HR Magazine - Be smart to be SaaS-y

Having a single source of truth for people data, excellent functionality and a modern user interface promotes manager self-service and reduces HR administration resources. It enables HR big data analytics and reporting, and better HR process flow.

The new standard of HRIS (HR information system) is Software as a Service (SaaS). SaaS means that rather than each company customising a piece of HR software to meet their distinct needs, organisations adapt one common flexible system. Every company with a particular HRIS is on the same version of the software as it is hosted virtually in the cloud. It also means there are standardised ways in which compensation, recruitment and other HR processes operate, and these need to align to the pre-configured best practices of the cloud solution.

This SaaS approach can be cheaper than traditional systems and is rented by the company rather than owned. But there are significant implications for HR if it is to make the most of its investment.

Here are our tips for potential movers to SaaS-based HRIS:

Be proactive and own the implementation from an HR function point of view – we frequently see IT experts driving the configuration of HR process and this is far from ideal when HR will have to live with and demonstrate value from the system.
Own the data structure. Many firms do not give enough thought to the framing of employee data. Organisations can bring real meaning and utility to data by codifying it using a people or career architecture. This has three elements – organisation: (1) of people into roles – a collection of common jobs that have the same broad purpose and accountability (2) of roles into levels – usually defined with the help of job evaluation these are best clustered into natural career stages to align reward and talent needs; and (3) of roles into job families – groups of roles that have the same career paths, value in the market and skills. This creates the ‘common language’ and consistent structure for data reporting, analytics, talent and compensation programmes etc.
HR roles and capabilities will shift. Extensive manager and employee self-service enables HR to be more strategic and solution-orientated. This brings change in HR’s talent requirements and structures from functional specialisms to outcomes. The new architecture also enables the function to deliver quality analytics and integrated people planning and reporting, this capability needs to be acquired and the implications managed. Engagement with the business to understand their needs is a great start but so is considering the ability and capacity of the HR function to respond to the bar being raised.
Take time to rethink process. The move to SaaS means there is going to be a whole new way that you can manage the flow of decision-making. This is a great opportunity to re-think processes that were fit for a non-digital era; how many decision points are really needed in a digitised process flow? Does the shift to a more global approach mean process change? It is important to consider streamlining processes before implementation to get full benefit from the change.
HR function governance will change. For organisations that have operated HR governance in a loose, federated manner there are likely to be implications as the new system makes processes and policies more alike. The pressure of the system is for power to be concentrated in the centre and this change needs to be worked through to ensure the global HR community is ready and organised accordingly. HR structures need to align to reflect the change in governance, roles and a more strategic focus.
Enhancing manager capability is important to deliver on the promise of self-service. Managers need to be empowered by training and having the necessary authority to take decisions – each organisation needs to set these for themselves. Supporting this change, HR must focus on developing tools and capabilities that make sense to managers rather than just HR, and on delivering a broader, more integrated experience for managers (and employees) as part of a holistic and connected view of people management.