Optimizing Your Payroll and HCM Technology. Providing You the Keys to Transformation

Optimizing Your Payroll

and HCM Technology

Providing You the Keys

to Transformation

Agenda

 Today’s HCM Environment

 Getting Strategic

 ADP’s HR/Payroll Technology Optimization

Assessment

Today’s HCM

Environment

HCM Technology Goals

 Consistent and Seamless Information Access  Increased Workflow Efficiencies

 Improved Internal and External Communication  Improved Real-time Decision Making

The Dilemma

“Most Organizations don’t know yet how to use their HRIS, and how to make it connect to the kind of things

Getting Strategic –

How to Optimize your

HRMS

HRMS Strategy

 Design a strategic plan for the HRIS aligned with the overall objectives of HR/Payroll

 Define current state process gaps, and map out

approaches for the required changes for future state

strategies, including those currently not supported by the HRIS

 Analyze the impact and implications of the proposed changes within the organization

 Identify and prioritize the initiatives, as well as develop a cost/benefit analysis, if applicable

Step 1 - Begin With The

End In Mind

“Begin with the end in mind means begin each day, each task, or project with a clear vision of your desired direction and destination, and then continue by flexing

your proactive muscles to make things happen”

Cedar Crestone HCM Application Blueprint

Step 2 - Define the

Current State of

Processes

Define current state process gaps, and map out approaches for the required changes for future state strategies, including those not supported by the HRIS.

Utilize Process Flows

set to run a pay cycle PR 2.0 PR 2.2 Balancing & audit reports E mp loy ee Ok? No Yes _Standard reports Payroll to General Ledger interface Payroll to A/P or 3rd _party interface Payroll to tax acct’g or 3rd _party interface Other internal interfaces Pay calculations executed PR 2.1 PR 2.5 Third Party Interfaces

(benefits, taxes, bonds, savings plans,…) Third Party generates checks- advices PR 2.4 Banks (Positive pay, direct deposit) Transmit / process final pay calc PR 2.3

Step 3

– Score Yourself

Run data anomaly reports to measure data quality and

determine clean up efforts required

Data Anomalies

1 employee under the age of 16 exists in the database 227 employees have “unusual” dependent records

187 employees and spouses are both electing benefits 15 employees have over-age dependents with no

disability or student status

348 employees are non-married with spouses on file …

Importance of Data Quality

 To ensure the information and reports produced by

your HRIS are meaningful and are able to be used to for decision making by Management, the data entered must be accurate, complete, and consistent

 Poor data quality, missing information and

inconsistent use of established codes creates errors in employee paychecks, benefits eligibility and

enrollment, 401k eligibility and enrollment and compliance reporting

 It’s everyone's responsibility to ensure the data they

Step 4 – Assess

Organizational Impact

Analyze the impact and

implications of any proposed changes within the organization

19

CHANGE Model

C

H

A

N

G

E

Challenge the Current State

Harmonize & Align Leadership

Activate Commitment

Nurture & Formalize Design

Guide Implementation Evaluate & Institutionalize the Change

SOURCE: Thriving Through Change: A

Leader’s Practical Guide to Change Mastery,

The American Society for Training and Development and Elaine Biech © 2007, Publisher: ASTD

Change is Hard

20

Gartner, and Independent IT research firm as cited in Delivering Transformational Change: European

Business Review March 3, 2013.

For major corporate systems [change] investments:

o 28% are abandoned before completion o 46% are behind schedule or over budget

o 80% are not used in the way they were intended to be or not

used at all six months after installation.

Having a clever strategy is not enough—and successful organizations should proactively develop the internal capacity to implement change faster and more effectively than their competitors. Many so-called failures are actually change projects that have been partially “installed”, rather than fully “implemented”. The organizational, strategy, process and

technology components of a change initiative may have been put in place effectively, but are not being applied or used in the intended way with the required level of understanding, commitment and personal ownership. People readily slip back into their old ways of working when change leadership efforts are prematurely withdrawn.

Step 5 - Prioritize

Identify and prioritize the

initiatives, as well as develop a

Transformation

 Training

 Data Analysis/Clean up

 Business Process Development

Strategize:

 Executive Steering Committee

 Planning/Vision

 Define Success Measure

Transform:

 Leverage /Upgrade Technology

 Centralize Services

ADP’ Technology

Optimization Process

The HR Technology Assessment is used to learn about the current status of your application, and to provide transformation strategies where the status is found to be “off-target” from generally accepted best practice definitions. During the initial assessment effort, we focus on a number of target areas or dimensions which, based on our experience, are critical to optimal processing and system

utilization.

The process includes a series of intensive, process-based interviews involving subject matter experts. The information gathered from these interviews is delivered as:

 Summary findings

 Detailed findings by dimension

 Short, mid and long term recommendations

 Summary of recommendations per finding

Optimization Process Objectives

 Review overall HR technology strategy with leadership team to understand current issues and future state vision  Identify areas of decreased efficiency and opportunities for

improvement in both the HR and Payroll areas

 Provide recommended strategy for migration to desired future state

 Identify opportunities to fully utilize your technology

solutions beyond basic HR and payroll functionality, and determine areas for process and application improvement and scalability

Optimization Process Overview

 During the Assessment phase, ADP resources conduct interviews with the client team to better understand current areas of concern and obstacles to transforming to the desired future state

 As part of the Communicate phase, ADP resources analyze all information gathered from the discussions and interview

sessions. Findings are presented to the client to highlight

significant issues and potential trouble spots within the current environment. Short, mid and long term recommendations for improvement are identified

 The final phase of the process, Transform, requires recognition by the leadership team that change needs to occur, and

acceptance of the recommendations and resolutions included in the findings, will support repeatable and sustainable work

Topics Discussed During Interviews

 Core HR, Benefits and Payroll Transactions

 Future Desired State

 Supporting Application Functionality

 Data Elements

 Process Models/Custody of Tasks

 Audits/Compliance

Dimensions/Points of Impact

 People/Skills Alignment

 Business Process/Application Configuration

 Controls and Security

 Reports and Interfaces

 Program/Change Management

 System Performance

 Production Management

Results of the Process

Resulting data is presented within the eight assessment

dimensions and rated within a Red / Yellow / Green score.

 Red - Significant issue and must be addressed

 Yellow - Warning and may impact quality or efficiency

Summary Findings

Dimension Summary Rating

People/Skills HR users are not comfortable with the full capability of the current system,

prohibiting them from recommending change, and creating redundancy in data capture. HR users feel they do not have the time or resources to devote to additional education, knowledge transfer and process improvement

Business Process/ Application

Security

Lack of functionality in some implemented applications (Recruiting/Benefits) and underutilization of others (HRIS) have created the need for numerous manual processes which are time consuming and have the possibility of producing inconsistent results

Controls/Security System security is administered and monitored appropriately. However,

historical lack of analytical and audit experience in critical areas (Payroll) has created reactive rather than proactive audit of overall data

Reports/Interfaces Inadequate integration between key systems causes duplication of data entry

and increased risk of error

Production Management

No formal processes in place for requesting application changes, implementing enhancements, or testing new functionality

Program/Change Management

Sustainability of change and new initiatives is impacted by lack of formal corporate governance over use of HR technologies

System Performance

Resolutions to system issues are not formally tracked, therefore client is not able to consistently leverage prior knowledge or address root cause of recurring issues

Enabling Opportunities

Lack of fully implemented self-service and workflow functionality creates

redundant manual processes causing Human Resources staff to be mired down in daily transactional processing rather than focusing on valued-added HR planning and consulting activities

Sample - Total Findings by Dimension

People/Skills Business Process Controls/ Security Reports/ Interfaces Program/ Change Management Production Management System Performance Enabling Opportunities Green Yellow Red

In the end…………

 Implement the changes while focusing on the realization of the ROI