Written by: David Erickson is CEO of Elevate HR.
On a Monday morning, not long ago, I was sitting across a conference table from Audrey, the VP of Human Resources for a large global manufacturing company. Kyle, her manager of HR systems, stood at the whiteboard and drew a picture of their “Best of Breed” strategy for HR technology. “We have the payroll system in the middle,” he said. “Then we have our time keeping system, a custom PTO accrual system that hangs off of that, here…” and Kyle proceeded to draw a dozen different boxes in a variety of different colors, each representing a different HR system. Kyle proudly drew lines between some of the boxes to represent interfaces that he had created between them. He drew lines to the edge of the white board to represent interfaces to Finance, Manufacturing, and CRM. He had reason to be proud of his spider on steroids—he had done a lot of work to cobble together these disparate systems. He pointed to a couple disconnected boxes and said “I’ll get to those interfaces eventually.” For now, those boxes required duplicate manual data entry.
“We’ve created a ‘virtual HR Management System,’” he concluded, “by selecting the best applications we could find for each specific purpose.”
Audrey thanked Kyle as he sat down, then turned to me and asked, “Can you fix this?”
In truth, their “Best of Breed strategy” was not a strategy at all. Their “virtual HRMS” was born of one-off solutions to individual problems, not to a structured, coherent approach to HR technology. This “virtual HRMS” left Audrey’s staff struggling through HR processes that were unwieldy and inefficient. And it left the company’s IT staff struggling to provide the kind of support required for such an array of technologies.
The company was in the middle of implementing Microsoft Dynamics AX as its new Enterprise Resource Planning (ERP) platform, and HR was not part of that initiative. Audrey’s predecessor had been content with the existing web of HR systems, and declined to participate. Audrey realized that her “virtual HRMS” was very disconnected from the firm’s stated ERP strategy.
“Worst of all,” Audrey confided to me, pointing to the diagram on the whiteboard, “that is disconnected from the business as a whole.”
I would like to underscore the importance of her remark. Audrey was reasonably new to the company, and had been hired to create a human capital strategy that was integrated with the company’s overarching business strategy. This was a new approach for the firm, and she was excited to help build it. She realized, however, that while the company was moving forward, her department was stuck in the past. She turned to Elevate HR, Inc. for guidance, and we showed her how the Human Capital Management (HCM) features of Dynamics AX could serve her human capital strategy. We were able to demonstrate that integration would allow her to:
- Speak the same language about metrics and analytics as other business areas
- Stay differentiated from, but integrated with, the other key areas of the business
- Make smart HR decisions based on real-time cross-enterprise information
- Demonstrate a commitment to Return On Investment and lower Total Cost of Ownership
- Deliver on the HR Value Chain
Audrey had successfully built alliances with other business leaders at her company as they jointly created a new, integrated company strategy, but execution of that strategy was at risk. The answer was to implement the HCM solution set available from within the Dynamics AX platform, which could serve a new, coherent HR technology strategy.
Post originally written for Forbes.com: http://www.forbes.com/sites/microsoftdynamics/2013/02/15/hr-strategy-and-systems-a-tale-of-integration/