HR Function Benchmarking and Assessment Do you need an in-depth, 360 assessment of the efficiency and effectiveness of your HR operations at the corporate and local levels? Do you need to identify quick wins for cost savings or improved HR service delivery? What Our Participants Say It is a great benchmarking platform it helped reduce the usual burden of collecting benchmark data and they did an excellent job in supporting the data collection and analysis process around the world. The closing session with all companies that participated in the survey added a lot of value in understanding the benchmark results and next steps. CHALLENGES Approximately every other HR Function is currently planning, running, or evaluating a transformation, efficiency improvement, reorganisation, or cost-cutting initiative. However, less than 20% have succeeded in meeting their cost-saving and/or other performance objectives. Percentage of HR Functions Achieving Cost Saving Targets from Transformation Percentage of HR Functions Achieving Revenue Improvement Targets from Transformation 16% 19% Nico Orie Integration and Change Lead, Simplify HR Philips Professional and well-planned benchmarking project with always available and competent advisors...informative and open best practice exchanges between participants. Annette Eckhardt HR Manager Metro Cash and Carry ABOUT CLC S HR FUNCTION BENCHMARKING AND ASSESSMENT CLC s HR Function Benchmarking and Assessment provides an in-depth analysis of the efficiency and effectiveness of your HR structure, processes, and regional/local operating units. Through an assessment of 13 HR process categories, the benchmarking supports companies with responding to cost and productivity pressures as well as establishing a transparent and mature HR function. In addition, it delivers reliable data to pinpoint exactly how to better meet expectations for both HR service quality and efficiency. Partial List of Participants 1
PRACTICAL INSIGHTS Apples to Apples Comparison: Compare against like HR functions across consistently defined metrics. Root Cause Analysis: Pinpoint the drivers of inefficiency at your global and/or local HR operations, which allows you to target improvement opportunities by HR activity/sub-activity. Gap Analysis to Base Investments: Obtain an understanding of the current and aspirational state to guide investments across HR operating units. Maturity Assessment: Assess the maturity of your HR processes and structure, and identify opportunities to evolve your function. Guidance on HR Structure: Assess the effectiveness of your current global/local structure in supporting transactional and talent management processes. Cost Reduction: Eliminate overall HR costs by identifying duplicative processes, local inefficiencies, and opportunities for centralisation. Internal Best Practice Sharing: Uncover best practice approaches from local HR operating units that can be applied globally. Standardisation of Processes: Identify gaps in the consistency and quality of how transactional and talent management processes are being executed locally. Practical Insights from Your Peers: Participate in CLC s community sessions to benchmark results and exchange improvement strategies with your peers. FEATURES Online platform to enter and view data Advisor-supported data collection and quality assurance Benchmarking reports in aggregate and by individual entities On-site to review results and recommendations Community workshops to exchange ideas and best practices 2
WHAT DO WE MEASURE? We conduct a 360 assessment of your HR function, covering 13 process categories and nearly 400 metrics. Measurement Model 1. Entities Assessed Corporate HR Function Local HR Units Shared Service Centre Outsourced 2. Criteria Assessed HR Profile (i.e., global versus local responsibility for processes) Effectiveness (e.g., as a Strategic Partner, Change Champion, Employee Champion, and Administrative Expert ) Complexity (e.g., by company structure and workforce structure) Efficiency (e.g., by cost, FTE allocation, and productivity) 3. Processes Categories Assessed HR Steering Develop and Communicate HR Strategy Plan and Analyse Workforce/HR Function Manage Labour Relations Support Company Reorganisation HR Management Attract and Select Retain and Develop Reward HR Services Administer Employees Manager HR IT Manage Mobility 4. Example Efficiency Metrics Cost HR Function Cost per Employee Cost to Administer Master Data per Employee Cost per Pay Slip Cost per Hire Cost to Administer Training per Employee FTE Allocation Share of FTE in HR Steering Share of FTE in HR Management Share of FTE in HR Services Productivity Number of HR FTEs per 1,000 Employees Number of HR FTEs for HR Steering Number of HR FTEs for HR Services Number of HR FTEs for Administering Personnel Data SLICING AND DICING OPTIONS Geography (Global, Region, Sub-Region, Economic Region, and Country) Across Internal HR Units Outsourced/Non-Outsourced Complexity, Effectiveness of HR, Maturity of HR Other Factors Based on Your Requirements 3
DEEP DIVE METRICS Diving into sub-level metrics ensures greater accuracy when reporting toplevel KPIs (as it is calculated bottoms-up ) and provides clarity on the root causes of inefficiencies. Example of Metric Hierarchy Number of HR FTEs 16.3 15.8 16.7 16.3 11.7 You Italy Southern Global Number of HR FTEs in HR Steering Number of HR FTEs in HR Management Number of HR FTEs in HR Services Number of HR FTEs for Administering Personnel Data 2.8 2.5 2.5 2.6 1.9 You Italy Southern Global 4
HOW DOES IT WORK? Step 1: Scoping and Setup We help you select the countries and processes to be benchmarked across your HR function. We work with you to define roles and responsibilities for the benchmarking project. We setup the online benchmarking tool with the appropriate questionnaires and authorisations. Step 2: Data Collection We train your project team on the online tool, benchmarking methodology, HR process model, and all relevant data definitions. We provide hand-holding support by phone to help your team with data collection. Step 3: Quality Assurance We quality check incoming data using a standardised process and work with you on any necessary adjustments. Step 4: Workshop on Results We analyse and present your benchmarking results and recommendations. Step 5: Community Meeting Together with other participating organisations, you can take part in our community workshops to benchmark data and share best practice approaches for managing HR structures and operations. ONLINE BENCHMARKING TOOL Online data collection and viewing of benchmarks 5
FREQUENTLY ASKED QUESTIONS 1. How do you ensure an apples-to-apples comparison? To ensure greater accuracy, we measure activities at the sub-process level. This clearly defines what gets rolled-up into the higher-order KPIs. In addition, our advisor-supported collection process ensures data is not left to interpretation. 2. We already did a benchmarking exercise and would like to have an additional comparison of our data. No problem, we have created a tool to match taxonomies so your data can be easily inputted into our database. 3. How long does the data collection take? This depends on the availability of data in your company; however, on average, it is two working days for each benchmarked entity. 4. When can I participate? Anytime. 5. When can I expect the results? The timeline is tailored to your needs. Normally, the entire exercise (scoping, data collection, quality assurance, analysis, and reporting) takes three months. 6. How is my data used? Your data will be aggregated into each benchmarking category. Only companies that participate in the benchmarking will be able to view the aggregated results. Company names are not disclosed and your specific data is never presented. 7. What if my organisation doesn t have data for every metric in the survey? We fully understand that not all metrics will be available. However, we encourage you to be as thorough as possible, as the benchmarking is significantly more valuable when you have a robust data set. 6
ADVISORY SUPPORT We can provide additional hand-holding for organisations: Undertaking benchmarking for the first time and/or don t know where to begin with collecting data, Operating in a politically sensitive environment where data may get push back from stakeholders (e.g., finance, workers councils, regulators), or Looking to get feedback from stakeholders on current and future state of HR. Benefits Improved buy-in of all stakeholders in benchmarking results Involvement of stakeholders in setting priorities and creating a target HR operating model Onsite Support and Training for Data Collection In-person advisor to support data collection process On-site with your project team to define project set-up and targets Training session for your project team to develop an understanding of data definitions Focus Groups and Workshops Focus group with stakeholders to get feedback on HR operations, structure, and processes Workshop to develop a to-be HR operating model and accompanying road map CONTACT US CLC HR Benchmarking Victoria House 37-63 Southampton Row London, WC1B 4DR United Kingdom Tel: +44-(0)20-7632-6517 Fax: +44-(0)20-7632-6001 E-Mail: chiongr@executiveboard.com Kurze Mühren 13 20095 Hamburg Germany Tel: +49-(0)40-300-660-0 Fax: +49-(0)40-300-660-11 E-Mail: sgross@executiveboard.com 7