Optimising the HR Delivery Solution Bill Farrell PricewaterhouseCoopers

2 Agenda  Shared Services - optimal solution ?  The Key HR Delivery Channels  Positioning technology in the delivery model  Where to next  Group Exercise

3 Why change the HR delivery model ?  Reinvention - the HR value Proposition  Cost Reduction  New Generations  Information Pull  Technology Push

4 Optimising the Delivery Model Shared Services Self Serve Line management Technology Cost Effectiveness Service Level Centrally Regionally By country By BUs Capability Lev el Operational Dependence Supporting the business Innovation Whole-sale outsourcing Buy In/Vendor Manage In Source Current Performance Location Strategic Relevance and Impact Supply Source Service Delivery

5 Strategically HR needs repositioning…... 10% Strategic Planning 30% Customer Service/ Consulting Administration 60% 10% Strategic Planning 30% Customer Service/Consulting Administration 60% 20% Strategic Planning 60% Customer Service/ Consulting Administration 20%

6 Recent research shows HR organisations are predominantly traditional and administration- based 80% 60% 40% 20% 54% 42% 43% 67% 62% 63% Financial services Telecom’s Technology Transport Source: PwC HCS Survey 2001

7 HR support staff FTE ratio for HR departments with and without shared services >5,000 employees Employees per HR support staff FTE Source: PwC HR Benchmarking Survey 2000 Shared services No shared services HR shared services has led to cost reductions

The Key HR Delivery Channels

9 Group BU Shared Services  Corporate policy  Corporate strategy  Decision support specific to the BU  Business analysis specific to the BU  Advisory Support  Specialist Services to be shared across organisation  Transactional processing  Lean  Bulk of resource for support functions  Service culture toward Corp/BU’s HR Shared Services delivery model

10 HR Delivery Channels Line Mgr BU HR Group HR Call Centre Specialist Talent Management HR Admin Employee Self Service Business Unit Shared Services

11 Strategic need Capability Cyclical HR processes, driven by corporate objectives Planned HR interventions, addressing critical Corporate and BU specific needs Administrative HR activities driven by employee life cycle needs Specialist HR Services, requiring expert design, interpretation and advice Typically embedded in business unit Strategic Need Capability Business Unit Shared Services The roles of BU HR versus Shared Services

12 Understanding your customer, is key to successful delivery Corporate Employees Managers Business Unit

13 Process example - recruitment and selection Define strategy and job requirements Recruitment Policy New Starter Orientation GHR BUShared Services  Advertising  Short listing Candidate Management Interview and Selection of Candidate New Hire Admin. End To End Process Design

14 The optimal service delivery model for an organization may include some combination of SELF-SERVICE, SHARED SERVICE, OUTSOURCED SERVICE, all accessible and branded through a portal. Optimising the HR delivery Model

Technology

16 B2E’s Brief But Important History A year ago: ‘B2E’ = B2Employee and was all about web-enabled HR functions Several months ago until now: ‘B2E’ = B2Enterprise Evolving into: ‘B2E’ = B2EVERYTHING B2E is the platform for a new way of working more efficiently, more effectively, more productively, and with less cost.

17 What Is B2E?  A single channel for communicating with employees— instantly, consistently, globally.  A platform and vehicle for a new way of doing business, where employees can access information anywhere, anytime.  A link for employees with customers and suppliers, internal teams, tools and work… maximum flexibility and increased productivity.

18 People prefer the web InquiryHR OnlineCall Center Verify Employee Data Compensation Salary Adjustments Salary Ranges Stock Options Leadership Development – Performance Management US Savings Bonds Profit Sharing Holidays 16,385 Hits 15,815 Hits 3,802 Hits 3162 Hits 1,675 Hits 1,341 Hits 1,206 Hits 569 Hits 29 Calls 14 Calls 19 Calls 1 Call 9 Calls 1 Call 8 Calls 1 Call 3 Calls

19 The Savings are Well Proven CompanyOn-Line Service Savings /Employee SprintEmployee Data$20/yr OlinPay statements$9.25/yr HPPolicy Manual$9.75/yr F/SOn-boarding$42.51/yr PwCTravel reservations$34.5/yr Energy CoWeb server consolidation$16.30/yr E-Services CoTraining Administration$70.90/yr

20 Implications  HR Capability  Clearly Defined Touch Points  Technology as enabler, make it easy to use - think access  Process Consistency and Simplification  Technology Push  ‘eat your own dog food’

Discussion Points