HR’s New Competencies Matthew Kaiser, CEBS Managing Director Lockton Benefit Group Kansas City, Missouri 4C-1
HR’s New Competencies
Matthew Kaiser, CEBSManaging DirectorLockton Benefit GroupKansas City, Missouri
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This is not me . . .
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Today’s HR looks vastly different from the HR of 25 years ago
HR’s certifications have grown in number
PHR SHRM-CP
(Not ignoring our little favorite in benefits: CEBS!)
HR’s vocabulary has changed
HRIS is now HCM and everything is “strategic”
HR’s drinking has also increased (depending upon your vice!)
PPACA “@#$%&”
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Today’s HR looks vastly different from the HR of even 10 years ago
Finally, while HR’s mission hasn’t changed: Attract, retain, and
motivate the best workforce possible
The COMPETENCIESrequired have certainly expanded
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Change Management
AGENDA4 New HR Competencies
ComplianceManagement
ContractNegotiation
Vendor Management
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AGENDA4 New HR Competenciesand maybe a few extra!
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AGENDA4 New HR Competenciesand maybe a few extra!
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Change Management
AGENDA4 New HR Competencies
ComplianceManagement
ContractNegotiation
Vendor Management
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Under-appreciated, under-resourced competency every employer needs
If present at all, often an IT function—especially if there is a PMO
HR needs to become synonymous with change management to ensure a seat at any strategic table!
CHANGE MANAGEMENT
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Always Involves Conflict!CHANGE MANAGEMENT
In Order to Be Successful
Our Objective:
Grow theBusiness
We Must:
Protect theBusiness
Go SlowerGo Faster
Source: Embracing and Creating Value from Shadow IT, May 2014 Gartner, Simon Mingay
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Acquiring, Developing, Maintaining tools outside IT’s governance Decision Support for Benefits OE QlikView, InfoBuilders, Tableau Total Comp Statements
Business must drive IT……but how?
CHANGE MANAGEMENT
SHADOW IT
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CHANGE MANAGEMENT SHADOW IT
Source: Embracing and Creating Value from Shadow IT, May 2014 Gartner, Simon Mingay
Mission-Critical Tools
Non-Mission-Critical Tools
Highly Complex
Tools
SimpleTools
PartnerUp
Off-Limits
SweetSpot
MoneyPit
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Stakeholder & Organizational Impact
CHANGE MANAGEMENT
StartWithWhy
WIIFM
Who Moved
My Cheese
Champion Change Mgmt Internally Story time!
Acknowledge any Cultural Change
Design the Process First
Rely on Outside Experience
Eagerly Seek Opportunities to Reinforce
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CHANGE MANAGEMENT—Why is it so diff icult?
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CHANGE MANAGEMENT – Why is it so diff icult?
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Instead of “informing,” HR must now
become excellent at storytelling—
Gaining attention, sustaining interest,
and provoking action
BE A GOOD STORY-TELLER!
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CHANGE MANAGEMENT vs. PROJECT MANAGEMENT
Project Manager Driver Control (esp. budget) Constrain—Scope creep watchdog Risk Avoidance Make the Change
Change Manager Mediator People and Impact Focused Open, Engaging Risk Mitigation Obtain Acceptance of Change
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PROJECT MANAGEMENT
Top 3 Reasons Projects Fail
1) Lack of user involvement
2) Lack of executive support
3) Inexperienced project managers
16%
53%
31%
Success or failure? Can you guess?
Source: Standish Group; US Project Leadership Conference—7,552 development engagements
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Change Management
AGENDA4 New HR Competencies
ComplianceManagement
ContractNegotiation
Vendor Management
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VENDOR MGMT should look INTENTIONAL
Metric Driven Corporate Objectives Cycle Time/Quality Risk Management Customer Satisfaction/NPS
Event Driven
VENDOR MANAGEMENT
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VENDOR MANAGEMENT
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VENDOR MANAGEMENT
Sourcing Strategy
Vendor Selection
Contract Negotiation
Implementation Oversight
Vendor Management
Vendor Management Risk Mitigations Continued Vendor
Product Development
Ongoing Financial Business Concern
Merger and Acquisition
Missed Credits for SLAs
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VENDOR MANAGEMENT
Transformation of HR Information Systems Bimodal is coming to HR
SaaS CAGR = 17.9%vs. employer IT budget growth of 3%
Switching Costs / Ease of Entry
Source: Evaluating and Negotiating Software License Agreements..2016, Gartner, Stewart Buchanan
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RECOMMENDATIONS
Create a holistic program for proactively monitoring: Vendor strategy/roadmap as it relates to your interests Performance to contract Objective Data:
YTD Expense and YOY increase, Vendor Ticker, D&B Rating
Obtain participation from key stakeholders vendor review process. Who feels the pain of the SLAs in the contract?
Implement a planned periodic review schedule Are they doing what they said they would? Speed of redress?
Source: Toolkit: Vendor Evaluation survey for 360 Degree Deal Review, Dec. 2015, Gartner, Helen Huntley
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Source: Magic Quadrant for Cloud HCM Suites 2016 Gartner, Ron Hanscome
VENDOR MANAGEMENT
Vendor Management Risk Mitigations Secure “Outside” Perspective Sources
Yearly “Sales” Evaluation
Topical Vendor Summit Corporate and Departmental
Objectives Expected growth rates Connection to Leadership
SLA/Net Promoter Review
Completeness of Vision
Abi
lity
to E
xecu
te
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HOW CAN WE MEASURE SUBJECTIVE DATA?
Net Promoter Score How likely is it that you would recommend Vendor X to a friend or colleague?
0 1 2 3 4 5 6 7 8 9 10Detractors Passive Promoters
VENDOR MANAGEMENT
. . . recommend Vendor X . . .
. . . recommend your Benefits Enrollment experience . . .
. . . recommend our Total Comp Statements . . .
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HOW CAN WE MEASURE SUBJECTIVE DATA?
360◦ Surveys Vendor Facing Questions
VENDOR MANAGEMENT
We are responsive to vendor issuesWe pay our bills timelyWe have clarity on business objectives , solution requirements and overall value needed
Source: Toolkit: Vendor Evaluation survey for 360 Degree Deal Review, Dec. 2015, Gartner, Helen Huntley
Internal Questions
Vendor contract is win/win for both partiesVendor responses to "requests for" are timely and completeProducts live up to vendor hypeVendor has inappropriate staffing numbers, or delays or turnovers that impact service delivery
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VENDOR MANAGEMENT
Opportunity or Risk? Yes!
Co-Sourced Development Ongoing Business Risk Private Equity Chase Data Security
EVALUATING START-UP VENDORS
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VENDOR MANAGEMENT
Begin with the End in Mind Renewal caps at signing
Target 3-5% net price increase for any renewal
Budget owner signoff
Multiyear deals = one price increase, not yearly
Pre-establish escalation strategy
Calendar negotiations T - 6 months
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Change Management
AGENDA4 New HR Competencies
ComplianceManagement
ContractNegotiation
Vendor Management
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GOTCHAS!
Rights to Innovation
Entire Agreement Clause
Limit of Liability
CONTRACT NEGOTIATION
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CONTRACT NEGOTIATION
ENTIRE AGREEMENT CLAUSE“This Agreement constitutes the entire arrangements between the Parties concerning the subject matter contained herein, and it supersedes and replaces any prior verbal or written understandings, proposals, quotations, communications and representations previously discussed by the Parties.”
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LIMITATIONS OF LIABILITY
The 3rd most important section
SaaS Standard:
Up to 1 year of fees paid
$7 PEPM + $50,000 impl. fee =
Max: $134,000 / 1,000 person firm
CONTRACT NEGOTIATION
average breach cost(up 29% since 2013)$4IBM/Ponemon Institute
MILLION
per recordPonemon 2013
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TRIPLE CONSTRAINTS
CONTRACT NEGOTIATION
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TRIPLE CONSTRAINTS
CONTRACT NEGOTIATION
Least Flexible
OptimizeMost
FlexibleWhy?
Scope/Quality
XScope can be outcome of
resources available
Schedule/ Speed
XAny quarter except Q4 start is
OK to begin
Resources/ Cost
XLimited experienced staff to
assign to this project
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DETERMINING YOUR LEVERAGE
1) 1-2 gap
2) Sales Quotas & Calendars
3) Innovation = limited competition
4) Name on Trapper Keeper
SERVICE LEVEL AGREEMENTS
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Hype CycleGartner Resource—
check with your IT
shop
Source: Hype Cycle for Human Capital Management Software, 2016; Gartner, Helen Poitevin
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SERVICE LEVEL AGREEMENTS
SaaS vendors love System Availability—99.5%/monthly Exclusions, 3rd Party failures don’t count (what about subs?)
SLAS FOR HR & BENEFITS BUYERS TO TARGET: Documented Disaster Recover Plan Minimum 72 hours notice of scheduled downtime Requirement to test data extraction at install and ongoing Attach to contract—Do not link to web
Tiered Credit Structure for service or support incident based upon severity Escalating credits—Fight the power!
Hardest to achieve: SLA reporting process with proactive alerting Finally, establish corporate escalation path in contract by role or title
Source: Toolkit: Key Terms to Negotiate in SaaS SLAs to Reduce Risk, Feb 2016, Gartner, Jo Liversidge
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Begin with the End in Mind Renewal caps at signing
Target 3-5% net price increase for
any renewal
Budget owner signoff
Multiyear deals = one price increase,
not yearly
Pre-establish escalation strategy
Calendar negotiations T - 6 months
CONTRACT NEGOTIATION
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CORPORATE GOVERNANCE
This can look intimidating
Other people’s worry?
If HR = Shadow IT, then HR = Shadow
Compliance too
Source: Understanding the Components of Compliance, 2012, Gartner, John Wheeler
Compliance Management
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COMPLIANCE MANAGEMENT
Source: Understanding the Components of Compliance, 2012, Gartner, John Wheeler
HR & BENEFITS AS COMPLIANCE
Risk Aware vs. Zealot
BYOD Makes Compliance = Invasive
Contingent Workforce = Fluid Target
People = HR
Associate Development Opportunity
IT Partnership Opportunity
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COMPARING COMPLIANCE RISKS
Which is worse:
- Hacker getting inside?
- Missing Regulatory Req.?
Cost x Risk x Impact
Compliance Leveler
Internal Cost
External Risk
COMPLIANCE MANAGEMENT
0 0.5 1 1.5 2 2.5 3 3.5 4
Risk to Business
HighCost
LowCost
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Change Management
AGENDA4 New HR Competencies
ComplianceManagement
ContractNegotiation
Vendor Management
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THANK YOU!
What questions do you have?
@MatthewKaiser_
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