Contenu connexe Similaire à HR Needs Analysis and Cost Estimation (20) Plus de Thu Nandi Nwe (7) HR Needs Analysis and Cost Estimation2. “Failing to plan is planning to fail.”
(Alge & Upright 2009, p.80)
“Use the right tool for the job,” the old saying goes, “and to
use the right tool you have to know what job you’re trying to
do.”
(Meade 2003, p.84)
2
Do you need one?
4. Australian Defence Force
ADF some time ago flagged its intention to replace
the HR systems with a wider solution. In December
2009, chief information officer Greg Farr told
ZDNet.com.au that the department expected to
ditch the "far from perfect" HR systems in 2009 in a
tender worth around $400 million. (LeMay
2009)
http://www.abc.net.au/pm/content/2010/s2815919.h
tm
4
Payroll implementation
5. “Behind every successful HRMS implementation, there
was a thorough needs analysis". You can quote me on
that! I cannot back that statement up statistically,
however, after over 25 years in the business and 10
years of listening to IHRIM (International Association for
Human Resources Information Management) members
share "war stories", I am totally convinced that the
amount of time spent on a thorough needs analysis
before purchasing and implementing a new HRMS is the
best barometer for predicting the success or failure of
the project.” (Doran 2010)
5
6. Michael J. Kavanagh, Mohan Thite, and Richard D. Johnson - Human
Resource Information Systems: Basics, Applications, and Future
Directions, 2e © 2012 SAGE Publications, Inc.
6
SYSTEMS DEVELOPMENT LIFE CYCLE
(SDLC)
Continuous and
iterative nature of
planning and
analysis!
Figure 4.1
7. Michael J. Kavanagh, Mohan Thite, and Richard D. Johnson - Human Resource Information Systems: Basics,
Applications, and Future Directions, 2e © 2012 SAGE Publications, Inc.
Planning
Long-range
Short-range
Analysis
Needs Analysis
Gap Analysis
7
SDLC: Overview
8. Michael J. Kavanagh, Mohan Thite, and Richard D. Johnson - Human
Resource Information Systems: Basics, Applications, and Future
Directions, 2e © 2012 SAGE Publications, Inc.
Design
“Blue print” for the system
Vendor selection
Implementation
Build, test and readied to “go live”
Maintenance
Corrective, adaptive, perfective & preventative
8
SDLC OVERVIEW
9. Michael J. Kavanagh, Mohan Thite, and Richard D. Johnson - Human
Resource Information Systems: Basics, Applications, and Future
Directions, 2e © 2012 SAGE Publications, Inc.
Needs: long-range planning
Strategic
“Big picture”
Phase containment
Needs: short range planning
Operational
Specific projects and programs
9
SDLC: Planning
10. Michael J. Kavanagh, Mohan Thite, and Richard D. Johnson - Human
Resource Information Systems: Basics, Applications, and Future
Directions, 2e © 2012 SAGE Publications, Inc.
Where are we now?
Where are we going?
How are we going to get there?
Revise and revisit these questions
On a regular basis!
10
THE BIG 3
11. Michael J. Kavanagh, Mohan Thite, and Richard D. Johnson - Human
Resource Information Systems: Basics, Applications, and Future
Directions, 2e © 2012 SAGE Publications, Inc.
Dissect and document current capabilities
Identify and prioritize needs
Conduct A gap analysis
Review the feasibility analysis
Determine usefulness of gap analysis in developing
RFP for vendors
11
ANALYSIS
12. Michael J. Kavanagh, Mohan Thite, and Richard D. Johnson - Human
Resource Information Systems: Basics, Applications, and Future
Directions, 2e © 2012 SAGE Publications, Inc.
Current analysis
Use combination of methods:
Interviews
Focus groups
Surveys and online tools
Organizational archives
12
ANALYSIS: WHERE ARE WE NOW?
13. Michael J. Kavanagh, Mohan Thite, and Richard D. Johnson - Human
Resource Information Systems: Basics, Applications, and Future
Directions, 2e © 2012 SAGE Publications, Inc.
Who to ask:
HR functional experts
Job experts
Technical experts
End users
Top management
Consultants and other business partners
13
ANALYSIS: WHERE ARE WE NOW?
14. Michael J. Kavanagh, Mohan Thite, and Richard D. Johnson - Human
Resource Information Systems: Basics, Applications, and Future
Directions, 2e © 2012 SAGE Publications, Inc.
Heart of the needs analysis
Business requirements definition
Point at which organization determines and documents its
current and future needs
Often used interchangeably with needs analysis
Prioritize business and system needs
14
ANALYSIS: WHERE WE NEED TO GO
15. Where are we going?
Strategic vision:
To transform the University’s way of doing business into a
flexible and user-centric portfolio of applications that
integrates all Purdue enterprise data, information and
processes
Helped identify needs in detail and select best
system
Resulted in SAP-HCM
15
Purdue University
17. Michael J. Kavanagh, Mohan Thite, and Richard D. Johnson - Human
Resource Information Systems: Basics, Applications, and Future
Directions, 2e © 2012 SAGE Publications, Inc.
http://www.erp.com/attachments/4074_Accelerated%
20SAP%20Implementations.pdf
17
18. Michael J. Kavanagh, Mohan Thite, and Richard D. Johnson - Human
Resource Information Systems: Basics, Applications, and Future
Directions, 2e © 2012 SAGE Publications, Inc.
Culmination of the needs analysis.
Compares current state of hris with desired state
of hris
What important needs are not being met
What important needs are being met
Important decision making tool for HRIS project
leaders.
18
GAP ANALYSIS
19. Michael J. Kavanagh, Mohan Thite, and Richard D. Johnson - Human Resource Information Systems: Basics,
Applications, and Future Directions, 2e © 2012 SAGE Publications, Inc.
19
HYPOTHETICAL GAP ANALYSIS REPORT
Figure 4.6
20. Michael J. Kavanagh, Mohan Thite, and Richard D. Johnson - Human
Resource Information Systems: Basics, Applications, and Future
Directions, 2e © 2012 SAGE Publications, Inc.
20
THE BIG 3 NEEDS TRIANGLE
Figure 4.7
21. Michael J. Kavanagh, Mohan Thite, and Richard D. Johnson - Human
Resource Information Systems: Basics, Applications, and Future
Directions, 2e © 2012 SAGE Publications, Inc.
Who should determine what our needs are going
forward?
How can we ensure that all of our needs are identified?
How do we limit the scope to the things we truly need?
Is it feasible at this point to implement a system that
can meet our critical needs?
21
NEEDS ANALYSIS: CRITICAL QUESTIONS
22. Basically a Project Management activity
Stipulate objectives, activities, time-frame, costs,
required resources and staff, information
collection methodology
Will help encourage management of project
viability
22
Develop a NA Plan
23. Typically, 2 reports emerge from the NA process
Long, technical, operational document, to guide
system development or selection/purchase
Summary version, to trigger action from top
management
23
Develop the HRIS Strategy
24. Finally, a critical review of the whole process
As a guideline for any future modifications, or
for a new purchase in future years
an analysis of which activities worked well
and which didn’t
a phase possibly ignored by many
organisations (many don’t even do NA’s!)
Discuss alternatives
24
Evaluate the NA Effort
25. There’s no one right way for NA. Every organization is
unique.
Even a token attempt at NA can save a lot of time, money,
effort and heartache.
25
Conclusion
27. Michael J. Kavanagh, Mohan Thite, and Richard D. Johnson - Human Resource Information Systems: Basics,
Applications, and Future Directions, 2e © 2012 SAGE Publications, Inc.
CUSTOMER-ORIENTED PERSPECTIVE OF THE HRM
FUNCTION
Customers
•Line managers
•Strategic partners
•employees
HRM Function
Technology
•Staffing
•Performance
Management
•Rewards
•Training &
Development
Customer Needs
• committed
employees
•competent
employees
All can be measured
Benchmarking & Best Practices
27
28. Michael J. Kavanagh, Mohan Thite, and Richard D. Johnson - Human
Resource Information Systems: Basics, Applications, and Future
Directions, 2e © 2012 SAGE Publications, Inc.
MEASURING HUMAN RESOURCE
EFFECTIVENESS: WHY DO IT?
Market the function
Provides accountability
Demonstrate contribution to bottom line
Cost justify HRM programs
Tie to strategic planning
28
29. Michael J. Kavanagh, Mohan Thite, and Richard D. Johnson - Human
Resource Information Systems: Basics, Applications, and Future
Directions, 2e © 2012 SAGE Publications, Inc.
IDENTIFYING HRIS VALUE
HR moving from being a cost center to profit
center (Cascio, 2000)
Traditional financial measures not sufficient –
Many HR outcomes are intangible, eg. Employee
engagement
Direct (hard) & Indirect (soft) benefits
Implementation costs: Direct (h/w, s/w,
customization); Indirect (lost productivity)
Timing of benefits (short & long term)
29
30. Michael J. Kavanagh, Mohan Thite, and Richard D. Johnson - Human Resource Information Systems: Basics,
Applications, and Future Directions, 2e © 2012 SAGE Publications, Inc.
EVALUATING HUMAN RESOURCE
PRACTICES: APPROACHES
Audit approach – Key Indicators
reviews outcomes of HR functions
benchmarking
Analytic approaches – best
practices
determines whether program had intended
effect/impact: Fitz-Enz
estimates costs / benefits of program
utility analysis: (CBA)
30
31. Michael J. Kavanagh, Mohan Thite, and Richard D. Johnson - Human Resource Information Systems: Basics,
Applications, and Future Directions, 2e © 2012 SAGE Publications, Inc.
BEHAVIOR COSTING APPROACH: VALUE
CHAIN (FITZ-ENZ)
PROCESS
Change
recruiting source
OUTCOME IMPACT
VALUE
ADDED
Shorten time to fill
jobs
Less need for
overtime or
temporary
employees
Cost Savings
31
32. Michael J. Kavanagh, Mohan Thite, and Richard D. Johnson - Human
Resource Information Systems: Basics, Applications, and Future
Directions, 2e © 2012 SAGE Publications, Inc.
HRIS COST BENEFIT ANALYSIS
Language of business is dollars & HR should
learn this language
HRIS CBA: Comparison of projected costs & benefits
Covers full suit of HRIS functionality (transactional/
traditional/ transformational)
HR Metrics: (Table 6.1, Ch.6) Absence rate/ Cost per
hire/ Healthcare costs/ HR Expense factor/ Human capital
ROI & value added/ training costs/ turnover costs/ OHS
costs…
Compare costs/ value within & outside
32
33. Michael J. Kavanagh, Mohan Thite, and Richard D. Johnson - Human
Resource Information Systems: Basics, Applications, and Future
Directions, 2e © 2012 SAGE Publications, Inc.
JUSTIFYING HRIS COSTS
Risk Avoidance strategies (Y2K)
Organization Enhancement Strategies: Increased
revenue or reduced costs due to new/ improved HRIS
Evolution: Manual to automation; web
applications; further improvements will have
incremental not radical benefits; Value add is
seen as more important than cost reduction but
how to measure it?
33
34. Michael J. Kavanagh, Mohan Thite, and Richard D. Johnson - Human
Resource Information Systems: Basics, Applications, and Future
Directions, 2e © 2012 SAGE Publications, Inc.
GUIDELINES TO SUCCESSFUL CBA
Table 7.1
Objective is improving organisational
effectiveness
Be honest with yourself – open mind
Focus on functionality not products
Estimate benefits first & costs later
Know your business
Develop the best estimate possible
Separate CBA from justifying final decision
34
35. Michael J. Kavanagh, Mohan Thite, and Richard D. Johnson - Human
Resource Information Systems: Basics, Applications, and Future
Directions, 2e © 2012 SAGE Publications, Inc.
HRIS CBA INVESTMENT ANALYSIS
Requires three basic pieces of
information
(1) sources of costs and benefits,
(2) an estimated dollar value for each cost and
benefit item, and
(3) the time when the organization will incur
each cost and receive each benefit.
35
36. Michael J. Kavanagh, Mohan Thite, and Richard D. Johnson - Human Resource Information Systems: Basics,
Applications, and Future Directions, 2e © 2012 SAGE Publications, Inc.
HRIS COST BENEFIT ANALYSIS MATRIX:
FIG. 7.1
Direct (Hard) Indirect (Soft)
Benefits Revenue
Enhancement
1
New Revenue
(new sales)
2
Improvement Potential
(better decision making)
Cost Reduction 3
Direct Costs
(cancelled vendor
contracts)
4
Potential Costs
(saved staff time)
Costs New
Implementation
Costs
5
Out of Pocket
Costs
(software,
service
agreements)
6
Indirect Costs
(increased technical
support needs)
36
37. Michael J. Kavanagh, Mohan Thite, and Richard D. Johnson - Human
Resource Information Systems: Basics, Applications, and Future
Directions, 2e © 2012 SAGE Publications, Inc.
EXAMPLE OF AN E-LEARNING CBA MATRIX: TABLE
7.2
Direct (Hard)
Revenue enhancement - Outsourcing e-learning
Cost reductions - Reduced travel expenses
Costs of implementation - Software fee/license
Indirect/Contingent (Soft)
Revenue enhancement - Better customer service
Cost reductions - less lost productivity while waiting
for training
Costs of implementation - Courseware
redevelopment
37
39. Michael J. Kavanagh, Mohan Thite, and Richard D. Johnson - Human
Resource Information Systems: Basics, Applications, and Future
Directions, 2e © 2012 SAGE Publications, Inc.
ESTIMATING INDIRECT BENEFITS
1. Estimating benefit magnitude
2. Mapping benefits to cost or revenue changes
3. Converting magnitude estimates to $s
Eg., Estimating the value of ‘exit interviews’ in
reducing turnover
39
40. Michael J. Kavanagh, Mohan Thite, and Richard D. Johnson - Human
Resource Information Systems: Basics, Applications, and Future
Directions, 2e © 2012 SAGE Publications, Inc.
APPROACHES TO ESTIMATING BENEFITS:
TABLE 7.3
Direct Estimation
Most appropriate for risk avoidance (eg., costs reduced by
employee self-service )
Benchmarking
Build on others’ experience (eg., PeopleSoft implementation
costs in other organizations)
Internal Assessment
Analysis based on specific internal assessments of actual costs
and likely benefits (e.g., activity-based costing)
Mix and match
Using combinations of these approaches
40
41. Michael J. Kavanagh, Mohan Thite, and Richard D. Johnson - Human
Resource Information Systems: Basics, Applications, and Future
Directions, 2e © 2012 SAGE Publications, Inc.
GENERAL CATEGORIES OF COSTS OF
HUMAN BEHAVIOR IN ORGANIZATIONS
Turnover
Absenteeism and sick leave
Effects of Smoking in Work Place
EAP & Wellness programs
Employee attitudes
Labor contract costing
Recruiting
Selection
Job Performance
Training
Career Development
41
42. Michael J. Kavanagh, Mohan Thite, and Richard D. Johnson - Human
Resource Information Systems: Basics, Applications, and Future
Directions, 2e © 2012 SAGE Publications, Inc.
COSTING THE EFFECTS OF SMOKING
Incremental absenteeism
Incremental medical care
Incremental morbidity and premature morbidity
Incremental insurance
Incremental on-the-job time lost
Property damage and depreciation: burns & odors
Reduced maintenance
Involuntary smoking – 2nd hand smoke
42
43. Michael J. Kavanagh, Mohan Thite, and Richard D. Johnson - Human
Resource Information Systems: Basics, Applications, and Future
Directions, 2e © 2012 SAGE Publications, Inc.
COSTING EMPLOYEE TURNOVER
3 components of costing employee
turnover
Separation costs
Replacement costs
Training costs
43
44. Michael J. Kavanagh, Mohan Thite, and Richard D. Johnson - Human
Resource Information Systems: Basics, Applications, and Future
Directions, 2e © 2012 SAGE Publications, Inc.
SEPARATION COSTS
The four components of separation costs are as follows:
Exit Interview
Interviewers time
Termination time
Administrative Functions Related to Termination
Removal of employee from payroll
Termination of employee benefits
Turn-in of company equipment
Separation Pay
Severance packages
44
45. Michael J. Kavanagh, Mohan Thite, and Richard D. Johnson - Human
Resource Information Systems: Basics, Applications, and Future
Directions, 2e © 2012 SAGE Publications, Inc.
REPLACEMENT COSTS
Replacement costs consist of eight components as follows:
Communication of job availability
Pre-employment administrative functions
Entrance interviews
Testing
Staff meetings
Travel and moving expenses
Post employement acquisition and dissemination of
information
Medical examination
45
46. Michael J. Kavanagh, Mohan Thite, and Richard D. Johnson - Human
Resource Information Systems: Basics, Applications, and Future
Directions, 2e © 2012 SAGE Publications, Inc.
METHODS FOR ESTIMATING THE VALUE OF INDIRECT
BENEFITS:
EMPLOYEE TIME SAVED
Average Employee Contribution (AEC)
baseline contribution value by jobs that is consistent
with the actual financial performance of the
organization.
AEC = (Net revenues – Cost of goods sold)/No. of
employees
Individual employee differences (variance) in work
outcomes
variance differences are produced by a large number
of individuals holding equivalent positions
basis for utility analyses for developing contrasting
cost-benefit ratios
46
47. Michael J. Kavanagh, Mohan Thite, and Richard D. Johnson - Human
Resource Information Systems: Basics, Applications, and Future
Directions, 2e © 2012 SAGE Publications, Inc.
THREE COMMON PROBLEMS IN
DEVELOPING AN HRIS CBA
it ignores HR’s more strategic role in improving
organizational effectiveness
in many instances items listed as direct cost reductions
are actually indirect cost reductions
be sure that value estimates assigned to time saved are
reasonable
47
Notes de l'éditeur Despite the age of this source, much of the illustration is relevant. Emphasises how important it is to carry out a thorough CBA.