Clients really need to be reasonable. When the client was executing the processes, there were errors and blips. This should be expected with the outsourcer as well. The problem is that clients feel that it’s easier to blame an outsourcer rather than work with them. Oftentimes the fault is bilateral, but in a world where the “customer is always right” this can be a difficult environment.
4. Scope of services. The reality is still that in most HRO engagements, most large agreements are only for payroll and benefits. There are a few that are growing to include comp, performance, etc. However, most of these HR oriented processes are focused on self service and technology deployment. The strategic planning is still retained by the client. There are a couple of problems with scope. First is that many clients want too much too soon. Second, clients have to manage their internal staff and managers after they go live. Once again, many will want to expect the outsourcer to perform jobs that are not in the agreement – this comes from education (or the lack of).

My message is that if you are in an outsourcing relationship or thinking about it, make sure you do adequate preparation. The relationship is bidirectional and should be treated as such. These people may become the main point of contact for your employees, so treat it as a partnership and be accountable when you as a client are accountable.

Female leaders deserve better

I was quite dismayed at this post on the Future of Work blog. The post is based on a link to a Matt Miller article from the New Your Times. In it, Mr. Miller makes some interesting points:

If the most interesting and powerful jobs are too consuming, Jody says, then why
don't we re-engineer these jobs - and the firms and the culture that sustain
them - to make possible the blend of love and work that everyone knows is the
true gauge of "success"? As scholars have asked, why should we be the only
elites in human history that don't set things up to get what we want?

Instead of writing about talent, job reengineering and such, the writer at the Future of Work blog decided to hi-light the following:

And he ends with a reminder of the story line from Aristophanes' play
"Lysistrata," where the women got their men to stop making war by withholding
that one thing that men want so desperately from women. As Miller puts
it: "Jody [Miller's wife] thinks that's a promising model. Talk about
unreasonable."

By skipping all the interesting parts of Mr. Miller's commentary, and taking his conclusion out of contect (it was clearly a joke), I found the blog's writing to be offensive and sexist. By writing about that one line, you insinuate that women will be leaders simply by wittholding sex. There was real content that was ignored between his humorous one line opener and one line close. Am I overreacting? Perhaps, but if you are going to refer to someone, please note their thoughtful comments rather than diluting their message and misinterpreting a one line joke.

-Dubs

Four Big Lies About Offshoring

I've written about this before, but here's some validation for me. I'm not going to re-print the text, you can hit the link, but here are the 4 big lies. While you read the article, think: offshoring=trade, because that's all it really is.

Lie Number One: Offshoring is a Threat to American Economic Prosperity
Lie Number Two: Offshoring is a Recent Phenomenon
Lie Number Three: Offshoring is Only About Cost-Cutting and Compromises Quality
Lie Number Four: Offshoring is Optional

Read the article and get past what the politicians in Washington are saying. We need to separate economics and politics.

HR Market Health & Vendor Updates

This info is now old (May 17), but I always find it interesting to see how vendors are doing. HRmarketer.blogspot.com has a quarterly review of some trends. Here are a couple of comments I have:

Paychex will always do well. They have an incredible business model and a rediculous record of profits. Their next move should be to move into the large employer space, but they need MUCH better software to do that. They may also not have the appropriate service model for that space yet. ADP dominates that space for outsourcers, but they do not consider Paychex a real competitor (except in the small market). ADP sees mevement away from ERP's as the real opportunity. ADP is also the only vendor that can beat Paychex in terms of profitability. They are back to double digit growth which was the corporate mantra for over 40 years (something like 160 consecutive quarters of double digit growth). It's good to see ADP there again.

Ultimate Software keeps claiming they are an outsourcer, but I just don't understand that. Based on prior comments, I don't get how these guys are making money. I think their software achritecture is crap, but they certainly do market well and the functionality is pretty cool.

Ceridian is spiraling towards death. Being under investigation by the SEC is never good, but here it means sales as low, moral is terrible, and they are losing market share. Simply put, why outsource an accounting function like PR to someone who had poor accounting controls???

Watson Wyatt was a surprise. They done ok since going public, but I'm surprised HRmarketer hi-lighted them as a positive. With a huge amount of their revenues coming from actuarial services, WWW is the riskiest of the 3 major HR consulting firms (mercer and TP). However, they do have alot of brainpower and hopefully they can transform their brand image slightly away from DB as the DB market will shrink over then next few decades.

Hewitt is a negative? Sure they fell short on revenues, but lets look at client aqcuisition. Hewitt is not taking any new implementations. As it is, they have an implementation backlog of almost a year. Hewitt has more business than they can implement and this is a great example (unlike WWW) of a consulting firm that has successfully transformed their brand for the economic future.

More international implications for SOX

Well, Canada has decided that they will pursue a Sarbanes Oxley-like legislation. This follows Japan, and the EU meaning anyone doing business internationally will need to file for SOX in a variety of countries.

I’ve written about SOX pretty often, but I actually think it’s been a good thing for HR. The focus on documenting and validating process in not something that HR has always done well, and this has forced us to do it.

Admonition to all ATS vendors

OK – I know that talent and talent management are the (not so) new buzzwords in HR. Truthfully, talent is incredibly strategic and requires a great deal of focus and energy. However, ATS vendors these days are calling themselves Talent Management Solutions. This is just wrong. An ATS is not talent management – it is a very, very small subset of talent.

Talent Management consists of many functional areas, bridged together to define a broader strategy. It really starts with workforce planning (itself a broad topic with subsets like succession and position management), before flowing to areas of recruiting, performance, learning management and career planning and then touching areas within comp and benefits. Managing talent through the employee lifecycle, organization strategy, and individual economic cycles is a thorough investigation of how talent affects the organization, and how talent is attracted, rewarded and retained.

So I know I’m mostly preaching to the choir, but as we see TMS popping up, we need to understand that many or most of these are really old ATS systems that have not changed. Very few or none are actually real TMS solutions. It will be difficult to create a full solution outside of the ERP’s and major HRMS vendors that covers many above mentioned aspects of TM. It will be even more difficult to find a TM vendor that does a good portion of the many activities well.

Strategic HR Budgets

ok - so there's been extra money in the HR budget for a few years as the economy is generally picking up, and HR "has a seat at the table." Years ago, HR could make purchasing decisions pretty much on their own and they would have to live with the ramifactions of bad software or vendors. This has all changed. Now that HR "has a seat at the table" and are considered "strategic" many of the larger HR purchasing decisions seem to be more regimented in the corporate purchasing policy. Gone are the days when HR is able to make quick HRMS decisions within their budget. More visible strategy work = more scrutinized purchasing and more compliance like Sarbanes Oxley = more scrutinized purchasing

All in all, it just seems to me that as HR tries to take more control over its desitiny, some of that is diluted as we get bogged down in corporate beauracracy.

Outsourcing and Strategic HR

Andrew wrote a nice piece about outsourcers and how they have to change their "look" in order to succeed in the future. To quote him,

Business service providers need to be strategic to truly succeed.
Indeed, being strategic can often involve low-cost delivery to free up a
client's capital for other uses. However, I submit that solely driving
prices to the bottom to gain market share, particularly in areas such as HR
services where the product is managing a workforce, will lead to low service
delivery and poor customer relations.

While I'm not familiar with the couple of Indian outsourcers in his comments, his position is well reflected in the major U.S. outsourcers. If we take ADP and Hewitt as examples of successful models, we can see how Andrew's hypothesis works out. ADP (let's look at PR only) is well known to be more costly than say Ceridian and ProBusiness (while it lasted), and ADP is the 1000 lb. gorrila in this market. The reason they can be more costly and have greater market share is because they have among other things, a generally better track record of compliance and processing throughput when it counts. You could say the same for Hewitt. Hewitt now has the only proven trackrecord of implementations (ok - at least the best in the industry) for HRO. They also have the trackrecord in pure benefit outsourcing - nobody else has the volume at the high end market.

I suppose that while I'm trying to reinforce Andrew's argument, I'm also trying to say that as an outsourcer, allowing clients to be strategic is one method of success. The key is not to be simply transactional or functional.

By the way - It's good to be back, but I'd rather still be on vacation. - Dubs

Dave Duffield and the next PeopleSoft

This is too good not to write about. Connect the dots:

1. OK – so go to davesnextmove.com and check out John Malatesta.
2. John Malatesta used to be the President and CEO of NetYourWork.com.
3. NetYourWork.com was a web based tool for ERP.
4. NetYourWork.com has taken their website off-line. The splash screen now redirects to Davesnextmove.com
5. Davesnextmove.com is has job requisitions for several positions. No, he is not hiring. These are the exact same job postings that were on NetYourWork.com prior to their taking the site off-line.
   

Conclusion: Dave Duffield will be taking over the employees, products and technologies of NetYourWork.com.

NetYourWork.com already had the following built:

• Reporting
• General Ledger
• Budgeting
• Accounts Receivable
• Accounts Payable
• Purchasing
• Expense Reporting
• Payroll
• Human Resources

So once Dave gets his infrastructure rolling, he’s going to have a new ERP by the end of 2005?

I won't be writing for a couple weeks

Don't think I've abandoned the blog. Just going to take a sabattical until the end of the month. Just started a new job and I need to concentrate on that for a bit. Not much going on in the HR tech market at the moment anyway.

HR Technology News notes

I just got done saying how nobody out there in HRO could really implement international payroll in a single platform. There are exceptions out there of course, but I thought ADP was the closest due to their network of in-country subsidiaries to file taxes and do all the other compliance stuff. Looks like I was wrong. Here comes Arinso with their Pan-European offering on a single platform. I hate it when I’m wrong. (maybe I should just think that I was a week ahead of the game)

In funny news, NuView thinks their newest offering is competitive enough to “fill the void” that PeopleSoft left. BWA HA HA HA HA!!!!!! To be honest, their stuff isn’t so bad, but it’s not a serious HR platform for the large market, and they are not sufficiently well known to compete.

Recruitment Process Outsourcing

I'm not totally sure what the difference is between RPO and hiring a headhunter. Perhaps there is more technology invloved, but a headhunter does many of the same functions. basically we are talking about replacing the recruiting function in your organization. Now, the RPO will write your job description, strategize and interview (prescreen) candidates for you, and do all candidate communications. Here are a few links

HR Outsourcing Awards: Accolo wins the prize for RPO of the Year
Accolo: What is RPO and what do they do?
The Lucky 13: overview of 13 companies who are providing end to end RPO

One more thing about labor management systems

One more thing about labor management systems: It will really help you with your wage and hour compliance.

Questionable truth in marketing

Not to be a naysayer, but sometimes cool things bug me the wrong way when I’m pretty sure the message is a lie. Today, Skillsoft and Plateau Systems are introducing the “first” integrated LMS and LCMS to be available later this year.

First of all, I’m pretty sure they are not the first to provide an integrated system for both learning management and content management. Take a look at vendors like DigitalThink.

Second, since they are 2 separate vendors with separate systems, I’m not really all that certain they have the integration built in. To me, there’s a major difference between integration and interfaces. There is also a major difference between integration and waiting for the next maintenance patch so you can load the new LCMS courses into your LMS. Then again, words like integration, customization, configuration are so overused and mis-defined that nobody really knows anymore.

Also in this press release: "Plateau has been a key partner in SkillSoft's early stages of formulating our recently announced open learning standards architecture (OLSA)," said Chuck Moran, president and CEO of SkillSoft. So SkillSoft is developing an open standard they they expect every other LMS to use? That’s laughable.

Time & Labor Management and tracking your key EE metrics

You know, I never talk much about labor management (because payroll and timekeeping is boring), but here’s a great example.

If we take a quick inventory of our major systems, we have:

• Core HR
• Payroll
• Benefits Administration
• Labor Management (Time & Attendance)
• Compensation Management
• Recruiting Management
• Learning Management

Labor management is actually a HUGE part of this and nobody ever thinks twice about it. Why is it a big deal? In actuality, it’s something that should be tightly integrated (there’s that integrated word again) with your HR system, Payroll obviously, Comp Mgmt, and maybe recruiting.

There are 3 key parts of a good labor management system.

1. Labor Standards (LS)
2. Scheduling
3. Timekeeping (TA)

Labor standards (for example the hospital in the article above) are the number of hours, FTE, or headcount you need to perform a job. For the hospital, you need X nurses for Y beds. For a restaurant, you need X waiters for Y expected customers. The labor standards should be able to adjust for the day, time of day, time of month, and other seasonality features. You could also think of labor standards as a subset of your position management function, although PM will also include budgets.

Once you have good labor standards you can now have the system schedule your employees. You labor standards should work in tandem with employee preferences (never works graveyard shift, on-call on weekends…) to create the schedule. Schedules are automated and posted on the web so that employees log in over the HR portal to view.

Now all your employees have to do is clock in. They can do this over the web, with a network login, fingerprint scan, biometric scan, or the old swipe cards. The importance of PM and LS is that the combination of this with actual hours worked from timekeeping will tell you when you are under/overstaffed. We are always talking about metrics, but the most important metrics, hours worked v. budget, productivity v. standards… are central to labor management systems. Check out Kronos and ADP.

Fortune 500 list is out

As usual, ADP is up there. They are really one of the only HR services firms big enough to be on the list. With $7.7 billion in revenues, they are around #250 (I'm guessing - have not bought the issue). On the data services list, they are #5, and they also usually rank #1 most respected for data services as well. Bearingpoint is on this list as well. At #11 and $3.4 billion in revenues, they are the largest consulting firm.

Dave Duffield's next move

Dave got his Chairman's award at the IHRIM conference on Monday. Here's the link for his next start-up. Not much content there yet.

Talent, Outsourcing, and MSS

Since my last post was on talent, I thought I’d see if I could tie it back into systems somehow. As we continuously look at talent in both retention and acquisition modes, we must realize that we’re not only trying to attract and retain employees with compensation, benefits and corporate culture (and such), we’re really trying to engage the employee in the business. When the employee is engaged, they are not only more likely to stay with the company, they are also satisfied with their position and will be more productive.

Much has been talked about regarding the role of Employee Self Service (ESS) and employee communications, but little has been written on Manager SS (MSS) and the effect it has on employee engagement. The role of managers in the employee process is critical. In the current age of more and more outsourcing (including that of local HR practitioners to call centers “somewhere out there”) managers are having to pick up the slack for routine employee inquiries and situations which may require someone to be face to face with them. Take for example an employee who wants to “vent.” Instead of going to HR (who isn’t there anymore), the employee now goes to the closest manager.

Managers are also (should be) playing a critical role in change management. As organizations react to global and domestic price pressures for benefits or compensation, the manager must ensure equity within performance and compensation review standards. Effective MSS rollout and procedures are a critical link in the communication strategy to employees. Since managers are now the critical link in direct verbal employee communications, the tools they have at their disposal had better be adequate and simple in the representation of policies and changes to policies. These tools include both information and automation tools. Not only should “dashboard” data and employee review templates be readily accessible, MSS needs to back up management training with appropriate info in MSS.

Talent, skills and the labor market

Talent: So where is the talent? Deloitte's talent study basically says that with baby boomers (U.S.) retiring, fewer college graduates with the skills needed in the workforce, talent is simply unavailable.

Skills: Check out this innovative general education curriculum at Pomona College. Instead of telling students, "you have to take one science course, one english course, one math course..." their curriculum is based on preparing a student with the skills they will need in life and work. Quite interesting.

Fist of all, very few of us went to college, studied a specific subject (like accounting) and actually went into that profession (like accounting). Even if you did go into that profession, the likelyhood you were still there 10 years later is remote. Second of all, when you have a person sitting in front of you for an interview, their background/experience matters very little. The resume stated the important experiential matters and they passed that test. When they sit in front of you, you are measuring them as a person. Do they have the right skills and qualities that matter to your organization?

Our problem is that more ond more, talent is coming from other countries. So we outsource call centers, and then want to import talent. Bill Gates is even in the fray with the U.S. Congress this week. For example, India is creating a culture where innovation and the skill of continuous improvement is essential. Even low level employees are adopted into this thinking.

As time moves forward and fewer and fewer candidates meet the talent requirements of our organizations, we also need to look forward to the coming generation and the educational institutions to step up to the plate and help us fill this gap.