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Selection of a Human Resources Selection of a Human Resources Information SystemInformation System
Employee Relations InstituteJanuary 24, 2002
Nona Tobin and Ron Komers
““An ERP installation is likely to be An ERP installation is likely to be the toughest installation your the toughest installation your company will ever undertake. company will ever undertake.
Whether you make it through this Whether you make it through this painful transition is dependent painful transition is dependent
upon how intelligently you upon how intelligently you approach the project.”approach the project.”
-Integrated Solutions, March 2000 by Doug Campbell
Framework for the DecisionFramework for the Decision
What is the context for making a major system commitment?
What do the top decision makers think is important for IT investments?
What is the organization culturally, politically and financially willing to commit to the implementation?
Levels of implementationLevels of implementationERP: incremental or “big bang”Web-enabled self-serviceHRIS Home-grown systemDifferent vendors for HRIS subsetsLegacy systems and band aids
““Enterprise resource planning Enterprise resource planning software, or ERP, doesn’t live up software, or ERP, doesn’t live up
to its acronym. Forget about to its acronym. Forget about planning-it doesn’t do that-and planning-it doesn’t do that-and
forget about resource, a forget about resource, a throwaway term. But remember throwaway term. But remember
the enterprise part. This is ERP’s the enterprise part. This is ERP’s true ambition.”true ambition.”
-The ABCs of ERP, Enterprise Resource Planning Research Center
Criteria for System Choice: Criteria for System Choice: Organizational CommitmentOrganizational Commitment
What is the impact of doing nothing?
What is economically feasible?Who are the system’s
champions?How much change will the
organization embrace? Or tolerate?
Common Causes of ERP FailuresCommon Causes of ERP Failures Nonconformance to
“Best Practices” Insufficient executive
sponsorship Inadequate preparation Heavy modification of
software Y2K was primary
implementation driver
Management did not ask “how do we want to do business?”
Led by inexperienced consultants
IT sidetracked by cool technology
Insufficient training Unrealistic deadlines
“Getting the Most out of ERP”-www.brightsolutions.com/erp
The larger the system, the greater top level commitment must be.
HR should not take the lead alone.The more HRIS connects with the
agency’s business outcomes, the more valuable the system will be perceived.
Culture Fit Analysis: Culture Fit Analysis: Determine the Stakeholders’ Determine the Stakeholders’
InterestsInterests
Culture Fit AnalysisCulture Fit Analysis
Align with organizational IT commitment and strategy.
What are some of the risks and realities associated with different options?
Involve unions early in choice between customization and “vanilla”.
Examples of Union ConcernsExamples of Union Concerns
Calculation changes, e.g, accruals
New style or automated pay advisory
Mandatory direct deposit
Dual employment
“Earn and burn” Hours vs. dates FLSA formula Security and
confidentiality Retroactive payments
Implementation Models: Risks Implementation Models: Risks and Realitiesand Realities
Best of breed vs. sole software provider All inclusive contract Separate vendors supply consulting vs.
software and other servicesContracts with payments due on
deliverables Time and materials contracts ASP: Automated Service Provider
Vendor DifferentiationVendor Differentiation
FunctionalityMarket shareFinancial viabilityCustomer service Support of business requirementsTechnology and architectureBusiness model: licenses/upgrades/fixes
Models: Risks and RealitiesModels: Risks and RealitiesGo nowhere without lawyers!Risk vs. Reward EquationMarket Place Risk:Will they be here tomorrow?WYSIWYG – Not!How many times can you ask for money?
GAO RFP Assessment AreasGAO RFP Assessment Areas Position Management Classification Recruitment Personnel Actions Benefits Administration Labor Relations Workforce Development
Time Processing Absences and Leaves Pay Processing Labor Cost and
Distribution Reports Reconciliation Records Retention System Requirements
Where can you go for help?Where can you go for help?
Model after other jurisdictions’ RFPsGFOA fee-based consulting Internal IT staffRFP for consultant to do system RFP
CostsCosts
Customization vs. going “ vanilla” Ongoing costs for development,
maintenance, and production Implementation consulting costs run 3-5
times the cost of the softwareOperational disruptions
Oasis Implementation Costs
A B C D E1
HRMS Implementation Costs FY 00-03
2
3 FY 99/00 FY 00/01
FY 01/02-02/03
Total Project Costs
4HARDWARE/SOFTWARE * 2,530,864 803,781 647,255 3,981,900
5ANDERSEN CONSULTING 2,381,666 6,773,859 0 9,155,526
6CONSULTANTS 240,138 1,151,095 0 1,391,234
7STAFFING 540,668 1,914,604 0 2,455,272
8TRAINING 14,653 152,200 0 166,853
9FACILITIES 87,748 81,567 0 169,315
10OPERATIONS 1,698,004 768,428 0 2,466,433
11Total HRMS Costs 7,493,742
11,645,535 647,255 19,786,532
12
13
*Lease/Purchase Equipment won't be paid off until FY03.
14
15
16
HRMS Ongoing Operation Costs FY 02-03
17 FY01/02 FY02/03
18HARDWARE/SOFTWARE 135,000 666,927
19STAFFING 1,162,181 1,791,863
20TRAINING 80,650 78,163
21IT SERVICES 942,525 816,003
22FACILITIES & SUPPLIES 977,285 525,976
23CONSULTANTS 900,000
24CONTINGENCY 900,000
25HRMS UPGRADE 1,110,000
26Total HRMS Costs 5,097,641 4,988,932
Riverside County
““Any kind of IT project on an Any kind of IT project on an enterprise scale can create headaches of enterprise scale can create headaches of equal size. The largest single mistake equal size. The largest single mistake most government agencies make when most government agencies make when
undertaking an ERP project is to undertaking an ERP project is to underestimate the amount of change s underestimate the amount of change s associated with enterprise systems.”associated with enterprise systems.”
-Randy Hendricks, Anderson Consulting, in Government Technology
Magazine
Implementation SurprisesImplementation Surprises
Implementation SurprisesImplementation Surprises
Vendors promise more than they can deliver. Dedicate “best and brightest” during the
implementation. Ongoing staffing with higher and different
skills must be added.Interface issues are significant.Some users will never embrace the system.
““Over 60 percent of Consultant Led Over 60 percent of Consultant Led Technology Projects including new Technology Projects including new
systems Development, Package systems Development, Package Installation (e.g., CRM, ERP, etc.) and Installation (e.g., CRM, ERP, etc.) and
those involving Business process those involving Business process Reengineering utterly fail. And, 80 Reengineering utterly fail. And, 80
percent of consultant led projects don’t percent of consultant led projects don’t achieve the results they proclaim at the achieve the results they proclaim at the
project’s onset.”project’s onset.”
“Technology Consultant Failure Analysis”-www.gpsconsult.com
Data: Access and UtilityData: Access and Utility
Data entrySecurityReports
Lessons learnedLessons learned Scope creep adds to cost Training requirements are hugeCommunications must be intensiveProblem examples
– “reports to” field can’t be kept updated– work flow – much less than promised– data entry increases in HR – FLSA special problems
Personnel issues:Personnel issues:
Who is in charge?Who is in charge? Who is the ultimate system owner?Who is the ultimate system owner?
Comprehensive HR Capital Comprehensive HR Capital Management Solution?Management Solution?
Nobody has it all!Nobody has it all!
Elements of an EndElements of an End--toto--End SolutionEnd Solution
Company specific pool development tools
Candidate aggregation
Candidate communications channelScreening processes
Recruiter’s desktop
Ad selection (media planning)
Ad distribution (cross posting, targeting)
Workforce management and analytics
Response integration and management
Applicant tracking
Specialty candidate sources
Workflow management
Vendor management
HR system interfaces
Conclusion:Conclusion:
“You better love the system you “You better love the system you buy because you’ll be married to buy because you’ll be married to
it for a long time!”it for a long time!”