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5 Ways Technology Is Changing The Face Of HR

Meghan M. Biro

Human resources departments are typically a frenzy of activity, but technology has given HR professionals tools that help reduce administrative tasks so that they can focus on issues that require more hands-on attention.

Before mobile apps and cloud computing, HR was defined by piles of paperwork and a constant struggle to keep up with compliance, hiring, and unending stacks of employee information. By simplifying responsibilities like recruitment, record keeping, and payroll, technology has drastically improved efficiency, accuracy, and even employee morale.

1. Less guesswork as recruitment goes digital

Recruiting new hires is a time-consuming and costly process, but it’s getting easier to find skilled people who are a great fit for your company.

In the past, recruiters would search high and low for employees using face-to-face networking, job postings, and even the newspaper. After winnowing hundreds of applicants to a few for the final interview stage – even to one final individual – some recruiters would find their carefully selected candidates actually fell short. That resulted in both time and money wasted, resulting in the selection of the wrong person for the job.

Between social networks like LinkedIn and pre-employment screening tests, HR departments can now reach a wide audience and more effectively and efficiently evaluate an applicant’s skills and personality, with a view of selecting the right fit for both the position and the company as a whole.

However, the hiring process isn’t the only one that’s been upgraded as a result of technology. We now have both a global and a mobile workforce. The integration of technology into human resources allows us to pair virtual classrooms, sophisticated AV systems that allow face-to-face communication even for remote teams, and/or apps developed specifically for onboarding purposes, and quickly bring a new group of employees quickly up to speed, no matter where they are and no matter what their positions might be.

2. Compliance doesn’t take boxes of paperwork

Staying compliant has often been a major challenge for HR teams. The laws are always changing and often require vast amounts of paperwork and information.

Compliance once required organization and dedicated IT storage capacity, but now technology allows us to securely store data in the cloud. As electronic files, personnel data is easy to search and organize, and can be accessed with a few clicks. Even when HR departments are required to keep employee information for a number of years, it no longer requires file cabinets and expansive storage rooms to keep everything in order and easily accessed.

In fact, the need for any sort of storage has been reduced, if not eliminated entirely, as a result of cloud technology. Forms no longer need to be stockpiled or completed in duplicate, and even government forms are easily accessed online and printed as needed. Everything about this part of compliance on the part of HR pros has been streamlined, which is a great time-saver, as well as a space-saver.

3. Performance management is more accurate

Performance management has long been an important HR function. HR pros have driven the performance management process, monitoring performance, collecting supervisory feedback, and managing the process of regular employee reviews. How did we do this before technology? With time-consuming meetings, performance reviews, and lots of paper. Today, technology has streamlined the process and eliminated a lot of unnecessary steps, while opening an ongoing – and more transparent – feedback loop.

There are many software programs designed to evaluate performance using key performance indicators (KPIs). These programs can be utilized to help HR pros maximize their efforts when it comes to performance management, pinpoint particular areas where an employee (or organization) needs improvement, and put the right systems in place to offer additional training as needed. With the integration of technology into the equation, learning and improvement can be an ongoing process, instead of just an exercise done once a year. That’s better for employees, better for the teams they are a part of, and also exponentially more expeditious for the HR pros managing the performance management process.

4. Pay and benefit information isn’t locked up

Workers like to know how their paychecks and benefits are allocated. How much do they pay in taxes? Are you contributing to a 401(K) or a flex spending account on their behalf? Employees want to see their personal payroll and benefit information without a long delay or jumping through hoops. In the past, this likely meant a lot of work for HR departments.

I’ve spoken before about payroll technology that allows access to this kind of information anytime, from anywhere. Many apps keep things simple by automating recordkeeping and data organization, and let employees explore their data online when it’s convenient for them. Another example of a win-win for everyone, as employees have what they want at their fingertips, and the burden on the HR team, in terms of capturing, updating, and monitoring this information, is greatly reduced.

5. Technology increases engagement

By harnessing the power of mobile and cloud technology in addition to Big Data, businesses have the opportunity to make huge changes for the better. Employee engagement is more important than ever; millennials, who make up the largest portion of the workforce, have repeatedly said they have no qualms going elsewhere if they’re not happy at their jobs.

We’ve talked here before about how technology can be used to attract and retain a younger workforce. Millennials want to be engaged, but it has to be done well. Using technology to manage performance, make the hiring process easier, and give people access to their own personnel information will bring businesses over the threshold that separates the traditional workplace from the modern one.

Artificial intelligence is changing how we live and work, and humans need to be the guides. Learn more in Our Digital Planet: Rise of The Digital Worker The New Breed of Worker.

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How To Design Your Company’s Digital Transformation

Sam Yen

The September issue of the Harvard Business Review features a cover story on design thinking’s coming of age. We have been applying design thinking within SAP for the past 10 years, and I’ve witnessed the growth of this human-centered approach to innovation first hand.

Design thinking is, as the HBR piece points out, “the best tool we have for … developing a responsive, flexible organizational culture.”

This means businesses are doing more to learn about their customers by interacting directly with them. We’re seeing this change in our work on d.forum — a community of design thinking champions and “disruptors” from across industries.

Meanwhile, technology is making it possible to know exponentially more about a customer. Businesses can now make increasingly accurate predictions about customers’ needs well into the future. The businesses best able to access and pull insights from this growing volume of data will win. That requires a fundamental change for our own industry; it necessitates a digital transformation.

So, how do we design this digital transformation?

It starts with the customer and an application of design thinking throughout an organization – blending business, technology and human values to generate innovation. Business is already incorporating design thinking, as the HBR cover story shows. We in technology need to do the same.

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Design thinking plays an important role because it helps articulate what the end customer’s experience is going to be like. It helps focus all aspects of the business on understanding and articulating that future experience.

Once an organization is able to do that, the insights from that consumer experience need to be drawn down into the business, with the central question becoming: What does this future customer experience mean for us as an organization? What barriers do we need to remove? Do we need to organize ourselves differently? Does our process need to change – if it does, how? What kind of new technology do we need?

Then an organization must look carefully at roles within itself. What does this knowledge of the end customer’s future experience mean for an individual in human resources, for example, or finance? Those roles can then be viewed as end experiences unto themselves, with organizations applying design thinking to learn about the needs inherent to those roles. They can then change roles to better meet the end customer’s future needs. This end customer-centered approach is what drives change.

This also means design thinking is more important than ever for IT organizations.

We, in the IT industry, have been charged with being responsive to business, using technology to solve the problems business presents. Unfortunately, business sometimes views IT as the organization keeping the lights on. If we make the analogy of a store: business is responsible for the front office, focused on growing the business where consumers directly interact with products and marketing; while the perception is that IT focuses on the back office, keeping servers running and the distribution system humming. The key is to have business and IT align to meet the needs of the front office together.

Remember what I said about the growing availability of consumer data? The business best able to access and learn from that data will win. Those of us in IT organizations have the technology to make that win possible, but the way we are seen and our very nature needs to change if we want to remain relevant to business and participate in crafting the winning strategy.

We need to become more front office and less back office, proving to business that we are innovation partners in technology.

This means, in order to communicate with businesses today, we need to take a design thinking approach. We in IT need to show we have an understanding of the end consumer’s needs and experience, and we must align that knowledge and understanding with technological solutions. When this works — when the front office and back office come together in this way — it can lead to solutions that a company could otherwise never have realized.

There’s different qualities, of course, between front office and back office requirements. The back office is the foundation of a company and requires robustness, stability, and reliability. The front office, on the other hand, moves much more quickly. It is always changing with new product offerings and marketing campaigns. Technology must also show agility, flexibility, and speed. The business needs both functions to survive. This is a challenge for IT organizations, but it is not an impossible shift for us to make.

Here’s the breakdown of our challenge.

1. We need to better understand the real needs of the business.

This means learning more about the experience and needs of the end customer and then translating that information into technological solutions.

2. We need to be involved in more of the strategic discussions of the business.

Use the regular invitations to meetings with business as an opportunity to surface the deeper learning about the end consumer and the technology solutions that business may otherwise not know to ask for or how to implement.

The IT industry overall may not have a track record of operating in this way, but if we are not involved in the strategic direction of companies and shedding light on the future path, we risk not being considered innovation partners for the business.

We must collaborate with business, understand the strategic direction and highlight the technical challenges and opportunities. When we do, IT will become a hybrid organization – able to maintain the back office while capitalizing on the front office’s growing technical needs. We will highlight solutions that business could otherwise have missed, ushering in a digital transformation.

Digital transformation goes beyond just technology; it requires a mindset. See What It Really Means To Be A Digital Organization.

This story originally appeared on SAP Business Trends.

Top image via Shutterstock

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Sam Yen

About Sam Yen

Sam Yen is the Chief Design Officer for SAP and the Managing Director of SAP Labs Silicon Valley. He is focused on driving a renewed commitment to design and user experience at SAP. Under his leadership, SAP further strengthens its mission of listening to customers´ needs leading to tangible results, including SAP Fiori, SAP Screen Personas and SAP´s UX design services.

How Productive Could You Be With 45 Minutes More Per Day?

Michael Rander

Chances are that you are already feeling your fair share of organizational complexity when navigating your current company, but have you ever considered just how much time is spent across all companies on managing complexity? According to a recent study by the Economist Intelligence Unit (EIU), the global impact of complexity is mind-blowing – and not in a good way.

The study revealed that 38% of respondents spent 16%-25% of their time just dealing with organizational complexity, and 17% spent a staggering 26%-50% of their time doing so. To put that into more concrete numbers, in the US alone, if executives could cut their time spent managing complexity in half, an estimated 8.6 million hours could be saved a week. That corresponds to 45 minutes per executive per day.

The potential productivity impact of every executive having 45 minutes more to work every single day is clearly significant, and considering that 55% say that their organization is either very or extremely complex, why are we then not making the reduction of complexity one or our top of mind issues?

The problem is that identifying the sources of complexity is complex in of itself. Key sources of complexity include organizational size, executive priorities, pace of innovation, decision-making processes, vastly increasing amounts of data to manage, organizational structures, and the pure culture of the company. As a consequence, answers are not universal by any means.

That being said, the negative productivity impact of complexity, regardless of the specific source, is felt similarly across a very large segment of the respondents, with 55% stating that complexity has taken a direct toll on profitability over the past three years.  This is such a serious problem that 8% of respondents actually slowed down their company growth in order to deal with complexity.

So, if complexity oftentimes impacts productivity and subsequently profitability, what are some of the more successful initiatives that companies are taking to combat these effects? Among the answers from the EIU survey, the following were highlighted among the most likely initiatives to reduce complexity and ultimately increase productivity:

  • Making it a company-wide goal to reduce complexity means that the executive level has to live and breathe simplification in order for the rest of the organization to get behind it. Changing behaviors across the organization requires strong leadership, commitment, and change management, and these initiatives ultimately lead to improved decision-making processes, which was reported by respondents as the top benefit of reducing complexity. From a leadership perspective this also requires setting appropriate metrics for measuring outcomes, and for metrics, productivity and efficiency were by far the most popular choices amongst respondents though strangely collaboration related metrics where not ranking high in spite of collaboration being a high level priority.
  • Promoting a culture of collaboration means enabling employees and management alike to collaborate not only within their teams but also across the organization, with partners, and with customers. Creating cross-functional roles to facilitate collaboration was cited by 56% as the most helpful strategy in achieving this goal.
  • More than half (54%) of respondents found the implementation of new technology and tools to be a successful step towards reducing complexity and improving productivity. Enabling collaboration, reducing information overload, building scenarios and prognoses, and enabling real-time decision-making are all key issues that technology can help to reduce complexity at all levels of the organization.

While these initiatives won’t help everyone, it is interesting to see that more than half of companies believe that if they could cut complexity in half they could be at least 11%-25% more productive. That nearly one in five respondents indicated that they could be 26%-50% more productive is a massive improvement.

The question then becomes whether we can make complexity and its impact on productivity not only more visible as a key issue for companies to address, but (even more importantly) also something that every company and every employee should be actively working to reduce. The potential productivity gains listed by respondents certainly provide food for thought, and few other corporate activities are likely to gain that level of ROI.

Just imagine having 45 minutes each and every day for actively pursuing new projects, getting innovative, collaborating, mentoring, learning, reducing stress, etc. What would you do? The vision is certainly compelling, and the question is are we as companies, leaders, and employees going to do something about it?

To read more about the EIU study, please see:

Feel free to follow me on Twitter: @michaelrander

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About Michael Rander

Michael Rander is the Global Program Director for Future Of Work at SAP. He is an experienced project manager, strategic and competitive market researcher, operations manager as well as an avid photographer, athlete, traveler and entrepreneur.

How Much Will Digital Cannibalization Eat into Your Business?

Fawn Fitter

Former Cisco CEO John Chambers predicts that 40% of companies will crumble when they fail to complete a successful digital transformation.

These legacy companies may be trying to keep up with insurgent companies that are introducing disruptive technologies, but they’re being held back by the ease of doing business the way they always have – or by how vehemently their customers object to change.

Most organizations today know that they have to embrace innovation. The question is whether they can put a digital business model in place without damaging their existing business so badly that they don’t survive the transition. We gathered a panel of experts to discuss the fine line between disruption and destruction.

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qa_qIn 2011, when Netflix hiked prices and tried to split its streaming and DVD-bymail services, it lost 3.25% of its customer base and 75% of its market capitalization.²︐³ What can we learn from that?

Scott Anthony: That debacle shows that sometimes you can get ahead of your customers. The key is to manage things at the pace of the market, not at your internal speed. You need to know what your customers are looking for and what they’re willing to tolerate. Sometimes companies forget what their customers want and care about, and they try to push things on them before they’re ready.

R. “Ray” Wang: You need to be able to split your traditional business and your growth business so that you can focus on big shifts instead of moving the needle 2%. Netflix was responding to its customers – by deciding not to define its brand too narrowly.

qa_qDoes disruption always involve cannibalizing your own business?

Wang: You can’t design new experiences in existing systems. But you have to make sure you manage the revenue stream on the way down in the old business model while managing the growth of the new one.

Merijn Helle: Traditional brick-and-mortar stores are putting a lot of capital into digital initiatives that aren’t paying enough back yet in the form of online sales, and they’re cannibalizing their profits so they can deliver a single authentic experience. Customers don’t see channels, they see brands; and they want to interact with brands seamlessly in real time, regardless of channel or format.

Lars Bastian: In manufacturing, new technologies aren’t about disrupting your business model as much as they are about expanding it. Think about predictive maintenance, the ability to warn customers when the product they’ve purchased will need service. You’re not going to lose customers by introducing new processes. You have to add these digitized services to remain competitive.

qa_qIs cannibalizing your own business better or worse than losing market share to a more innovative competitor?

Michael Liebhold: You have to create that digital business and mandate it to grow. If you cannibalize the existing business, that’s just the price you have to pay.

Wang: Companies that cannibalize their own businesses are the ones that survive. If you don’t do it, someone else will. What we’re really talking about is “Why do you exist? Why does anyone want to buy from you?”

Anthony: I’m not sure that’s the right question. The fundamental question is what you’re using disruption to do. How do you use it to strengthen what you’re doing today, and what new things does it enable? I think you can get so consumed with all the changes that reconfigure what you’re doing today that you do only that. And if you do only that, your business becomes smaller, less significant, and less interesting.

qa_qSo how should companies think about smart disruption?

Anthony: Leaders have to reconfigure today and imagine tomorrow at the same time. It’s not either/or. Every disruptive threat has an equal, if not greater, opportunity. When disruption strikes, it’s a mistake only to feel the threat to your legacy business. It’s an opportunity to expand into a different marke.

SAP_Disruption_QA_images2400x1600_4Liebhold: It starts at the top. You can’t ask a CEO for an eight-figure budget to upgrade a cloud analytics system if the C-suite doesn’t understand the power of integrating data from across all the legacy systems. So the first task is to educate the senior team so it can approve the budgets.

Scott Underwood: Some of the most interesting questions are internal organizational questions, keeping people from feeling that their livelihoods are in danger or introducing ways to keep them engaged.

Leon Segal: Absolutely. If you want to enter a new market or introduce a new product, there’s a whole chain of stakeholders – including your own employees and the distribution chain. Their experiences are also new. Once you start looking for things that affect their experience, you can’t help doing it. You walk around the office and say, “That doesn’t look right, they don’t look happy. Maybe we should change that around.”

Fawn Fitter is a freelance writer specializing in business and technology. 

To learn more about how to disrupt your business without destroying it, read the in-depth report Digital Disruption: When to Cook the Golden Goose.

Download the PDF (1.2MB)

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How Disruption Will Cause The Insurance Industry To Change

Joe Pacor

Digital transformation is changing our world, and the insurance industry cannot sit idly and avoid these changes. It’s expected that the digital customer experience will drastically drive insurance profitability in the years to come. Over 50% of insured clients won’t recommend an insurer that doesn’t have digital interaction options. An overwhelming 61% of customers prefer to track their claim status digitally instead of contacting the insurance company or agency through more traditional means. It’s estimated that 79% of insurance executives recognize the need for innovation, but are having problems with daily operations. Over 60% see both opportunities and threats in the digital transformation process. At the same time, 74% of insurance executives feel they don’t have the necessary skills to drive the needed changes.

How does your company adapt to such a changing landscape? One common way approach is updating existing business models. Many companies have already been successful in driving digital transformation through a wide range of channels. Online-only insurance solutions and faster approval times are emerging in some companies. Others are turning to e-aggregator platforms to  keep their business afloat while changing company practices and assets to the digital economy.

Here are a few examples of promising companies and how they’re innovating to meet disruption.

Esurance

Esurance started in 1999 as an online-only business. With over five million customers, it has seen rapid growth since its beginnings. And because the insurer started out with a direct insurance digital approach, it is ahead of the game in terms of digital transformation since many competitors are still struggling to move away from their agency-based model.

Though it’s not available nationwide, it has become available in 43 states, which is still significant growth for a company that is not yet 20 years old. Esurance offers much lower rates, due to its direct insurance approach that cuts out many middleman expenses. As one of the first direct insurance companies, it is still catching up to competitors for customer service, but may very well be an example of future insurance company operations.

Haven Life

When it comes to fast approval, Haven Life has Big Data science down perfectly. This MassMutual spin-off claims it can approve most customers for new term life insurance in about 20 minutes. The company bases its decision on motor vehicle records from the state, prescription drug information, a customer questionnaire, and other data available to the company. The quick decision process will make the company much more popular among individuals seeking insurance policies under $1 million. As the system is based entirely online, it reduces agency costs significantly.

Moneysupermarket

In the UK, a newer e-aggregator platform helps customers compare prices and purchase insurance online. Moneysupermarket provides fast access to other online services as well. It was launched in 1999 as a digital-only solution that compares mortgage rates. In 2003, the insurance portion of the platform began with a mission to save at approximately 10 million households at least £200 through competitive shopping.

The company streamlines the process by having the prospect fill out a single form. That information is then used to pull quotes from multiple insurance companies. The prospects can compare the different policies to see which one is the best fit for their situation. They can then either select and purchase at that time or come back at a later time to finish the process. The company benefits by seeing additional sales at a much reduced cost compared to traditional marketing channels.

The role Big Data plays

Insurance businesses are also forming new business networks to provide a more tailored product to clients. As an example, State Farm and ADT provide a paired offering that protects connected homes through a single service. This helps customers reduce the number of businesses they must work with. At the same time, both companies benefit with increased business as customers turn to the network for simplicity.

Meanwhile, the Internet of Things is creating a new level of hyperconnectivity and data harvesting behind the scenes. Insurance rates currently based on a doctor’s visit will instead draw information from wearable devices, workout records, and pharmacy records. Rate reductions for self-driving cars will be based on the percentage of time the car is driven by a human versus driven autonomously.

With all these changes disrupting the industry, remaining flexible and connected makes all the difference. Is your company ready to meet the changes digital transformation is causing? If you aren’t, it is time to look at options to become more agile.

Learn more about how we can help you meet the challenges of disruption head on today. Please download our Insurance White Paper “How Insurers Can Prepare for the Digital Revolution” today to see what SAP has to offer. We will work with you to develop an insurance business that’s ready to meet the needs of the digital world.

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About Joe Pacor

Joe Pacor is senior director, Industry Cloud Marketing-Insurance at SAP, responsible for driving the growth of SAP's value proposition as a technology provider, trusted business partner, and thought leader for the insurance industry.