Like many HR Directors, I used to believe that things would really start to change once we had completed our HR Transformation. Our faith in these long, exhausting programmes appears to be undiminished. We continue to believe that the eye-watering investment, the drain on resources and the marathon effort will automatically deliver the Holy Trinity of manager-owned processes, self-serving employees and standardisation managed by a reduced group of experts at the centre. Eight out of ten large companies are currently running a programme to reduce the cost of their HR function with an average spend amongst the Fortune 500 of $10m every year. Yet, less than 20% of all HR Transformation programmes produce the desired results.
It’s a painful truth; HR Transformation rarely transforms HR.
Every transformation programme I’ve had the misfortune, or stupidity, to get involved with started with someone in Finance getting my team to do a benchmarking exercise as part of a cost-saving exercise. We duly obliged and benchmarked the hell out of staffing ratios, cost per employee, comparative investment in learning and so on. There would be loud tutting around the Board table as we appeared to be too expensive, overly resourced and, plainly, useless. Big consultancy firms, with equally big systems to sell, would explain how we could be so much better and so much cheaper. The feasibility study would show how we could centralise transactional tasks, standardise and automate our core processes and make huge savings – usually 25-30%. Weirdly, most of the savings seemed to stem from cumulative savings from bits of my team’s roles, but the means of actually turning this into hard cash wasn’t discussed. The savings were always the driving force – and only later would we talk up how much better it would be for managers and employees. We would get excited about how managers would relish having their org charts at their fingertips, how they could pore over key people data and analytics and how much fun they would have with automated succession planning charts.
I’ve been guilty of all of my sarcastic comments. There’s no higher moral ground being occupied here. But why were these Transformation programmes so painful and why did they fail to deliver the savings or the behavioural changes?
There are lots of reasons why HR Transformations fail to transform HR in my view, but here are a few of the more obvious ones.
So, it will cost you a load of money, will be a huge distraction whilst you’re implementing, will produce a system that won’t deliver what you want, is based around a dying organisation and employment model, will prevent you from taking advantage of new tech and will make your team and your clients unhappy. Apart from that they’re great!
For those of you on the brink of pressing the button on your HR Transformation, maybe it’s time to pause. Maybe it’s time to think through what will really help you transform – consumerisation of your employees’ experience, replacing tired old processes with humanised behavioural nudges, digital people products and analytics that reflect the way we actually work. If you’d like to hear about approaches to changing HR that really work, why not have a chat with us? firstname.lastname@example.org
“We started out with real agility and entrepreneurialism. Then, as we grew, we started to bring in lots of policies and process. Now we feel slow and less creative. We never wanted to end up being this type of company.” If this sounds like your organisation then this blog is for you. We've got some tips to help rediscover what made you great in the beginning and to avoid the accepted wisdom of what it means to be a grown up company.