Balancing Digital Service with Human Service

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More and more companies are relying on technology for the bulk of their communications with their workforce, customers, and vendors. Lockdowns starting in 2020 moved millions of people to work from home and accelerated adoption of online communication tools. We live with less human interaction than ever before.

Technology seems to be undermining the meaningfulness of interactions we do have with others. We are more disconnecting from the real world and isolated from each other. The trend is pervasive in our society. Many of us work from home, order Uber Eats regularly, and buy nearly everything online. Instead of being with friends, coworkers, and family, we text or instant message.

Technology may be a convenient way to communicate, but at what cost is the convenience? Is sacrificing the meaningful social learning and personal engagement worth the time savings?  As Aerosmith’s Steven Tyler and Richie Supa wrote in the song, Amazing: “Life is a journey not a destination.”[1] Will society regret its move toward increasingly less socialization?

And the trend toward human-free interactions in business is really gaining steam. The business world around us is changing. We know that face-to-face interaction is proven to provide us with important benefits. Everything from a sense of well-being to enhancing credibility and trust—whether it’s with friends or cashiers at the checkout line. Even the Albertsons chain that rolled back self-checkouts in favor of cash registers with humans is already revisiting self-checkout through smart carts,[2] likely due to increase pressure to produce profits, gain analytics, and reduce staffing requirements.

Socializing is an important part of the fabric of humanity. Texts, emails, CRM tickets, and chatbots are rapidly replacing personalized customer service interactions with scripted, cold, and impersonal electronic communication. It may be more cost effective, but ultimately how will this trend impact your business? 

What is the hidden cost of replacing people with technology?

  • How does it make your customers feel?
  • How does the lack of human customer service affect your brand message?
  • What is the impact on customer loyalty and customer retention?

Ten texts or ten emails can’t even begin to approach the value of a few minutes of human interaction with a well-trained, cheerful, and engaged customer service guru when a customer is in need. Yes, a smiley-face emoticon is cute, but it will never replace the ability to serve your customers personally. Face-to-face interactions with other real humans could rapidly become the most premium service of all.

Consider the following recent observations from a recent job seeker and freelance writer.  Amanda Claypool applied for jobs at Waffle House, Crumbl Cookies, McDonald’s, Wendy’s, and Hardee’s. Writing as a freelancer for Business Insider, Amanda shared that: “I successfully landed a part-time job as a server at Waffle House and it was the only one with a human point of contact during the application process.” Every other job required her to “correspond with chatbots and automated emails” that left her “annoyed and uncertain” and suggesting “Adding more human contact, rather than less, could be one way to solve the problem.”[3]

There’s something real and valuable about real human interaction. Humans strive to be together. Over centuries, humans have built villages, towns, cities, major business center, and large universities campuses all with the intent to bringing humans together. We instinctively know how important and productive it is to have real world interaction with your circle of friends, coworkers, potential employers, and the essential service people that make up your everyday world. We know that these important human connections aren’t the same once reduced to automated text-to-voice or chatbot applications.

There is no substitute for personalized service. Smart businesses will invest in both technology automation tools and customer service people to provide their customers with the ultimate service options: leading service with human interactions and allowing customers to optionally consume technology self-help tools at their convenience. This approach will strike the right balance between digital service and real human interactions.

[1] Quote Investigator. https://quoteinvestigator.com/2012/08/31/life-journey

[2] CNBC. (2022 May 19). Grocery chain Albertsons to start using self-checkout carts. https://www.cnbc.com/video/2022/05/19/grocery-chain-albertsons-to-start-using-self-checkout-carts.html

[3] Claypool, Amanda. (2023 June 9). Chatbots Made It Almost Impossible for Me to Get a Job. Business Insider. https://www.businessinsider.com/chatbots-made-it-hard-to-get-fast-food-job-2023-6.

People Operations Digital Transformation

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By Richard Cangemi

A People Operations Digital Transformation project can take on different looks and priorities but the goal is always the same. The transformation project strives to make talent and technology seamlessly connected creating processes that are more efficient with happier workers that drive greater business value.

A few examples of digital transformation objectives are:

  • Going paperless with electronic employee onboarding, e-documents, benefit enrollment, and performance reviews.
  • Delivering training and learning courses virtually.
  • Connect employees to the company and managers by giving them a relevant voice and recognition for milestones and achievements using 360 feedback tools such as online chat, badging, pulse surveys, and company news feeds.

For those new to the digital transformation process or new to People Operations, the following five steps are a good place to start your planning.

1. Assess the current state of your People Operations across your organization

The idea here is to understand how your current business processes work. Ask yourself: are we reasonably meeting the current demands of our business, customers, and employees? Involve your stakeholders and get buy in into the best way forward. Identify the potential areas of improvement and how PeopleGuru digital technology can contribute to your long-term business goals. Document your current state and areas that can be improved by the PeopleGuru deployment.

2. Define your People Operations transformation objectives.

Once you know the main pain points within your People Operation, you need to understand what exactly you want to transform. And don’t transform just for the sake of transformation. Make sure each initiative has a specific purpose. You should identify the business processes that could be streamlined, cost reductions, data points that matter most, or competitive advantages that you will gain. You goal should be to document your People Operation transformation objectives and gain signoff from all stakeholders.

3. Outline your People Operations transformation roadmap

An incremental approach to your transformation is always the most practical. Prioritize the areas for improvement that are most impactful and move systematically toward your goals. Set milestones and celebrate success along the way. This will help you keep the process on track and minimize the chance of failure.

4. Establish Clear Project Leadership

A dedicated team with a strong internal leader is essential for ownership of the implementation of your People Operations transformation strategy. If you already have qualified staff in-house, you should assign responsibilities according to your strategy and your staff’s aptitudes. If not, you best option might be to temporarily augment your staff to fill in the areas of expertise that you need.

5. Empower and educate your staff

Don’t let your People Operations transformation efforts be in vain because your employees refuse to adapt to change. Be sure that your corporate culture keeps up with the transformation agenda. Communicating to your staff the why for change will help you gain full buy-in to your transformation agenda.

The key to every transformation project is great planning, leadership, and communication. And the latter can’t be understated. Taking extra time to inform staff about the benefits of their new tech tools and improved work processes must not be overlooked or underplayed. Having all stakeholders bought-in to your transformation agenda will help ensure that any hiccups in your digital transformation project won’t slow or stall your overall goals to deliver more efficiency, happier workers, and greater business value .

THE UNINTENDED CONSEQUENCES OF PTO POLICIES

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Paid time off is arguably the most important benefit that a company can provide to its workforce. It is an essential safety net because even the shortest sickness without pay is a financial hardship for most.

According to Forbes, 78% of employees are currently living paycheck to paycheck. Paid time off is hugely popular. In fact, employee’s rate vacation and paid time off as more important than pay raises, according to this Glassdoor survey. And there is a lot of research that suggests that taking time off is essential to maintaining high levels of employee engagement, productivity, and reduction in burnout. It’s important to note that in seventeen states and in a growing number of counties, paid time off is a mandatory employer benefit.

And it’s not just time off you have to consider. A comprehensive paid time off policy will cover all the following types of paid leave: vacation, personal, sick, jury duty, holidays, bereavement, parental leave, military leave, and sabbatical leave.

If you’re thinking about providing a PTO benefit to your employees, ask yourself:

WHAT BEHAVIORS SHOULD I INCENTIVIZE?

A common consequence of bundled PTO banks is that they incent workers to come to work ill so they can save their PTO days for planned vacations and other fun activities. Given the state of the pandemic and the current trend of emphasizing wellness, companies might find separating sick and vacation banks beneficial to both workers and the organization.

WHAT BEHAVIORS SHOULD I DISCOURAGE?

Your policy should discourage an employee from exhausting all of their paid time off and then later in the year not having a PTO bank to cover time off for a sickness. This can create financial hardship for the employee and puts the employer in the ugly position of leaving an employee unpaid or partially unpaid.

WHAT ARE UNINTENDED CONSEQUENCES OF MY TIME OFF POLICY?

Your policy can be a powerful recruiting tool. Job seekers favor unlimited paid time off policies, but these polices treat new and loyal employees the same way. Rewarding loyal, long-term employees with additional paid time off is no longer an option.

SHOULD I BANK IT ALL TOGETHER OR SEPARATE INTO SEPARATE BUCKETS?

Employers in places like California that ban single banks must provide a time off policy that exclude sick days from time off banks.

WILL UNUSED TIME BALANCES ROLL OVER OR IS IT A USE-IT-OR-LOSE-IT PLAN?

In a use-it-or-lose-it scenario, many employees, through lack of planning, simultaneously use time off at year-end resulting in hardship to the business operation. Colorado and California prohibit use-it-or-lose-it policies. Under those laws, vacation pay is considered a form of wages. GAAP accounting requires that employers who allow a carryover feature record that liability on their balance sheet from year to year.

SHOULD EMPLOYEES BE ALLOWED TO CASH OUT UNUSED PTO HOURS?

From a GAAP accounting standpoint, the PTO payout provision creates extra work for accounting departments as the accruing potential time off payout liability to employees must be calculated and included monthly financial statements.

SHOULD I PAYOUT EARNED TIME OFF UPON TERMINATION OF EMPLOYMENT?

Yes, you should, as many states require employers to payout earned time off at termination and it’s the right thing to do. Moreover, a motivated terminated employee can do a lot of reputational damage to a former employer on social media and other job seeking websites.

DOES YOUR EMPLOYEE HANDBOOK CLEARLY COMMUNICATE YOUR TIME OFF PLAN FEATURES?

Legal advice is essential, as you’ll need to ensure that your PTO plan design meets the requirements of your state and local laws. A clearly and concisely written paid time off policy ensures your time off benefit is a source of positive vibes; a poorly communicated plan will leave you and employees frustrated. Your final plan should be comprehensive covering things like expected working hours and a clear definition of all of the following types of paid leave: vacation, personal, sick, jury duty, holidays, bereavement, parental leave, military leave, and sabbatical. If you operate in multiple locations that have conflicting laws, then you may need to supplement your policy with location specific language.

DOES YOUR TIME AND LABOR SYSTEM OR PAYROLL SYSTEM AUTOMATE THE POLICY FEATURES AS DESIGNED?

Don’t design a plan that you have to administer manually. Make sure your plan design is supported by technology. A great time and labor system will handle the periodic accruals based upon tenure and job, carry-overs, and resets from period-to-period, and even payouts. Manually computing time off is a huge time suck and without detailed accounting, you can find yourself in heated arguments with your most valuable employees.

To maintain high levels of employee engagement, productivity, and a reduction in employee burnout employers need their workers to use their time off benefit. It’s essential that your paid time off policy incentivizes employees to schedule and use their earned vacation time and also provide adequate sick time so employees aren’t financially pressured to come to work and spread illnesses. Most importantly don’t skip the legal advice. Laws are constantly changing so be sure to check with a lawyer to be sure your PTO plan design meets the requirements of your state and local laws.

Types of PTO

HR All Trumped Up

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donald-trump-administrationRegardless of party affiliation or politics, the first 100 days of the any new presidential administration are expected to bring change. The Trump administration is no different in that regard. He has made promises to voters and has gone as far as presenting a contract with America. With the Republican party controlling both the house and the senate, the Trump Administration has a good chance of executing on some of its promises in its first 100 days’ plan.

For our audience of HR folks, what challenges will Trump’s first 100 days present?[i]

There are 4 key points in the position statement from Trump-Pence that will likely affect HR in the first hundred days of a Trump administration. [ii]  Here’s what that could look like for HCM:

  1. Repeal and Replace Obamacare Act. Precisely what Trump would hope to avoid by repealing ACA may become an unintended consequence. The national dialog regarding repealing and replacing the Affordable Healthcare Act will likely create more uncertainty about the future of employer sponsored healthcare in the workplace. Proposed changes to HSAs could radically increase the popularity of these programs. With the potential for accumulated HSA amounts available to pass between members of a family and onto the next generation, and HSA and a high deductible health plan may become the new normal.
  2. End The Offshoring Act. Companies that offshore production work, manufacturing, or even software development work should begin the planning process to reconsider if those decisions will be beneficial longer term under a Trump administration.
  3. End Illegal Immigration Act. Besides building a wall that Mexico will pay for, the Trump Administration plan to end illegal immigration will likely push E-Verify to the forefront as an employer mandate.[iii] HR departments should embrace this technology now. It works well enough, and it is always in your best interest to hire legally authorized individuals, so there’s not downside to getting started with E-Verify immediately.
  4. Middle Class Tax Relief And Simplification Act. The Trump Administration will likely roll out new payroll tax brackets early in 2017. I would also expect that HR departments will have to enroll employees in a new class of IRS approved payroll deductions for dependent care and elder care with matching contributions from the Federal government.

Ready or not, the first 100 days will bring HCM to the forefront as we respond to both new and anticipated legislative changes and executive orders.

[i] Trump, Donald. (11 Nov. 2016). Donald Trump 1st 100 Days.

http://www.npr.org/2016/11/09/501451368/here-is-what-donald-trump-wants-to-do-in-his-first-100-days

[ii] DonaldTrump.com. (2016). Healthcare Reform to Make America Great Again. Accessed 11 Nov. 2016 from https://www.donaldjtrump.com/positions/healthcare-reform

[iii] Moody, Kathryn. (9 Nov. 216) What President Trump with mean for HR. HRDive.com. Accessed from http://www.hrdive.com/news/what-president-trump-will-mean-for-hr/430062/

VC investment alters the HR technology landscape

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hr_investment_bargraphBillions of dollars invested in HR technology companies have created a handful of new and reborn one-size-fits-all HCM vendors who made a big splash on the HR scene throughout 2015 and 2016. Not to be outdone, niche HR specialist vendors have upped the ante with some very compelling niche products targeting recruiting, performance, learning, compliance, and social collaboration. Choice is always a good thing for HR departments. How does all this investment in HR technology companies change the way HR executives think about using technology within their operations? 

To best-of-breed or not to best-of-breed? That is now the question.

There is no question that current thinking leads HR executives toward single-vendor-fits-all approach for HCM over using multiple best-of-breed niche software providers. The best-of-breed approach may gain favor as convenient and reliable data exchange service to core HR platforms mature. I’m seeing this trend occur with SMB accounting and sales automation providers now supporting data exchange to financial institutions, POS, fulfillment services, lead sources, and even benchmarking data. I expect the HR space to follow suite making a best-of-breed solution approach more viable for HR executives to consider in the future.

A new category is born—The Social Workplace.

Facebook, Google, and Microsoft are all well-positioned to Socialize the workplace. Social tools at work have the potential to reinvent tracking time, electing benefits, performance management, training, and coaching. This goes much deeper that LinkedIn or Glassdoor—think Facebook, SharePoint, and GoToMeeting combined. In fact, Facebook is already in the game with Workplace by Facebook (https://workplace.fb.com/) launched in late 2016. Gaining access to the employee’s wallet will be the holy grail for Social Workplace vendors, and HR is positioned as the epicenter to be the gatekeeper and policy maker for this new category. I’m concerned that many HR executives are too overwhelmed with day-to-day workload to properly address this opportunity. So, jumping into bed with Facebook may be convenient but not in their companies’ best interests. There are so many issues to consider: security, privacy, data ownership, productivity, etc. It’s HR’s ball to carry right now, and I’m hopeful that HR executives prioritize their time so they can lead the charge to carefully, thoughtfully, and safely deploy Social Collaboration in their workplaces.

Regulations grow exponentially; strategic outsourcing is HRs only hope to keep up.

With all good intentions government continues to burden companies with new reporting and regulation. With the expansion of E-Verify, EEOC, health and welfare laws, efforts to curb tax refund fraud and change tax brackets, the coming compliance burden continues to grow. We’ve learned from the ACA that new employment laws can be anything but a routine and predictable compliance job during their initial rollout. Already understaffed HR departments should strategically outsource these duties to specialists because when you bake in the true cost of doing the work yourself, outsourcing is truly more affordable and reduces compliance failure risks at the same time.

On premise software bites the dust.

Technology investments have favored Cloud vendors exclusively since investors like the advantages of the Cloud business model with shorter development cycle times, a single code base across the customer base, a streamlined support experience, and out-of-the-box integrations with third-party vendors. These things are all made possible by the Cloud software business model. The Cloud business model also does away with version upgrades costs and aligns customer and vendor interests around a stable and compelling product version which reduces the demand for support. That benefits both parties. Vendors are rewarded with lower costs and clients are rewarded with a better product and lower total cost of ownership. As most software vendors exclusively align their products to cloud deployment, on premise software becomes a relic of the past.

The billions of investment dollars in the HR technology space over the past five years has created new choice for HR departments. HR executives should look to outsource the increased burden of compliance to leave them bandwidth to focus on strategic technology investments such as Social Workplace tools and Human Capital Management software. Arguments will still be made for a single vendor solution, but a best-of-breed approach may gain more favor soon. Either way, HR needs to exercise caution with adequate due diligence in the vendor selection process. Don’t pick a vendor solely on technology demonstrations. A vendor that is too focused on feature-packing and super growth and not enough on customer service can be a nightmare to deal with. Nothing can make up for bad partner choices and failed implementations. The cost, aggravation, disruption, loss of time, and negative hit to your reputation as an HR leader is unrecoverable.

HR Cloud 9 requires a great ecosystem

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woman_cloudHR Cloud 9 is being in a state of perfect contentment with your HR ecosystem. Getting to HR Cloud 9 isn’t a trivial matter, and it isn’t about choosing one vendor to handle everything. The choices you make when building out your HR ecosystem will either form your utopia or nightmare. To get to HR Cloud 9, consider how your ecosystem will fair in the following areas. If you do, you’ll be well on your way to Cloud 9.

You want intimate customer service experience that is highly accessible and feels like an extension of your staff. Vendors that strive for an intimate customer service relationship take customer service to a different level. Service personnel staff have relevant up-to-the-minute information such as sales orders, setup documents, and all service history. Each and every service staff member has the requisite and relevant industry and product expertise to be knowledgeable and helpful to customers. Customer service people who are empathetic and highly value the voice of the customer. They are reliable, interchangeable, efficient, and effective in resolving customer service issues and exceeding customer expectations. This is more than just responding quickly. Each customer exchange is a seamless, predictable experience, and a customer is never asked to retrace or rehash a service issue. And for those issues that require more than a few days to achieve resolution, service staff clearly communicate timelines and resolution expectations to mitigate misunderstandings upfront.

You want software designed the way HR people think and works the way it’s expected to. Great HR software is built with the end user in mind. The HR user experience should mirror the way HR people think and work. The manager experience should complement the managers’ work and work day. The employee experience should be designed for casual use and promote communication and feedback to encourage engagement and recognition behaviors, which lead to happy workers. Don’t settle for clunky and hard to use. There are way better options today. This applies to HCM and more. Today, the Girl Scout’s Digital Cookie™ app[i] is used by Girl Scouts to “gain new business and social skills in an entertaining and engaging way.” Your HR Cloud 9 needs this too.

You need speed and accessibility because lack of speed and accessibility kills productivity. Review service level agreements for reasonable up-time guarantees and response time measures for all major application functions. If you require access at remote locations or via mobile devices, verify that your solution supports those forms of access. Most cloud vendors use a shared infrastructure of web servers, applications servers, and database servers that are accessible via the public internet. Many cloud vendors do not offer exclusive use to a single organization, so performance can be impacted by what other users are doing at any given time. Don’t get bogged down by poor performance; it’s a real drag and a time suck.

You need to be sure that the vendor’s solution “box” of capability is big enough for your needs. A single code base is another key tenant of modern HCM systems. A lot of Cloud providers have application policies to customize look and feel and even some parts of the customer experience. So, that doesn’t necessarily mean that every customer is stuck with the exact same user experience. But it does mean that code customization for the unique need of a single customer is not supported. Keep in mind that mature solutions tend to have a bigger “box” of capability that allows more organizations to be easily supported by the product. Choose solutions that meet your needs today and for the near future.

You need an evolved reporting capability that shields end-users from complexity. Modern HR Cloud software solutions are built on large data repositories with comingled customer data because this is most efficient and affordable for them. This multi-tenant design requires programming to separate customers logically and adds complexity to data reporting. Techniques like de-normalized database views and metadata layers facilitating intuitive data relationship, grouping, and summaries go a long way toward enhancing the productivity of a reporting user. Ultimately, the best approach eliminates all reporting complexity by abstracting the data relationships from the end-user altogether. This yields point and click report definitions, grouping, and summaries in the most user friendly format available and ultimately makes the reporting function available to a greater cross section of your organization.

You need good support for system integration, data imports, and data exports. Supporting the data needs of the various executive that an HR department services means getting data in and out of the system in a secure and efficient manner is an essential requirement. Employee loads, time imports, carrier feeds, G/L files, and published web service integration points are just a few examples. Don’t get painted in a corner with cloud solution that doesn’t meet your integration requirements.

Achieving the perfect ecosystem for your HR function could mean multiple vendors.[ii] Look for each of those vendors to provide an intimate customer service experience, fast and reliable access, flexible software capabilities that meet your current and future needs, a user experience that mirrors the way people work, and reporting and data extraction that don’t require a programmer to use.

Choose your partners wisely and be on HR Cloud 9.

This blog was written by Richard Cangemi, Chief Executive Guru at PeopleGuru™. This post may not be copied or published without permission.

[i] Girl Scouts. Digital Cookie 2.0. GirlScouts.org. Retrieved from https://www.girlscouts.org/en/cookies/all-about-cookies/digital-cookie.html (accessed 18 August 2016).

[ii] Fosway Group Limited and Decebo®. (July 2015). Integrating the HR Landscape on the Cloud. Retrieved from http://www.cedma-europe.org/newsletter_articles/misc/Integrating_the_HR_Landscape_on_the_Cloud_(Jul_2015).pdf

Dark clouds of vendors are hanging over us

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Do you listen to who uses your software?  Are you really listening to those who are responsible for the success of the project and your product? Or have you completely deprioritized your existing clients’ needs due to the constant push for new customers and revenue growth? Are you slamming customers onto the software without regard to their unique needs and befuddling and disappointing stakeholders and end users with lack of tangible results from their investment and hard work? Are you forcing new clients to compromise core objectives to accommodate overly optimistic go-live dates? Do you feel compelled to be a jack-of-all-trades and showcase feature parity with competitors hijacking your development roadmap leaving your product a mile wide and inch deep?

In my experience, the answers to these questions are now too often “Yes,” which is a strategy that is short sighted and sure to backfire. Bloated, hard-to-use software, rushed implementations, and low user satisfaction rates are not a recipe for success or growth. They are the recipe for failure. Cloud software vendors need to rethink their priorities and focus on change in the following areas.

Feature parity and one-upping your competition consumes development pipelines.

Rebalance priorities from adding new features to simplifying user experience.

It’s so easy to get caught up in a feature parity race and checking all the boxes on RFP responses that you completely neglect making the experience intuitive and creating the mobile-friendly experience that users desire. Your priorities are skewed toward taking orders while the needs of an existing, loyal user base are missed. The software gets bigger, more bloated, and harder to use. Users’ reject the software because the added features actually take them backward not forward. This alienates your users and lowers customer satisfaction. That consistently results in client losses over time.

Conversion of data in and out of the system is way too hard.

Step up to the plate and provide tools to make transforming data to and from your system fast and easy. 

Do vendors make it is hard to extract accurate and complete data from their system so they can’t easily be fired? Is conversion of data into a new system overly technical where it requires the use of expensive professional service resources just because the vendor wants the professional service revenue? Cloud based systems are often inherently inefficient and time consuming for data entry. Getting data into the cloud has been the Achilles heel of the industry. Vendors that do nothing to assist their users with data conversion features leave their customer between a rock and a hard place.

There is little focus and no vendor commitment to achieving the users’ desired outcomes and process improvement opportunities are ignored.

Truly engage as a partner ensuring that customers desired outcomes are fully met.

Once you’ve signed a contract with your cloud software vendor you’ve now begun a race to the finish line. Why is that? What is the rush? Is it because the vendor needs the client to go-live to recognize the revenue? Understanding user needs and business needs and then tweaking the software to meet those needs adds time and complexity to an implementation project. It’s faster and easier to ignore the uniqueness of each customer and conduct a vanilla implementation. Vanilla is what some Cloud software vendors push.

The result is an initial implementation with many missed opportunities for process improvement. Simply moving your current way of doing things over to a new system without thoughtful consideration of how the new system can be leveraged to improve things will likely perpetuate existing problems and inefficiency.  It is shame for Cloud vendors to railroad and marginalize users this way. It is not just a common courtesy, it is an obligation, for a vendor to ensure that their clientele isn’t hurried through implementation so that each client can get the most of their software investment.  As some claim Einstein said1, and as Rita Mae Brown wrote in Sudden Death, “Insanity is doing the same thing over and over again, but expecting different results.”2

Cloud vendors would be smart to wise up and address some serious strategic problems that stem from their insatiable desire to add new clients at the expense of taking care of the ones they already have.

1 Becker, Michael. (2012 Nov. 13). Einstein on misattribution: ‘I probably didn’t say that. Becker’s Online Journal. Retrieved from http://www.news.hypercrit.net/2012/11/13/einstein-on-misattribution-i-probably-didnt-say-that/

2 Brown, Rita Mae. (1983). Sudden Death. (pp. 68) New York: Random House. Retrieved from https://books.google.com/books?id=QJj9VqInFyUC&pg

HCM – Transition to Strategic and Predictive, Highly Engaged and Highly Productive

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HCM Implementation Hierarchy

Phase 1 – Wage and hour, payroll and tax compliance requirements

Like food and shelter are to Maslow’s Hierarchy of Needs, Phase 1 HCM needs are fundamental to successful existence for any organization. An HCM implementation ensures these needs are fully met first.

Even mid-sized companies can struggle with Phase 1 needs and can find themselves in a fight for their lives. This can be due to growth spurts, mergers or acquisitions. Growth in employee counts, geographical footprint or revenue, all subject the company to governmental regulations including the Affordable Health Care Act, multi-jurisdictional taxation, and wage and hour law requirements, which strain an over-committed and growth-oriented management team. Spreadsheets, small-business payroll outsourcing and paper approvals are overwhelmed by sheer volume, inefficient procedures and duplicate processing. Information is lost, entered into systems multiple times, or otherwise inaccessible, inaccurate and/or ignored by managers.

I’ve seen first-hand how disruptive Wage and Hour or Department of Labor audits can be without the underlying recordkeeping to properly support the company; a costly event in precious time, legal fees, and fines. I have also witnessed dishonest employees and managers falsifying timesheets and payroll records literally robbing a company of payroll funds for years. Those management teams were preoccupied with growing the business and just didn’t have the proper HR systems in place to protect their company adequately.

Make no mistake that organizations with Phase 1 needs can be exciting companies with an impressive growth story, compelling products and services, and a management team engaged in fueling the rocket with talent and capital. And often those same managers are savvy enough to recognize that to continue their impressive growth story hinges on fixing these foundational HR issues.

Phase 1 of the HCM implementation is all about reduction in the number and complexity of manual paper-based payroll transactions to ensure accuracy of management reporting and compliance with governmental regulations. This means deploying HCM features like:

  • A system to facilitate daily collection of time and labor (biometrics as needed) with manager oversight and approval directly fed to payroll.
  • Enterprise level payroll processing with the controls needed to ensure proper federal, state, and local taxation and labor allocation broken out by the needs of the company, whether that be by location, department, project, job, and/or task. That information is ultimately reportable and fed to the general ledger so the organization has a true picture of its spending in the various areas of its business.
  • HR recordkeeping practices are transitioned from small-business payroll, spreadsheets, and paper to an electronic system so this information is touched once and compliant with governmental regulations and can be managed efficiently.

Phase 2 – Improve transactional efficiency and productivity

Phase 2 is largely about workflow automation and can account for a good portion of the return on investment projected for the entire HCM project. Paper processes and duplicate work are transitioned to a vastly more efficient framework of system workflows and notifications. The organization benefits greatly by using Employee and Manager Self Service as data entry and approvals can be handled one-time and at their point of origin. Employee adoption of self-service is key to this phase and will likely require cultural reinforcement from top management.

The Phase 2 implementation delivers the benefits of HCM features like:

  • Employee Self Service allows employees to help themselves via a mobile device or web browser to view or modify information about themselves, including time-off requests, timesheets, compensation, and benefits. This feature reduces the demand for HR and managers to service enquiries from employees.
  • Manager Self Service empowers supervisors to manage information for their direct reports via a mobile device or web browser and to approve requests for time-off, payroll, benefit, or schedule changes online and in real-time.
  • System workflows and notifications streamline approval processes that are uniquely programmed to adhere to company policy, inform all relevant decision makers and collect electronic approvals.

Phase 3 – Talent Management

Phase 3 is about Talent Management features such as Recruiting, Onboarding, Benefit Enrollment, Performance Management, Salary Administration, and Career Development. Each of these capabilities addresses a specific area of the Human Resource function with a mobile and web-based capability to engage employees and supervisors in administering this work conveniently and efficiently. Careful attention must be paid to the foundational system workflow policies to ensure that the companies underlying HR policies are respected at all times.

  • Recruitment features include branded candidate mobile and web portals for job seekers, assessment and review tools for hiring managers, and system workflows to guide candidates through the process of completing job applications, screening questionnaires, interviews, and ultimately the offer process.
  • Onboarding walks a newly hired employee through the hire process, collecting relevant information and signatures for hiring paperwork.
  • eDocuments eliminate the paper documents and replace them with a mobile and web-based presentation and repository system that records signatures and document versioning.
  • Performance management provides for talent assessments, performance reviews, and succession planning with employee, supervisors, directors, and peers all engaged in the feedback loop.
  • Salary Administration distributes salary increases and bonus assignments across the entire organization respecting department, division or location budget requirements and engages the decision-makers with a multi-step approval process. Once all sign-offs are made, the system records employee and payroll changes seamlessly.
  • Automate Benefit Administration using online enrollment, carrier eligibility feeds and billing reconciliation tools. Employees enroll in benefits online and changes in those enrollments are conveniently fed to carriers electronically.

Phase 4 – Social HCM and Predictive Analytics

Phase 4 is for the most committed, sophisticated, and engaged management teams. These organizations consider human capital vital and invest accordingly striving to achieve a highly-productive workforce that is highly-engaged, and this can be an elusive goal. It’s not as simple as implementing system features. An employee engagement philosophy of teamwork, collaboration, rewards, and recognition is vital along with a management commitment to transparency to the drivers of the business. And the benefits can be tremendous with productivity gains and improved employee retention. It’s a simple fact that recognition, now distributed and administered by the system, can play a big part in employee retention and productivity. As Tom Peters co-wrote in Excellence, “…the simple act of paying positive attention to people has a great deal to do with productivity.” The Social HCM acts as both a conduit for teamwork and collaboration, and it speeds the feedback loop between project stakeholders and contributors to help keep projects and people on track.

Phase 4 is focused on the following initiatives:

  • Predictive Analytics provide a real-time, deep, and intuitive understanding of your organization and transparency to reveal the drivers of the business.
  • Social Collaboration features foster an engaged workforce enabling employees to easily build relationships, cross-collaborate, learn, share knowledge, and ultimately improve productivity.
  • Recognitions and rewards capabilities provide a framework for consistent, fair and public recognition to those deserving such accolades. Automation of badging and awards with points tracking removes the chore of reconciling points for redemption of gifts or other company rewards.

This phased methodology makes transitioning to a strategic, predictive, highly-productive, and highly-engaged workforce an orderly and controllable process. Of course, getting to the top of the pyramid requires real commitments to transparency and a philosophy that engages and rewards employees.

For organizations that aspire to be strategic, predictive, highly-productive, and highly-engaged, a modern HCM is just too compelling of a technology for those businesses to ignore.

References

McLeod, Saul. (2007/2014). Maslow’s Hierarchy of Needs. Retrieved from http://www.simplypsychology.org/maslow.html

Peters, Thomas J., Waterman, Robert H., and Austin, Nancy. (1992). Excellence: In Search of Excellence and A Passion for Excellence. (pp. 94). Quality Paperback Book Club. Retrieved from https://books.google.com/books?id=scy5AAAAIAAJ&dq

The Corporate Psycho

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psychoThe Corporate Psycho is an individual who systematically lies, coerces, intimidates, or otherwise instills fear in coworkers in the pursuit of power within an organization.

Hiring this person is your worst nightmare. They look great on paper and maybe their references even check out, but you will wish—no you will pray—that you didn’t hire them. And once part of your team, the psychopath will systematically and maliciously agitate and sabotage the efforts of coworkers.

The Corporate Psycho is a predator and you are its prey.

The Corporate Psycho has a self-serving agenda with no moral compass. They systematically oppress individual contributions with the intent to disrupt productivity and foster malcontent. They are deceitful and insincere in their relationships and communications. Once inside your department, the Corporate Psycho will destroy the quality of your work life and relationships by undermining the key ingredient to a functional workplace: TRUST. Once in the throes of chaos created by the Corporate Psycho, coworkers lack trust and confidence in each other. Finger-pointing and assessment of blame thrive. New challenges and problems surface, and nothing seems to work like it used to. Even the things that were easy are now hard. Productivity drops, deadlines are missed, quality suffers, negativity thrives, absenteeism skyrockets, and most good people move on to greener pastures. And then your department suffers more as it is placed under the microscope of upper management. That was the Corporate Psycho’s plan all along: to create the chaos and then take advantage of that chaos.

What makes the Corporate Psycho so treacherous?

They are psychopaths and very skillful liars, and they believe that their views of the world are more enlightened than others. They have total disregard for people and treat them as a means to end. They befriend only as a means to gain information and power and then use this information to disrupt order and promote their own agenda. Once the workplace is in chaos, they win over vulnerable leaders by promoting an insider’s view of how things really are going in-the-trenches. Only they are misleading leaders with lies peppered with just enough truth to seem credible and actionable. And the cost of the Corporate Psycho is substantial.

With an adult population consisting of 1% to 2% psychopaths in the general population,1 you are very likely to encounter a Corporate Psycho in your ranks. Consider the following outcomes directly attributed to an onboard Corporate Psycho:

  • Less engaged workers are less productive. The Gallup organization estimated that an average of 18% actively disengaged employees cost the economy as much as $450 to $550 billion dollars per year in lost productivity including absenteeism, illness and other low morale issues.2
  • According to Cornerstone OnDemand, good employees are 54 percent more likely to quit when they work with a toxic employee.3 Replacing employees is expensive and for skilled workers can easily exceed $10,000 per hire.

How do you defeat the Corporate Psycho?

The key to defeating a Corporate Psycho is to recognize the agenda early and to disrupt any maniacal plans.

Recognize the warning signs. Identify potential Corporate Psychos by their telltale traits. This person may appear to fit in at first, but then you will begin to notice the signs. It won’t take long for this person to gain trust and set their plan in place. Assess whether this coworker is working on a separate agenda, refuses to follow protocols, is overly negative, or two-faced and insincere in communications and dealings with others. Ask yourself:

  • Does this individual proclaim to be a rigid follower of protocol but in reality is not?
  • Does this person seem overconfident and display a superiority complex with others?
  • Are they willing to do whatever it takes to ascend in the company?
  • Is there a general disregard for others’ contributions?
  • Does this person take credit for others’ work?
  • Does this person generally take issue with authority?

Once a suspect is identified as a potential Corporate Psycho, govern your behavior accordingly.

Don’t be bullied. The Corporate Psycho needs your help to promote an agenda, so don’t be a victim. If you suspect you are working with a Corporate Psycho, don’t accept advice or share information, unless it is a requirement of your job. Keep your distance. The inner workings of your job and the difficulties of your workday should be kept between you and your boss. Be sure not to put the Corporate Psycho in a position to fight battles on your behalf with your supervisors. They will not represent your best interests. And resist the temptation to get baited into negativity directed to the company or other coworkers.

Document everything. When dealing with a suspected Corporate Psycho, document every exchange with this person. Keep a log by writing down the time, place, and detailed notes so you can reconstruct the substance of your meeting. Remember, this person is a psychopath – he/she will not expect you to document your interactions as they view you as too “weak” to foil their plan. When things get chaotic you’ll be glad you documented because you will be in a position to justify your actions with your supervisors.

The Corporate Psycho thrives via a web of backchannel and under-the-radar relationships and information. The most successful of which appear to be sincere, charming, smart and engaging communicators. They systematically instill fear, mistrust, and incite negativity with the goal of making you believe that they are essential to survival in the new world order. Your high standards and moral compass are the best way to rise above any chaos created by the Corporate Psycho. Because ultimately we all need the confidence and trust of our coworkers workers to be successful. As Warren Bennis said, “Trust is the lubrication that makes it possible for organizations to work.”4

Footnotes

  1. PsychVisit.com. “Course and Prevalence of Antisocial Personality Disorder and Psychopathy” http://www.psychvisit.com/conditions/antisocial-personality-disorder-psychopathy/5-course-antisocial-personality.html (accessed 23 Nov. 2015).
  2. Susan Sorenson and Keri Garman. “How to Tackle U.S. Employees’ Stagnating Engagement,” Gallup, 11 June 2013, http://www.gallup.com/businessjournal/247/high-cost-disengaged-employees.aspx.
  3. Cornerstone OnDemand, “New Research Exposes the Hidden Costs of ‘Toxic Employees,’” 31 March 2015, https://www.cornerstoneondemand.com/news/press-releases/new-research-exposes-hidden-costs-toxic-employees.
  4. Robert Tucker, Innovation is Everybody’s Business: How to Make Yourself Indispensable in Today’s Hypercompetitive World (Hoboken: Wiley & Sons, 2011), 157.

When you dance with the gorilla, it is the gorilla who decides when you stop

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A disagreement between ADP®, one of largest payroll processing companies, and Zenefits™ a self-described startup that recently raised $500 million at a $4.5 billion valuation has now been escalated to the court room. This disagreement centers on the method that Zenefits™ used to gain access to ADP®’s payroll system without specific authority granted by ADP® to do so.

ADP® says: “On June 4, we disabled Zenefits access to ADP’s RUN small business solution due to unusual and alarming demand for data from Zenefits far out of proportion to the number of clients who have allowed them access to our system.”[1]

Zenefits™ has made a very public display of itself on social media outlets accusing ADP® of acting in bad faith and succumbing to fear, uncertainty, and doubt. In this squabble with ADP®, Zenefits™ has garnered some high profile endorsements including a couple of A-list celebrities.

So, you might ask how Zenefits™ got itself in this sticky situation.

1)      Their promise of delivering disruptive technology is somewhat misleading. The definition of disruptive technology is one that displaces older technology.[2] But Zenefits™ doesn’t own a payroll platform as a part of its hub-and-spoke business model[3]; its strategy is to leave customers with their existing payroll company such as ADP®.[4] But payroll is arguably the core hub technology covered by its service designed to administer HR, payroll, and employee benefit plans. Can Zenefits truly claim to be a disruptive technology without control of the core technology underlying its service? Is piggybacking on top of third-party payroll providers without control of the core technology too risky to be viable as a long term strategy?

2)      Zenefits™ is wanting to eat ADP®’s lunch and dinner by keeping the higher margin brokerage commissions and leaving ADP® with the lower margin payroll revenue. There is way more revenue per employee and margin in selling health insurance than in payroll.It’s no secret that payroll companies are looking to brokerage services as an area for future opportunity. ADP®’s (and Paychex®’s for that matter) benefits brokerage constitutes almost all of its current growth. Consider the fact that a 4% brokerage commission for a typical employer sponsored health insurance premium of $8k and $24K a year represents $320 to $960 in annual revenue per employee while fee revenue for payroll is just $90 per employee per year. And selling insurance has only a handful of customer service administration events per year while payroll has weekly (or even daily) customer service events per year to manage.

3)      When you dance with the gorilla, it is the gorilla who decides when you stop. Zenefits™ needs ADP® to play nice since ADP®’s payroll is the core technology to its hub and spoke service model. And ADP® knows it and is prepared to play hardball. The ADP® website states: “We have never integrated with Zenefits™ in any sense and have never authorized their method of extracting data from our RUN payroll system. They gained access to our systems by convincing clients to give them administrative access to our platform. Despite having many legitimate ways to integrate with ADP properly, Zenefits™ chose an unsecure and indirect approach.”[5] ADP®’s statement is likely vetted by their legal team and therefore sound and given ADP®’s size as the entrenched incumbent that does not bode well for Zenefits™ getting their way anytime soon.

Our industry—the HR, Payroll and Benefit Administration space—is extremely competitive and technology-driven with complex compliance requirements. It takes a lot of hard work, intelligence, deep understanding of the law and customer service to make it in this business. And it takes lots of effort to convert clients from one Payroll company to another. I know why Zenefits™ would want to leave the hard-part—the Payroll part to someone else, but I also know that there are no shortcuts in life. To become a disruptive technology leader in our space, I believe that you need to own all of your core technology so you control your users’ experience without the risk of someone or something pulling the rug out from under you and your customers.

So, this move by ADP® is not surprising at all. ADP® is simply a business that is protective of its customers’ assets and its future growth opportunity within its client base.

[1] ADP.com. The facts about ADP & Zenefits: Response to the claims made by Zenefits. http://www.adp.com/zenefits/downloads/The-Facts-About-ADP-and-Zenefits.pdf

[2] Zenefits has stated that it is a disruptive technology company. Zenefits | Disrupt NY 2013 Startup Battlefield. https://www.youtube.com/watch?v=KporpXG0XK8

[3] Inc.com. “Instead of charging for software, the idea was to do a hub-and-spoke model. http://www.inc.com/magazine/201503/liz-welch/hr-technology-with-benefits.html

[4] In an article written in the March Employee Benefit Advisor, Parker Conrad, CEO of Zenefits, openly stated Zenefits does not want to get into the payroll game. He says: “The reason is that payroll is really complex and there are really high switching costs. We’d much rather just be connected to everyone in that space and be friends with everyone in that space.”

[5] ADP.com. The facts about ADP & Zenefits: Response to the claims made by Zenefits. http://www.adp.com/zenefits/downloads/The-Facts-About-ADP-and-Zenefits.pdf

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