Organizations start to look for efficiencies in their people processes by automating their administrative layers, like payroll, benefits administration, and routine transactions. The efficiencies that companies achieve from these exercises are just the foundation; the second stage is to go beyond cost saving alone and to look at deriving insights to drive talent management processes. This stage is not only about obtaining cost efficiencies but also about hiring the right people, ensuring they are placed in roles that they are most likely to be successful at, and using data analytics at all levels of talent management across the employee life-cycle. The third stage is where the real efficiencies are. This stage integrates the administrative efficiencies and the talent management process effectiveness with the motivational alignment that makes everybody in the organization ‘participate’ in the success of the company. This allows performance to be clear across the organization, facilitates learning and enables information to move across very quickly. Talent management processes powered by technology that enable standardization, intelligence & insights, build a layer of motivation and connect for innovation and value creation.
When organizations get the third level right, that is where the real value is. John Sumser, Principal Analyst, HRxAnalysts and Founder & Editor-in-Chief, HRExaminer, argues that getting to that level of value is really hard. The investment won’t populate like the normal ROI, “if you get the motivational layer right, companies can do things that are unimaginable, because people are able to solve radically different problems and companies are able to manage radically different things.”
Experts suggest that most organizations in western countries today have reached the potential that the second stage can provide, which is true for most MNCs in India and for some Indian multinationals too. In this cover story, The Turning Point, we provide a comprehensive snapshot of how organizations look at building value from their people processes and the role of the HR service providers in driving this transformation, through in-depth interviews with most of the important players in the Indian HR Industry. This story has also given us an opportunity to understand the buyers’ perspective and how they view HR as a lever to build efficiency, effectiveness and ultimately, competitive advantage.
The reality is that the great majority of companies in India are still struggling to leverage the efficiencies that automation and standardization can bring, let alone using talent analytics and integrating insights from different talent processes for decision-making in hiring, promotion, performance etc. The reasons are both the lack of maturity from the HR professionals to build the business case for investment in people processes and technology, and also the lack of sufficient experienced and contextually relevant service providers to support that journey. Today, many CEOs in India see the business case of investing in enhancing people productivity and it is for the HR community to take forward the conversation on how their organizations can benefit from those investments in terms of attracting the best talent, making them more productive and scaling learning and sharing.
The HR industry in the West evolved from administrative standardization to talent management processes integration, to bringing the layer of motivational alignment. The rising pressure for productivity, the challenges to manage people across locations, the imperative of leveraging technology while keeping the culture ‘high touch’, coupled with the access to technology and the demands of a younger population, makes India a great case for moving straight to the third layer of evolution, thus leapfrogging into the future.
A warning from the experts though: the third layer requires a great deal of work and commitment from all levels in the organization. As Sumser concludes, “You can get efficiencies from payroll and benefits without getting it hundred percent right, but at the top level you have to get it hundred percent right.”
We hope you enjoy this story as much as we enjoyed putting it together. As always, we would love to hear your views, suggestions, criticism and comments; do write to us at email@example.com
Wishing you all a fabulous year ahead.