HROTodayGlobal

Sourcing HR Products and Services HR products and services are a collection of related, structured activities that serve a particular goal for a particular customer or customers. The structure within the area can be considered as policy. Based on the interviews, it became clear that for some products and services it is valuable to be organised globally, but not for others. Moreover, it became apparent that leaving everything to local organisation creates pressure to standardise and vice versa. Hence, a sweet spot is likely to be a utopia. An observed market trend is the globalisation of high-value HR, e.g., talent management and compensation: • All of the interviewed companies execute their HR strategy and strategic workforce planning on a global level, or are planning to grow towards this level. Hence, HR direction is determined on the global level for the entire company. The multi-domestic model seems outdated. • Many firms have recognised that human capital is one of the most valued corporate resources. Consequently, talent management is of strategic value for many firms and is therefore organised globally to ensure best practices and alignment with corporate strategy. • Compensation is considered a process that is highly suitable for global alignment. On the one hand, the data concerned with this process is highly interesting for the BoM. On the other hand, salary and STI are instruments that can be used to execute the HR people strategy and "steer" employees, e.g by a global bonus scheme. Products and services often organised locally or regionally are benefits, payroll, and personal administration. Main characteristics of these areas are that they have little strategic value and are locally influenced. An interesting methodology to determine the global–local balance per product and service was introduced by the fast moving consumer goods (FMCG) company. They developed a Level of process commonality Relocation GLOBAL REGIONAL/ LOB Payroll Skills Training Health & Safety Recruitment Learning & development Reporting & Analytics Performance Management Rewards & Recognition Talent Assessment Succession Management Competancy Management Critical Roles Management Workforce Planning On boarding LOCAL Feedback & Coaching Staff Planning LOW Labor Relations Master Data Management Directors level Policy: Global Application; Global Execution; Local Products and services within the top right quadrant are regarded as most important to influence centrally. Subsequently, for each process in the matrix, four key areas need to be defined (see Figure 4): process, data standards and KPIs (key performance indicators), policies and procedures, and solution (IT, shared service, and outsourcing). Accompanying principles are: the size of the global template will vary per process and may evolve over time, the template may only apply to a specific group (e.g., above a certain pay level), and the boundaries and contents of each area should be defined and documented. 1. Process 2. Data Standards & KPIs Global Template 3. Policies & Procedures 4. Solution - IT, shared service, otsourcing Localization Figure 4: Global Process Template An example of the global–local balance was provided by the asset management and maintenance company (see Figure 5). Within the functional area of talent identification, they organise and execute the process on different levels for different groups. For example, for SVP and director level M&ED: Talent Identification Global/Local SVP level Policy: Global Application; Global Execution; Global MEDIUM Figure 3: Which Processes To Centralise HIGH Strategic need to control model (see Figure 3) to plot the functional areas based on the level of process commonality and the strategic need to control. Based on this model, the level of global process execution was determined and the degree of importance to arrange this. Starter level Figure 5: Example of Global - Local Balance policy, application, and execution are global. Below director level, the policy and application are global, however execution remains local. FALL 2011 | www.hroglobal.com [17]

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