Transition from basic processes to strategic management by personnel: technologies, difficulties, perspectives

Alexander Shishilov: A number of leading specialists who represent HRM to the practician to EAE-Consult companies began work with personnel management systems at a transition stage from understanding of a HR system as payroll systems to something to more volume. In the late nineties – the beginning of the 2000th there was an important process of awareness of importance of integrated approach to a personnel management process, the Russian organizations groped the way and approaches to creation of systems. Understanding of importance of the process approach, data integration, centralization was developed. Emphasis, certainly, was placed on basic processes, application of the standardized solutions as opposed to self-written, detailed study of requirements of the legislation of the Russian Federation. Growth and development of the systems of the Russian production was observed, in parallel there was a deep adaptation of the western means.

Now there was a relative consensus about market saturation of basic processes and, at the same time, readiness of the organizations to take the next step in development of personnel management systems. The probable movement in the field of core process optimization lies in a junction plane to different outsourcing models both regarding maintenance actually of automation systems, and to outsourcing of processes entirely. Probably, this stage can be designated as harvesting: the companies have an opportunity to estimate real effects of implementation of the integrated personnel management systems, to perform organizational conversions in the field of HR of management, to release resources from routine transactions.

TAdviser: So in HR services additional degree of freedom and opportunities is formed?

Alexander Shishilov: Right. In it there is a certain originality of the moment: HR services of the organizations approach by the time of when their advantage for business is not limited to high-quality execution of functions on supervision of a compliance with law in the field of work any more that was a proprietary task in the 2000th. The market dictates other tasks connected with increase in efficiency of work, search and deduction of highly-skilled employees, formation of adaptive corporate culture now. In terms of automation it makes absolutely other demands and approaches, there is a transition from accounting of the fact according to legislatively enshrined provisions to a creative task of the description of individual characteristics of the internal structure of the companies and target functions of its development providing the long-term growth and stability of business.

TAdviser: Whether it means that the technique of implementation of HR systems which took roots now should be reviewed?

Alexander Shishilov: It is rather possible to say that the implementation techniques recommended by leading experts of the process focused approach to automation should be apprehended really seriously. It is first of all about a stage of conceptual design. If for basic HR of processes this question is particularly acute not too because of a tough framework of the legislation which in itself creates sufficient determinancy for implementation of system implementation, then for processes of strategic level of management such approach is not admissible. In the absence of the worked methodology coordinated to development plans for business, implementation of processes of strategic management by personnel with high confidence figure will be a fiction and will cause more damage, than advantage.

TAdviser: Whether it means that there are no standard solutions in this sphere, and the customer should create own software products?

Alexander Shishilov: Certainly, each vendor respecting itself offers the expanded set of functions automating performance management processes in a broad sense, without it the modern product cannot be called a HRM system by determination. So, good study of these levels is available in those products which our company offers the clients – SAP ERP of HCM and the BOSS-personnel officer. However this layer of automation has much bigger variability and is subject to serious setup at implementation, and the accent should be postponed for a phase of conceptual design.

TAdviser: Whether it makes other demands for an implementation team?

Alexander Shishilov: More likely, it is about wider context. On basic processes consultants and representatives of business describe, in fact, de facto the developed and well regulated processes, creating the necessary setup delta. On the contrary, at automation of strategy processes the project team gets to an uncertainty field as the automation equipment allows to create the new processes which are not existing in the organizations not feasible for lack of an automated system which are not stated in the law. So the project collective by determination should have bigger capability to create creative result, without becoming isolated within koping-strategy and a support on documents. Therefore, only good knowledge of the labor law and settings of a system is more not enough. In a command there have to be specialists with knowledge of related subjects from the field of business and psychology.

TAdviser: One of levers to acceleration of implementation is the thesis of integrators that in serious information systems study of processes at the high level and taking into account world experience is already performed. As far as it is applicable for processes of strategic level?

Alexander Shishilov: It is applicable partly, it is necessary both to apply this thesis and to take with caution. More likely, here it is possible to speak about some conceptual approaches, a system skeleton. The devil is in fine details, but their set can have a cardinal impact on a final result – whether the instrument of increase in business performance or the fifth wheel will turn out at the exit. In case of strategy processes of a frame not the technology, but requirements of business and quality of their study prior to any automation sets nevertheless. And it is the is best of all – prior to the choice of the specific platform.

TAdviser: Whether can stimulate these difficulties failure to decide of business by consideration of projects on automation of strategy processes?

Alexander Shishilov: Yes, it is possible to speak about the known complexity here. Risks and responsibility will be higher. From sponsors of the project and heads much more attention and also involvement of essential bigger number of participants in the organization will be required. Support of collective and acceptance should be provided, questions of management of organizational changes, internal PR - and, product qualities differently sound. The speech will go about setting of a business management system, but not about more usual and highly specialized task of automation of HR service and accounting.

TAdviser: What features does bring to similar expansion of the project on all levels of company management?

Alexander Shishilov: It is definitely possible to tell that in the companies, especially with the lines of management inherited from Soviet period, collision of the points of view in the range from extremely orthodox view of personnel in a metaphor "people-as-bricks" before humanistic representation of people is expected as living individual beings, with unique stories, interests and destiny. Search of the solution arranging all parties in style of deep democracy when opinions of all parties should be considered is necessary.

Also communication of the modern technologies, by determination laying the foundation for unification and standardization of the intra-corporate relations with opportunities of the movement to the world of bigger humanity can seem strange, but paradoxes of the 21st century are partly shown that the industries untied at first sight or technologies unexpectedly meet in certain points, mutually supplementing and developing each other. It is enough to remember unexpected communications and correlations of views of the consciousness nature in modern quantum physics and philosophy.

TAdviser: How you does imagine this interrelation?

Alexander Shishilov: Technologies, in a broad sense, allow to release energy for something else, saving at the same time online access to information in the form ready for perception and decision making. They allow to open and objektivirovat trends, hardly accessible for the analysis, and to build more exact forecasts. And, in addition, they can be the management tool, i.e. give real levers of influence as it occurs in personnel performance management systems.

TAdviser: How about management of satisfaction of workers?

Alexander Shishilov: Yes, there is such indicator. It is quite difficult to formulate it, it is subjective inherently. However the companies which decided to bring this parameter to the level of the measured metrics can get long-term benefits. It will be difficult to measure effect at once, but a lot of resource of workers, leaving now on a peresilivaniye of and suppression of negative emotions will be released eventually. Many sources say that the satisfaction and the joy of work leads to quality improvement of an end product, decrease in incidence, economy of costs for salary for the account of non-material factors of motivation.

TAdviser: Whether functions of heads of divisions at implementation of strategy processes of personnel management change?

Alexander Shishilov: More likely, it will be a question of reconsideration and emphasis of certain functions of heads. It is necessary to answer more accurately a question of a role of line managers in personnel management and on management style, acceptable for the organization. Whether it is important to pay attention to factors of increase in creative potential of workers? Whether the company is focused on achievement of the necessary level of independence at all levels of the organization? How the initiative of heads in case of decision making in the absence of the exact and objective information is supported? What level of tolerance to errors? What are available tools of motivation and at what levels of management they can be applied? It is only a small part of questions which should be cleared prior to implementation.

TAdviser: What projects on performance management are kept by your company?

Alexander Shishilov: In recent years at different stages of study there are several projects in the different industries – mechanical engineering, government institutions, the energy companies. The most interesting is the project of creation of a system of efficiency evaluation in one of large holdings.

TAdviser: What difficulties did you have to face?

Alexander Shishilov: The basic, perhaps, is that our command works in wider context, than technical consultation. It is more than business focused understanding and other level of interest, but it represents not only complexity, but also a bonus.

At the same time in the course of the analysis of the experience of implementation of similar solutions which is available in the Russian Federation, we opened some reefs. For example, there is a contradiction of the following character. In the Russian reality workers do not want that they were estimated, they do everything possible for simulation of assessment, and in it they are promoted also by managers of the lowest link who are dependent on loyalty of collective. As a result all good intentions of the management to measure parameters of efficiency and the levels of development of competences break against the passive, but organized resistance of bottoms. Naturally it leads to obtaining consolatory, but useless result: the purposes are performed according to the plan, competences conform to requirements to a position.

It demonstrates that in parallel with implementation of an automated system it is necessary to resolve issues of transformation of corporate culture the fear of punishment was less motivation on opening of problems. Accurate clearing is necessary that behind assessment of competences there is an intension of firm to optimal plans of growth of workers, and not just and not so much "singular solution" to disposal of objectionable. It is required to provide credibility and acceptances of innovations.

TAdviser: As far as does it turn out to create the single unified solution on strategy processes for large holding?

Alexander Shishilov: The amount problem at automation of strategy processes is particularly acute more, than during creation of templates on basic processes. As it is about setting of a business management system, accounting of parts of work of a specific business unit is a necessary condition.

For the big companies, there is a certain complexity in understanding of as uniform organism, owing to a large number of components and the differing ideologies. It is unlikely it is possible to rely on the fact that for the worker in field conditions of Far North and for the Moscow office manager motivation factors, as well as put forward by business of waiting to their behavior and efficiency will match.

For an automated system it creates additional degree of complexity since on the one hand it should provide whenever possible single interface and the principles to all participants, and on the other hand – to answer the differing methodological approaches for different target groups. Methodologists should resolve issues of breakdown structure and selection of the common and specific features for the different forms of government, categories of personnel and types of activity too.

TAdviser: Whether special demands to ergonomics and an esthetics of solutions are made by customers?

Alexander Shishilov: Really, in the field of process automation, assuming involvement of all personnel of the company, the subject of convenience of using and appearance of solutions begins to sound more significantly. It is no secret that for more narrowly targeted production systems vendors tend to give a priority to functional parameters in comparison with ergonomics and an esthetics. Partly it is caused by a suppressed feedback of users relatively annoyingly of inconvenient and frankly ugly program interfaces, to inherent many ERP systems. Command and administrative implementation methods allow to implement effectively and in time any product meeting formal requirements, but without a number of important non-material factors.

However for some systems to which number it is possible to refer performance management of personnel the neglect ergonomics and design can result in effects, opposite expected: instead of growth of trust and efficiency there is a chance to get deaf irritation of workers, passive counteraction and cardinal underexploitation of potential of a system.

TAdviser: How clearly the talent management subject sounds now?

Alexander Shishilov: So far we see dominance of resource approach. Yes, there are hints on talent management in the field of change of views of the process of management of a talent pool inherited from Soviet period. Perhaps, the concept of a reserve will turn over time into the concept of gold fund of the companies, those 5 or less percent of workers in which 80% of finance and time expenditure for their deduction and effective use will be enclosed.

TAdviser: When it is possible to estimate effects of implementation of a HRM system?

Alexander Shishilov: Our extensive experience of projects implementation says that significant effects of HRM systems are shown very gradually, in process of accustoming of business to new tools and acceptances of new methods of business management. Positive dynamics clearly becomes visible to basic processes after five years, in particular, if the company was not limited only to automation, but also executed adequate structural conversions. On processes of strategic development effects will be by determination more long-term, and at high-quality setting of a system – more considerable.

TAdviser: What most frequent mistakes are made by customers when choosing HRM systems?

Alexander Shishilov: There are known problems in preproject study of the purposes, appointment of the sponsor of the project, assessment of the budget, realness of terms. But one of the steadiest and difficult to explain myths, to the disturbing customers to make an adequate choice of the software product, the myth about synergy effect of use of HRM systems as a part of ERP from one producer is.

Therefore happens so that customers accept simple, but unreliable optimal, the solution that if in the company the accounting system from a certain vendor is used, and a HRM system should be selected the same brand. The reality is far from similar judgments as the sphere of HRM stands alone from the accounting systems, operation principles and implementable processes are specific, joining with the BU system happens on narrow and easily controlled section.

At the same time the ideology of ERP expressed in terms of closing of the period and accounting of units of goods sometimes creates the Procrustean bed for HR processes. It means certain restrictions in convenience of using of a system for the customer, additional costs on user training, connection of an administrative resource to force users to work in a system. In our opinion, it is reasonable to consider HRM systems only in the context of optimal application for personnel management, leaving out of the equation questions of sharing with accounting programs.

TAdviser: How can you characterize market situation of HRMS in Russia?

Alexander Shishilov: There is a macroeconomic situation which dictates at least care in optimism regarding development of the IT industry in the next years. On the other hand, for HRMS sphere deterioration in the general economic terms can have the paradoxical investigations in awakening at customers of additional interest in problems of assessment of effectiveness and competences, standardization of training, management of working time.

TAdviser: How successfully this splash in interest can be converted into new projects and solutions?

Alexander Shishilov: Here it is necessary to consider the overall insufficient level of a maturity of participants of the Russian market in comparison with world. Even trends will differ if to compare – for example – a share of SaaS of HRM in the relation to the licensed placement in the world and in Russia. Regarding the systems of personel assessment and the automated training management processes based on assessment, career, personnel recruitment, in a sense it is possible to characterize market situation as what was inherent in it regarding basic processes in the beginnings of the 2000th. At that time in the market there was no commonly accepted image of what is HRMS on basic processes on the one hand, and really full-function HRMS systems - with another were not provided. The offers of vendors (for example, SAP HR 4.6) taken as a basis 10 years ago required so large volume of completions by the Russian legislation that the resulting product reminded self-written products of departments of automation more, than the solid module with standard updating of versions.

Now the situation in something is similar: many customers did not save up still sufficient understanding that the personnel management system of strategic level in the Russian reality should be really. At the same time and most integrators are rather in a status of judgment of new approaches, grope the interest of the market, consider and offer different alternatives in the technology roadmap, accumulate own business competences. Technologies also have still high potential of development, in process of increase in number of projects basic means certainly will be improved.

TAdviser: What development waits for area of basic processes?

Alexander Shishilov: It is possible to see the potential of development of basic processes towards forecasting of budgets, automation of adjacent processes like accounting of SIZ, VHI, sots. packets, the distributed time keeping, accounting and control of the actual labor costs, flexible management by diagrams of interchangeability, labor protection.

But there is much more important aspect which is shown that the basic income in the field of automation of basic processes in the near future lies in a support and maintenance of the created solutions. At the same time still frequent scenario is creation of own escort service as divisions of the customer that has negative effect on a possibility of integrators in competitive struggle to offer result with the best ratio price/quality. More productive is the policy of the largest integrators and HRM producers of systems directed to development of the consensus regulations and standards defining service quality of HRMS systems and allowing customers to pass to the scheme of outsourcing of maintenance services.

TAdviser: What can you tell concerning perspectives of development of cloud solutions in the field of HRM?

Alexander Shishilov: There is a world practice which demonstrates that the companies aim to display routine processes out of limits of organizational perimeter. In Russia the block of employee administration and payroll probably ripened to go to the HRM SaaS models, and not only in small and medium business. Restriction is more certain inertia, than real contradictions. But experience of the developed countries says that these functions are not necessary in core business. Core business should do a product, and concerning correctness of payroll and timeliness of submission of reports to inspection bodies the professional organizations should undertake care.