HR transformation at Sberbank, Lufthansa and Jaguar Land Rover

SUMMARY:

HR leaders from Sberbank, Lufthansa and Jaguar Land Rover at SAP SuccessFactors EMEA conference discuss how they approach HR transformation

SuccessConnect EMEA 2017 customer panel 370px
SuccessConnect customers with SAP CHRO Stefan Ries

While technology is the catalyst for digital transformation of any enterprise, the process of change is led by its people. Therefore the HR function, which touches all of an organization’s people, often finds itself at the forefront of introducing digital technology across the enterprise.

Although the big product news at last week’s SAP SuccessFactors EMEA conference was the introduction of a completely redesigned mobile interface developed in partnership with Apple, the opening keynote focused on the stories of a bank, an airline and a car maker. It’s almost as though the vendor understands that attendees see the technology as inevitable, and that what they really want from the event is to learn from the experiences of others how to introduce it.

These three industries each face massive change as customers adopt new digitally connected forms of interaction and demand a more rounded customer experience. The challenge is summed up succinctly by Yulia Chupina, CHRO at Sberbank, Russia’s oldest and largest bank:

People don’t actually need banks. When they come for a mortgage they actually want a home. You can add other services around it which will enhance their experience and help you stay relevant.

If we want to stay relevant in the game we have to provide a frictionless experience.

HR leading transformation

HR is leading the transformation at Sberbank with a SuccessFactors implementation for its 300,000 employees, which will help modernize how the bank serves the needs of its staff. In the same way that its customers don’t need banks, Sberbank’s people don’t need old-school HR, she says:

You cannot provide a good customer experience if you don’t provide a good employee experience. They want a frictionless experience. They probably don’t need an HR department, they just need services.

The new HR is there when and where people need it, with routine processes automated, and advice and insight readily available. A successful implementation can be a powerful endorsement of a digital strategy, says Julian Simée, senior manager of corporate HR strategy at Lufthansa:

HR has the most touch points with employees of any department internally. If we’re not able to get this transformation right, it’s really difficult to get other departments on this digital transformation journey.

Helping employees perform at their best ensures that the enterprise serves its customers well. That’s essential in today’s market, he says:

[As an airline] there is no tangible asset you’re gaining from us, you’re just using our service. It’s really important you have a good experience, otherwise you’re never going to come back.

At Jaguar Land Rover, the vehicles it makes are going through a dramatic transformation, says HR Leader Jon West:

Automotive is changing. We’re moving from ICE to AEV — from internal combustion engines to autonomous electronic vehicles.

The car maker completed its SuccessFactors roll-out in early 2016 so that its employee experience could keep pace with the kind of experience it delivers its customers, he says:

How can you have an employee experience internally — how can you have a working environment — that doesn’t inspire the same way as our beautiful cars do? There has to be a connection between the two.

We realize that our product is ahead of our employee experience and that’s part of why we made the changes we did.

Reducing cost as an objective

Not all customers begin with digital transformation as the goal. Others are seeking to drive down costs through standardizing on a global, cloud-based HR system. Most end up achieving both — or at least being able to do more with less. At Jaguar Land Rover, HR has been able to limit its own growth while the business continues to expand, says West:

Our change has enabled us to slow the growth down — hold [it] at a very competitive ratio in terms of HR-to-FTE ratio — and still free up some time to be able to go and do the strategic workforce planning.

We’re now able to focus on that rather than administering performance or administering the talent process. That’s a really significant shift in how your HR department can actually add value to the business — trying to unlock the ability for the business to be more productive rather than just having an HR department that is more efficient.

Cost reduction should not be the objective, recommends Lufthansa’s Simée:

Whenever you go digital, no matter what you do, I think it’s the wrong assumption that you’ll be saving lots of money. That should not be your reason for it.

It allows us to do more work, which adds value to the business. That’s something HR in the past has not really been able to do, because we have been so busy just catching up with administration and dealing with extinguishing administrative fires — versus seeing, where does the business need to go? What skills do we have in the organization? What skills do we need in the future? How do we get the workforce, based on the skills that they have, both as efficient and effective as possible into that new world?

Putting users’ needs first

An important element in making sure the new system has a successful introduction is to carefully plan processes that put the user’s needs first. Lufthansa’s Simée explains:

We basically cleaned up our processes and made sure that our processes across our organization are harmonized and simplified, because that is something that we learned pretty quickly.

It sounds pretty horrible but if you have a crap process, making it digital, you just end up having a crap digital process.

We didn’t just make our processes slimmer and more efficient. We thought end-to-end, so we ensured that, what is the customer experience that we want to have?

It’s important to be ready to make changes when it becomes clear a new process isn’t working out, says West.

Some of our process mapping was over-elaborate. We’ve been smart enough to go back and make improvements to make sure that it stays relevant to what people need.

There are one or two cases where we couldn’t resist but put some of those old controls that we thought we needed to have, because they had always been the way we did things. Actually what we did was place a huge burden on the end user and it became patently obvious we needed to do something.

You won’t necessarily get all those interim processes absolutely right first time out of the box. You have to be prepared to accept that sometimes you have to change that.

Managing adoption

While there was some resistance to the move to self-service, overall people at Jaguar Land Rover were more accepting of the new system than the project team had feared, says West.

We almost over-supported people through the change. Actually there was quite a high level of acceptance in what we wanted to do.

At the start there was a lot of, ‘Why are we doing your job?’ The way we manage that is, we make it a lot more fit for purpose and intuitive. Most important is to stay the course and make sure people know what is the why.

Performance appraisals have saved managers a significant chunk of time, notes West. When people experience those benefits for themselves, it aids acceptance of the new system.

All that time that we have reduced is palpable. By definition anything that reduces the amount of time and probably improves the quality of the event is a bit of a no-brainer for the consumer.

More change is coming as a new wave of technology advance looms. The next step is to prepare to use AI-driven conversational interfaces, but first there’s a data collection and harmonization exercise that has to take place. At Lufthansa, harmonizing data across the business has been a difficult nut to crack, says Simée.

We are currently in the debate what is the best way of doing it. We did do in the past, the pick up, lift and drop approach, and that didn’t really work out for us.

We are right now thinking if it might be the wisest idea to have every employee enter their core data at one time in the new system.

To automate conversations, the team will also have to collect information about the content of those conversations, he adds.

In order to go into robotics or even more into bot technology, we need to know two things. One is, we need to know what are the main questions and elements that employees keep on asking, which a bot can take over. Right now we are not having all that data available.

The other thing is we need to have a clean set of core data so that whatever bot you use can correlate to whatever data [that] it’s supposed to take care of.

My take

Further evidence here that moving to cloud-based, digital-first enterprise applications is more than just a technology swap. Organizations have to be ready to rethink their business processes and adjust expectations of how their employees want to work — people are surprisingly ready to embrace these changes.

There are still technology challenges, in particular getting data into shape to support these new ways of working. But most important is to build automated, intuitive processes that help people achieve better results, and which can evolve with continuing transformation.

Image credit - via SAP

Disclosure - SAP is a diginomica premier partner at time of writing.

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