Transcending the Tactical: Strategic SAP Solutions for Increased HR Productivity

Executive Summary Talent recruitment and retention are essential for maintaining a competitive edge in todays economy. This effort requires an effective Human Resources (HR) organization capable of implementing sound strategies in alignment with the companys overall business objectives. While tactical HR transactions like payroll processing and benefits selection are necessary for basic business functionality and regulatory compliance, they often drain capital resources and limit productivity. Research shows that transcending the tactical HR paradigm and investing in strategic HR capabilities is the key to achieving sustained business performance and costeffective infrastructure. SAP HR can enable companies to achieve this goal. However, the systems complexity must be addressed to allow for substantial progress to occur. Simplified, user-friendly interfaces can increase productivity with decreased resources, thus generating savings and freeing HR professionals to focus on strategic, value-added tasks that bring long-term success. This paper discusses the benefits of investing in strategic HR capabilities and demonstrates how Winshuttles solutions can effectively streamline SAP HR functionality for optimal business use.

2011 Winshuttle, LLC. All rights reserved. 10/11

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Introduction
CEOs are fond of saying, Our people are our most important asset, but how many companies act as if that was truly the case? Everyone agrees that acquiring, developing, and retaining top talent is critical to success in modern economy. In many organizations, however, Human Resources (HR) professionals who should be taking the lead on this front instead spend their time on core HR activities like payroll processing and benefits selection, which are necessary but of limited strategic value. The true value of an integrated Human Capital Management (HCM) system like SAP HR is not simply cost reduction; it is enabling the organization to transcend the tacticalto move beyond core HR tasks and develop HCM strategies that contribute to long-term business success.

The Value of Strategic HR

Modern HR professionals differentiate between tactical and strategic HR to distinguish the day-to-day activities of managing a workforce from the more forward-looking and purposeful tasks that help the organization pursue its business goals. Tactical HR refers to transactional activities like payroll processing, benefits enrollment, and employee separation. These are necessary functions, but they are primarily seen as cost drivers. HR departments that deliver only on this minimal level are typically ignored by executive and business decision-makers and are noticed only when they fail to deliver. Strategic HR refers to activities such as talent identification and retention, workforce planning, and succession management, which go beyond day-to-day transactions and seek to maximize the potential of the organizations human capital. An HR department that demonstrates impact on employee productivity, provides valuable data to decision-makers, and participates in long-range planning is seen as a valuable resource, not merely a cost center. The perception that strategic HR is more valuable than a merely tactical one has been confirmed by research. HR consultancy Bersin & Associates developed a four-level maturity model that ranks companies HR capabilities from the most tactical, which they label Compliance Driven HR, to the most strategic, labeled Business Integrated HR. Their research shows a clear correlation between enhanced strategic approach to HR and higher revenue per employee, a key indicator of business performance (see Figure 1). 1

Figure 1: Revenue per employee in relation to strategic HR competency (source: Bersin & Associates)

OLeonard, Karen; Harris, Stacey. The HR Factbook 2011,Bersin & Associates

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Companies that invest in strategic HR also do better on employee engagement surveys. Employee engagement is a modern concept that measures an employees involvement with, commitment to, and satisfaction with work (Schmidt et al 1993) and is strongly correlated with higher productivity. In its 2011 HR Executives Agenda survey, Aberdeen found that companies that pursued strategic HR imperatives reported significantly higher employee engagement scores. Despite the clear business value of investing in strategic HR, most HR departments still spend most of their time and money on tactical activities. Bersin & Associates estimated that almost 60% of 2011 HR spending has gone to tactical activities, with only 8% allocated to truly strategic HR programs and initiatives. In Aberdeens 2011 HR Executives Agenda survey, respondents cited too much time on tactical HR activities as the number one internal barrier to pursuing more strategic HCM priorities. For many companies, the disproportionate spending on tactical activities is not a conscious choice but the manifestation of a dilemma. Companies cannot afford to fail at tactical HR activities: Employees must be paid, and regulatory requirements must be met. Yet, intensified focus on tactical HR success can be a barrier to investing in more rewarding and valuable strategic HR capabilities.

The Foundation of Strategic HR

The challenge for organizations is to transcend the tacticalto implement systems that accomplish core HR processes and transactions more efficiently, thus laying the foundation for greater investment in higher-value strategic HR. A simple focus on cost-cutting or outsourcing is not enough. Companies must drive down the cost of performing transactional HR without compromising on service and free up HR professionals to use their expertise to pursue activities that further the organizations strategic objectives (see Figure 2).

Succession planning Leadership development

Employee engagement Labor relations Talent development Payroll processing Benefits election Job application Personal data
Figure 2: Transcending the TacticalDecreasing HR costs while increasing HR value

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Technology plays a key role in achieving these goals. Aberdeen recommends investments in three areas for reducing time and money spent on tactical HR: Automation to reduce manual transactions and data processing Integration to eliminate process leaks and hand-offs between disparate HR systems Self-service to enable employees and managers to perform common HR processes unassisted Effective optimization of core HR tasks can significantly lower operational costs and increase strategic business value, as discussed below. Automation: As many core HR processes are data-intensive, reducing the time spent on manual data entry and other processing tasks can improve accuracy and save money. Unfortunately, many companies are going in the opposite direction. In its 2010 report The Future of Core HR, Aberdeen noted that a third of survey respondents reported an increase in manual HR transactions from the previous year. Companies striving to succeed in todays competitive marketplace must make sure that their systems can accommodate the increasing complexity of the work environment without backsliding into less efficient processes. Integration: Outsourcing HR functions has become an increasingly popular cost-savings measure, and even companies with internally centralized HR organizations have to deal with outside agencies, such as banks, benefits agencies, and government regulators. At the same time, more stringent compliance oversight has led to increased expenditure associated with inaccurate and incomplete data. The result is a greaterthan-ever need to ensure accurate and secure flow of information among disparate HR systems. Whether companies choose outsourcing or shared services, or ERP or purpose-built systems, they must ensure that the components of their systems are well governed and well integrated. Self-service: One of the biggest innovations in core HR delivery in the last ten years has been adoption of the Employee and Manager Self-Service (ESS/MSS) applications. A well-designed ESS/MSS portal can deliver substantial savings (see Table 1), with the added benefit of freeing up HR professionals to focus on more strategic endeavors. A poorly designed portal, however, can have the opposite effectturning HR into tech support for confusing user interfaces, out of date information, and missing functionality.

Table 1: Savings from Employee and Manager Self-Service Implementation

Process Salary Change Approve Promotion Create Job Requisition Performance Appraisal

Original Cost $33.50 $36.48 $27.67 $59.73

Self-Service Cost $18.26 $14.01 $11.11 $47.60

% Savings 45% 62% 60% 20%

Source: Cedar Crestone 2008 Value Report

Investing in the above-listed areas is the key to transcending the tactical. Companies that can deliver high-quality core HR services at a low cost have a solid foundation on which to build an HR system with greater strategic capabilities.

ERP Usability as a Strategic HR Enabler

Companies that choose SAP HR as their core HRIS system are at the forefront of the tactical vs. strategic dilemma. SAP HR has extensive functionality that can deliver the three enablers for transcending the tactical: automation, integration, and self-service. However, the complexity of the system and the demands it places on HR professionals, employees, and IT can make it less of a foundation for greater value and more of an impediment to innovation and development.

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The key to unlocking SAP HRs true potential is increased usability: simplifying and streamlining core functions to make them more usable by employees and less dependent on IT expertise. The main pillars of ERP usability are: Speed: Among the single biggest complaints lodged against SAP is the sheer amount of time it takes to enter data and execute transactions. This is particularly true in a function like HR, where record-keeping and information management are core components. Speeding up these common tasks frees up valuable resources to focus on more strategic activities. Accuracy: Inaccurate data is the bane of any system, and the complexity of the SAP interface makes it a constant concern. With its reliance on dynamic actions and cascading updates, the HR function is particularly vulnerable to this issue. Simplifying data entry to reduce errors, as well as data maintenance to find and correct errors, can deliver substantial cost savings. Efficiency: Speed and efficiency are often used interchangeable. However, efficiency implies something much greater than speed. An efficient system is one in which all resources are used to their maximum potential. This is the essence of transcending the tactical: freeing up capable HR professionals to use their expertise on higher-value, strategic endeavors. Improving SAP usability removes the artificial barrier of arcane knowledge and allows all individuals in the process to focus on the activity of the highest value. Innovation: SAP is designed to reduce business to a set of defined processes. This is a critical step in standardizing and optimizing the many tasks and functions required to run a modern company. For continuous improvement to occur, however, the ability to recognize and suggest process improvements must be dispersed throughout the organization, and the development cycles to implement such improvements must be reasonably short.

Transcending the Tactical with Winshuttle Solutions

As a premier provider of SAP usability solutions, Winshuttle delivers products that help companies get the most out of their SAP investment. The Company focuses on improving the six use cases that define SAP user interaction (see Table 2). Winshuttles core expertise is reducing the cost and improving the efficiency of transaction and data processing-intensive activities that define tactical HR.
Table 2: SAP use cases

Data Entry

Entering data using the SAP interface is time consuming and error prone. Winshuttle products provide simplified UI and rapid automation using familiar tools like Microsoft Excel and Microsoft SharePoint to speed up data entry without sacrificing accuracy.

A constantly changing business environment requires constant updates to data and Data Maintenance process rules. Winshuttle tools simplify the process of finding and updating data across multiple tables and records. Data Extraction Data Integration Data Migration Data Action The data stored in SAP is a resource for understanding the condition of the business. Winshuttle tools simplify the creation of custom queries for analysis and reporting. Connecting disparate users and systems to SAP is a constant challenge. Winshuttle products allow users to build templates and workflows that shuttle data into and out of SAP and preserve data integrity and compliance. The Winshuttle suite of products helps users upgrade to a new version of SAP or from a legacy system by automating the mass transfer of data and process rules. Winshuttles codeless development tools allow the rapid development of applications and workflow routines that enable a business to respond quickly to the demands of customers and the competitive environment.

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The key to transcending the tactical is improving the efficiency of transactional activities and companies that have deployed Winshuttle solutions have achieved measurable performance improvements in key SAP HR transactions (note Table 3). These companies are reaping immediate benefit from lower costs and are laying the foundation for future investments in strategic HR capabilities.
Table 3: Measured productivity improvement with Winshuttle solutions

Hire to Retire Transaction Description Actions for Position Maintain HR Master Data Maintain Organizational Unit Maintain Plan Data (Action- Based) Maintain Plan Data (Menu- Guided) Maintain Plan Data (Open) Maintain Position Personnel Actions Time Sheet: Maintain Times

SAP Transaction Code PQ13 PA30 PO10 PP03 PP01 PP02 PO13 PA40 CAT2

Average Seconds Saved per SAP Update with Winshuttle H2R Script 198 83 54 88 77 68 78 170 125

Conclusion:
Enhancing strategic HR capabilities while decreasing tactical HR costs can enable companies to develop efficient workforce, improve productivity, and increase revenue. Investing in a technology-driven platform like SAP HR is the key to transcending the tactical barrier. In addition, effective measures must be taken to optimize the systems operational efficiency and usability. Winshuttle has developed reliable solutions for optimizing SAP HR platforms, leading to measurable productivity improvements, cost reduction, and time savings that drive long-term success. To estimate your potential H2R process time savings, multiply your number of SAP H2R records by the average seconds saved per SAP record processed shown in Table 3. For more information about how Winshuttle can help your company get the most out of your SAP HR and your entire SAP investment, visit www.winshuttle.com or email info@winshuttle.com.

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Winshuttle is the ERP Usability Company, providing software products that enable business users to work with SAP directly from Excel, Web forms and other interfaces without any programming. Winshuttle focuses on a simple fact when using SAP applications, time is money. Winshuttles usability solutions radically accelerate SAP user transactions, saving and redirecting millions of dollars for SAPs customers every day. These financial benefits are achieved by significantly reducing employee and contractor costs and increasing resources to address more strategic priorities. Thousands of customers use Winshuttle to make their SAP lives easier. Headquartered in Bothell, Washington, Winshuttle has offices in the United Kingdom, France, Germany, and India. For more information, visit www.winshuttle.com.

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