HR in the 21 st Century: The Transformation Continues Row Henson HCM Fellow, Oracle Corporation

Convergence of the.(dot) Shifts Business 2.0 HCM 2.0 Web 2.0 = Transformation 2.0

Evolution for HCM New Demands for HCM New Workforce Demographics New Workforce Demands New Technological Paradigm New Workplace Demands Systems Agility Collaboration / Sharing Extended / Global Efficiency / Effectiveness Business Agility Engagement / Retention Workforce Intelligence Business Performance

Evolution in Technology Today’s Technology Environment Web 2.0 Yesterday’s Technology Platform Web 1.0 versus SQL / Relational Componentized / OO Development Customization / CodingComposition / Orchestration Implementation Perpetual License On Demand / SaaS Pricing/Delivery Standalone / Within 4 Walls Integrated / Extended Network Business Perspective Hardwired / MonolithicWeb Services / SOA Environment Process Efficiency Business Effectiveness Primary Value Return on Investment Total Cost of Ownership Economic Focus Source: Beaman & Macy, 2006

Evolution in the Business Environment Today’s Business Imperative Work 2.0 Yesterday’s Business Agenda Work 1.0 versus Transactions Business Events System of Record HierarchicalCollaborative Organization Episodic / Serial Constant / Simultaneous Rate of Change Skills & Expertise Tacit Knowledge Business Perspective Back OfficeEveryone Automation Physical Assets People Assets Primary Value Bottom Line Top Line Economic Focus Source: Beaman & Macy, 2006

Evolution in Human Resource Systems Today’s HCM Suite HCMS Yesterday’s HRIS Application HRIS versus An Afterthought At the Core Global Regulatory ComplianceComprehensive Framework Governance Reporting / Analytics Embedded Intelligence Business Output Gatekeeper Business Partner Business Perspective Payroll & BenefitsCompetencies & Performance Functionality Efficiency / Costs Quality / Performance Primary Value Efficient Records Automation Effective Talent Management Economic Focus Source: Beaman & Macy, 2006

Evolution in the Human Resources Today’s Human Capital People Yesterday’s Human Resource Labor versus Brick and Mortar Mobile / Virtual Work Place Consistent / ConstantDivergent / Sporadic Work Style Homogeneous Global, Multi-cultural World View Labor as Expense People as Asset Business Perspective Departmentally FocusedExternally Focused Organization Process Efficiency Performance Accountability Primary Value “Company-for-Life” “All-About-Me” Economic Focus Source: Beaman & Macy, 2006

Agenda HR Transformation HR Transformation – beyond HR Transformation Report Card HR Transformation Competencies The Future of the Workforce Technology Foundation – Web 2.0 Measuring the Impact of Talent on Business Results

Reengineering Human Resources 1995

HR Transformation – A Global Thing Over 75% of firms involved in HR transformation efforts US leads in completed projects Huge number of “in process” HR transformations elsewhere Only a few HR leaders have no plans Source: Mercer HR Consulting Global HR Transformation Study, 2004

It’s About Time (Spent) Source: Mercer HR Consulting Global HR Transformation Study, 2004 After 10+ years talking about being more strategic…not enough progress!

Agenda HR Transformation HR Transformation – beyond HR Transformation Report Card HR Transformation Competencies The Future of the Workforce Technology Foundation – Web 2.0 Measuring the impact of Talent on Business Results

What is HR Transformation 2.0 Mercer 2006 Transformation Study

Mercer 2006 Transformation Report

Agenda HR Transformation HR Transformation – beyond HR Transformation Report Card HR Transformation Competencies The Future of the Workforce Technology Foundation – Web 2.0 Measuring the impact of Talent on Business Results

Transforming HR One size does not fit all Process flexibility and adaptability Innovate or be outsourced Business partner/business alignment Owner of corporate culture/ employee brand Competency/talent identification & development Project management skills Better analytical skills

Future skill requirements for HR professionals – Mercer 2006 report Interpersonal skills Team skills Interviewing and assessment Consultation/negotiation skills Leadership Change management Cultural change/transformation skills Business understanding Conflict management Coaching/facilitation Customer service HRIS data analysis and reporting

Agenda HR Transformation HR Transformation – beyond HR Transformation Report Card HR Transformation Competencies The Future World of Work Technology Foundation – Web 2.0 Measuring the impact of Talent on Business Results

Future World of Work What will the workforce look like? Where will the talent come from? Workplaces or workspaces? Who owns the talent pool and the company culture? How do we prepare for these changes?

Workforce Demographics Reduced Workforce Workforce is getting older 3 Generations working together Increase of women in the workforce Rise in the contingent workforce Global, mobile, virtual worker Decline in education level in developed countries Dominant language in next 50 years – Chinese?

Each generation in the workplace comes with its own sets of experiences and expectations that can occasionally come in conflict with one another TraditionalistBoomerGen X Gen Y Training Learning style Communication style Problem-solving Decision-making Leadership style Feedback Technology use Job changing Source: Lancaster, L.C. and Stillman, D. When Generations Collide: Who They Are. Why They Clash. How to Solve the Generational Puzzle at Work. Wheaton, IL. Harper Business, Classroom The hard way Top down Hierarchical Unwise Team informed Get out of the way Unsure Once per year Sets me back Seeks approval Command & control No news is good news Uncomfortable Too much and I’ll leave Hub & spoke Horizontal Coach Weekly/daily Unable to work without it Necessary Part of my daily routine Unfathomable if not provided On demand Partner Team decided Collaborative Collaborative & networked Continuous & expected Facilitated Guarded Team included Independent Required to keep me

Key HR Transformation Influencers Male Age 46 Married, 2 children Baby Boomer Career Oriented, Loyal 10 year + tenure Hieratically focused Female Age 32 Gen X, Gen Y Work/life Balance Mobile 3 year – tenure Team/Network focused Employee Past Employee Future

Key HR Transformation Influencers Local Office Stable Profitable Mechanized Hierarchical Caretaker Compliance Global Virtual Nimble Competitive Innovative Flat ROI Governance Employer Past Employer Future

Key HR Transformation Influencers Local Jobs/Positions Grades Skills Salary Tactical Data/Information Reporting Global Teams Broadbands Competencies Total Compensation Strategic Knowledge/Intelligence Predicting Past HR Practice Future HR Practices

Given the current demographic and employee mobility challenges, retaining key employees will become even more important VisionDo individuals see a purpose in what they are doing? OpportunityDo individuals see the opportunity to advance and be recognized for their work? IncentiveDo individuals believe they receive equitable financial and non- financial rewards? ImpactDo individuals see how their work affects the organization? CommunityDo individuals have a social connection to others in the work environment? Communicati on Do individuals have access to information to do their jobs more effectively? Work flexibility Do individuals have flexibility in terms of how, where and when they perform their jobs? Source: Ulrich and Wayne Brockbank. The HR Value Proposition. Harvard Business School Press. Cambridge, 2005, p. 16 Factors influencing the retention of high performing employees

Agenda HR Transformation HR Transformation – beyond HR Transformation Report Card HR Transformation Competencies The Future of the Workforce Technology Foundation – Web 2.0 Measuring the impact of Talent on Business Results

Common Web 2.0 Tools Blogs Interactive discussion led by one individual Wikis Fully collaborative document/website creation Social Bookmarking Track interests and share with others Social Software Organize and connect with others with similar interests RSS Feeds Subscribe to news and changes – syndication Chat Private one-on-one or group interaction Virtual Worlds Meet and interact with others in a virtual world

Tomorrow’s Web 2.0 Work Environment Q3 Budget Review Capital Expenses, KIA Analysis Employee Reviews Acquisition Analysis Stress Reduction Tips Q2 Competitive Analysis KIA Research

Evolving HR Practices Job Fairs, word of mouth Employee surveys Plaques Team building offsites Classroom training All Hands Meetings Traditional Online advertising, referrals Online surveys announcements D-lists, webinars eLearning Replayable Webcasts InternetWeb 2.0Engager Blogging, RSS, Social networking Attraction Wikis, chats, forumsEmpowerment Recommendations, kudos, ratings Recognition Social networking, workspaces Community Informal learning, tagging Development Interactive blogsVisibility

EVOLVING HCM Practices EngagerTraditional Tools Internet-Age Tools Visibility All Hands Meetings All Hands Webcasts, replays Development Classroom training eLearning Community Team building, offsites Community Pages, Webinars Recognition Manager Nominations, plaques Managers and peers submit via s and portal awards Empowerment Question boxes, Employee surveys Online, event driven surveys Attraction Job Fairs, word of mouth Online recruiting, internet employee referral programs

Who’s Adopting Web 2.0?  >75% plan to maintain or increase their investments that encourage user collaboration, social networks, etc.  66% regret not boosting their capabilities to exploit new technologies. More executives said they should have acted faster. Executives Worldwide: The McKinsey Quarterly conducted this survey in January 2007 and received responses from 2,847 executives worldwide, 44% hold C-level positions.

What Web 2.0 Technologies are Being Adopted? The McKinsey Quarterly conducted this survey in January 2007 and received responses from 2,847 executives worldwide, 44% hold C-level positions. Use or Planning to Use

Agenda HR Transformation HR Transformation – beyond HR Transformation Report Card HR Transformation Competencies The Future of the Workforce Technology Foundation – Web 2.0 Measuring the impact of Talent on Business Results

Measuring Human Capital Asset Liability LossProfit People as Means People as Capital People as Problems People as Costs Source: Chapman Condy Company

Why Measure? STOP: “I think….I feel” START: “I know…I can prove” SHIFT: From Tangible to Intangible Asset Accounting

“HR measurement” must move... FROM … Unrealistic expectations for (false) precision Backward looking Discrete training events Reactive Lacks credibility Tactical (micro) orientation No theoretical foundation Attitude/opinion surveys Used for self-justification TO… Appropriate standards of evidence Diagnostic and predictive Development & management Proactive Enhances accountability Strategic (macro) orientation Hypothesis driven Results-focused HR analytics Used for continuous improvement Source : Laurie Bassie – McBassie & Company

Changing the questions that we ask FROM… How do we prove the worth of the HR function? TO… How do we identify those HR programs/policies that would have the greatest positive impact on our key performance indicators? Source : Laurie Bassie – McBassie & Company

Changing the questions that we ask FROM… How do we show a ROI (cost savings) on our HR interventions? TO… How do we link our HR interventions to key performance indicators? Source : Laurie Bassie – McBassie & Company

Changing the questions that we ask FROM… How do I justify/increase our training budget? TO… What are the key differences in the training histories of our top and bottom performers? Source : Laurie Bassie – McBassie & Company

Changing the questions that we ask FROM… How do we maximize employee engagement? TO… What are the critical engagement differentials between top and bottom performing business units/functions? Source : Laurie Bassie – McBassie & Company

Metrics That Matter: Analytic Taxonomy COMPLEXITY IMPACTIMPACT Information Distribution Metrics Delivery (Dashboards) Contextual Embedded Analytics Correlated Analytics Predictive Modeling

People CHRO / CPO Human Capital Knowledge Strategy Global Internet Opportunity Creation / Effectiveness Process Manufacturing MRP VPHR Legal Protector Competencies Client/ Server Efficiency ERP Confluence of HR, Technology and Business From the Industrial Age to the Knowledge Age Local Finance Host Systems Personal Dir Recordkeeping Skills Data Host Automation Mainframe Packages Business Evolution Technology Evolution

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