It may not always be the news organisations like to hear, but the man dubbed a “housetrained maverick” by one business writer has some blunt, sober advice for those implementing new technology in HC.
Otto Pretorius, Director at QBIT, formerly known as Systemic Business Solutions, says, “It’s vital that organisations do some clear thinking before acquiring new HC systems, especially if they have any hopes of gaining a return on their investment, or turning their HC operation into a strategic arm of the organisation”.
Pretorius points out that many organisations buy new technology in the hope that it’ll be a panacea for poor HC processes or flaws in their Business Architecture. Only when lamentable costs have been incurred do many CEOs, Boards and HC Execs do what they should have done first: Ask exactly what it is that the organisation needs and then consider the alignment between how the organisation operates and the fit of technology.
He refrains from naming the organisations involved, but quotes several case studies where “tens or even hundreds of millions” have been spent on new systems that are less than 30 percent effective.
Pretorius notes that some of the most spectacular failures occurred in organisations where IT systems were not a core aspect of day-to-day business – in one case, a transport utility lost 10’s of millions, only to discard the system shortly before it was due to ‘go live’. Several other examples spanning both public and private sector, were also referenced, that lead to some spectacular failures in implementing HC technology.
He emphasises throughout, that “this is an organisational issueand not a technology one. Technology can enable what you already have in place and might make it faster and more efficient. It can’t fix poor design or make inferior thinking look better. It’s not the technology that’s at fault. The responsibility lies squarely with the organisation and the professionals in charge”.
As stunning as the failures are that Pretorius has enumerated, he maintains they’re far more widespread than a lot of organisations would like to admit, or the technology houses would concede.
He is quick to add that fiascos of this sort – and the resulting disruption of operations and chagrin of shareholders value – are by no means inevitable. Lots can in fact be done to prevent these occurrences. What is required, he maintains, is “a willingness to challenge conventional thinking on the role of HC in the organisation, its integrated business processes and how HC solutions are built and owned”.
Pretorius asserts that “HC practitioners have traditionally acted as clerks and gatekeepers, rather than people who are prepared to operate the HC division as an optimal business area and a strategic tool of vital importance to the overall organisation’s biggest cost or investment, if you want”.
The role of corporate culture shouldn’t be underestimated, he adds: “Simply shoehorning new technology into an HC operation that’s in crisis won’t increase its operating efficiency or its potential to act strategically. Similarly, if the HC operation’s administrative processes have become the end, rather than the means to an end, implementing new technology won’t remedy that. It’ll simply embed that thinking.”
In a situation like this, Pretorius likens the situation of organisations hoping to change their HC systems to a game of battleships: “where you basically take shots in the dark, hoping to hit something – very expensive, very de-motivating and very poor business practice.” He adds though, that with the right planning and a willingness to “ask the hard questions and act on the answers before implementing a system,” these paradigms can be overcome.
What’s certain, says Pretorius, is that “HR will increasingly be required to justify its existence and its costs, just like other departments of any organisation” and it can. “HC’s destiny is to be the hub of people diagnostics for an organisation and the place where trends are first detected. It’s where people costs are tracked, while constantly aligning the right people to the right jobs”.
“Technology can help make that happen, but only if the will exists amongst the HC practitioners to make that leap. When the will exists, and the right technology is at hand, it’s attainable. A lot of HC people haven’t realised yet that they are the enablers of people management and Managers manage people. Once they start seeing themselves in that context and start demanding their systems facilitate that interface, things suddenly become clearer”.
Pretorius adds “that without this major shift in the role of HC within organisations, a point is reached where the business questions the need for an HC operation department at all. You’ll get some devil’s advocate saying, ‘The executives can do the recruitment, the line managers can handle the administration and accounts can handle the pay role; we can get consultants in to handle the IR stuff – what exactly is it we need these guys for? Ultimately everyone in the organisation must ask, “What value do I bring?”. In the case of HC, am I a clerk or do I provide hard people intelligence, used for improved decision-making? Is my job to ask whether everyone’s leave stats are up to date? Or is it to be able to look at reliable stats and ask how the organisation responds to poor performance, or salary alignment, or people development, or other talent risk issues?”
Pretorius says, “organisations benefit from a bit of freethinking on how people fit into the organisation and how processes are designed and then enabled through HC systems”. He says “it requires a special group of people to do this: You’re talking about a difficult period in an organisation’s history. It’s watershed, with plenty of conflict, uncertainties and change. People worry about the way it was and their own role, versus what really enables the organisation to move forward. These freethinking processes have indeed evolved a lot over the last 10 years since the first version of this article was published”. You are referred to more recent articles on HR Functional Solution Architecture, Work-Centric Thinking and SIPP®(Standard Integrated People Practices).
Sadly, not too many organisations have completed the journey of transitioning their HC Department. Encouraging case studies have however become available echoing ideas in this and other articles referenced. HC is clearly moving into the strategic realm. The length of the journey is very much a factor of how much pain you want to endure and how open minded and skilled the professionals are, to influence and empower the organisation to do the right thing.
Pretorius comments that “this is new thinking to many HC professionals and business people alike and that tertiary institutions and professional bodies have historically been slow to act. He continues by mentioning that some of these bodies and institutions have finally come down from their ivory towers – and changes are afoot”.
Pretorius closes the interview saying “it’s worrying that, so many organisations lose fortunes and credibility before getting help. The ones who’re willing to talk are the ones who’ve already been through the pain. That has to change. If your organisation looks to its HC operation just to fulfil its compliance to legislation, it’s not going to realise its potential for growth, service delivery or shareholder value.”
First published by William Smook in May 2004;
Revision Otto Pretorius June 2014
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