Friday, August 25, 2017

Placing HCM Stewardship Where it Belongs: Outside of HR!

In retail, capturing data in real-time at the Point of Sale (POS) leads to better stock replenishment and more informed customer interactions and experiences. Now take that same concept into business operations with HR and employees, where transaction or event participants similarly have the biggest vested interest in achieving maximum data accuracy and transaction processing speed.

The principles of real-time data updates and logical transaction ownership led to a lot of new Employee and Manager Self Service functionality in the early days of HCM systems. Let’s also remember, though, that self-sufficiency -- as in not having to deal with the occasional black hole that some HR Departments are identified with -- is also directly correlated with stakeholder or customer satisfaction.

All of this “transactional mumbo jumbo” can be boiled down to one phrase: Human Capital Management stewardship … and also perhaps one question: Where should primary HCM ownership lie? The “HR as necessary interloper to keep the company out of trouble” model hasn’t really endeared itself to many outside of those running professional HR organizations. So why keep “workforce management activities to drive enterprise value,” aka HCM, strictly in the hands of the HR Department?  No reason. It’s a stupid waste of resources – both financial and human.

HR adds the most value, by far, when it enables line managers to be effective stewards of HCM

How do you as an HR professional accomplish this?

(1) by truly understanding the business of your internal line manager customers
(2) by being a trusted advisor when it comes to HCM-related opportunities and risks (both -- not just risks!)
(3) by syndicating best practices, tools, standards and innovations related to HCM across the organization … whether an HR-borne idea, an internal customer’s idea or something learned at a professional HR organization’s conference.

Business leaders don’t just have P&L responsibility. They interact with their teams every day, in all situations, and they ideally have the “HCM acumen” to know what will drive employee engagement, retention and productivity … or conversely, what will impede these outcomes and how to mitigate those impediments.

Bottom Line: HR Departments must place a huge emphasis on line manager enablement, thereby shifting HCM stewardship to where it belongs – to team leaders, department managers, and senior executives. HR Departments should enable, or get out of the way.

Another “SRO” Crowd for an AI Presentation, But at a Payroll Conference?

A standing room only crowd for an industry conference’s AI session, something seen with great regularity these days. But it's actually from an American Payroll Association event in Orlando. You read that correctly.

While the payroll function and services market likely weren’t among the first AI or RPA candidates written on white boards in innovation labs, this obvious level of interest might suggest a “can’t see the forest through the trees” dynamic operating in some of those innovation labs. Back-office corporate functions such as payroll are in fact fertile ground for RPA and intelligent automation overall, given the preponderance of recurring manual tasks and transactions not dependent on person-to-person interaction.

Innovation labs are now on the case.

The speaker for this session called “Prepare Your Teams for the Future of Payroll: Robotics, Automation & Shared Services” was Brian Radin, President of global payroll services provider CloudPay and long-time entrepreneur in the HR Tech space as well. Brian immediately got everyone’s attention by factually reporting that the number of bank teller jobs did not decrease in the years following the introduction of ATM machines. Teller numbers actually went up due to shifting staff costs to support new, higher value services within retail branches, which ultimately allowed more local branches to open up, tellers in tow.

Using AI in the realm of HR operations, including cognitive computing and RPA (Robotic Process Automation) or bots, has been explored in my blog posts. Radin’s session focused specifically on AI’s current and future use in payroll operations, including via services providers like CloudPay.

Some Easy Questions, Some Hard Ones

Radin’s talk directly addressed some key questions about “AI in Payroll”; e.g., how can (or will) these capabilities help payroll clients spend less time on manually intensive, routine or recurring tasks, ones that machines can often handle with more alacrity? And are there other tasks where resourcing can be toggled between human and bot staff depending on availability? Here the presenter highlighted examples like data validations and checks pre and post-payroll run (payroll has quite a few of those), machines fixing errors or automating the consolidation of data, and of course, chatbots to answer recurring questions like “what is my accrued PTO?” or “when will I receive my first check?” (Questions which come up hundreds of times per year.) Allowing RPA tools to handle these will benefit clients of providers like CloudPay and any other vendor investing in these capabilities. And as far as highlighting a “resourcing agnostic” (bot or person) type of activity in payroll, the example given was using people or bot staff to train new staff.

One of the highlights of the session for me was listening to questions attendees were posing at the podium afterward, away from the large audience. One gentleman told Radin that training and re-skilling of staff were already going on in his company in areas where RPA would be heavily leveraged, but it sometimes provided only a year or so of “job runway” for employees until RPA would impact their next job. Then re-skilling would have to start again. Radin’s response was both admirable and accurate: “Re-skilling decisions in the RPA era is very much a work in progress.”

Machines that Do, Do and Think, and Learn

CloudPay’s VP Marketing, David Barak, elaborated for me after the session on Radin’s slide which highlighted these three different categories of RPA capabilities: “Do” describes the use of RPA to move and manipulate payroll data without human involvement, as one example. “Do and think” capabilities include the machine flagging and fixing hundreds of data issues pre-payroll run; and while “Learn” is an RPA capability in payroll processing that’s still being tested and improved upon (as with machine learning in most areas), it includes anticipating spikes in payroll processing costs based on time of year, business cycles, new regulations, etc. This information can then guide the customer in optimizing staffing levels.

Bottom Line: Payroll departments and services provider clients will increasingly benefit from emerging RPA and cognitive capabilities. It will probably be a few steps forward and a couple backward until something akin to a “human/bot hybrid resourcing homeostasis” is figured out – in general, and also reflecting specific customer contexts. Predicting how far / how fast with any precision, in any industry or discipline, is almost a total crapshoot. One thing we do know, machines are not nearly as susceptible to errors due to work overload or distractions.

The Latest HR Power Tool … IoT!


Now available in select “HR supply stores”: IoT (Internet of Things). Much like the double-edged sword nature of its companion power tools, IoT in workforce management can usher in unprecedented and significant business benefits, but only when the right capabilities are selected and potential risks and adverse outcomes are accounted for. 
IoT is a process in which people, machines, and devices are connected to one another via a single network in order to automatically exchange data without any manual involvement. IoT can, for example:
  • track the productivity of workers in the field
  • confirm overall fitness or fatigue when relevant
  • assign tasks based on the nearest worker
  • tie scheduling real-time to customer flow
  • offer real-time training based on an employee’s time on job, credentials or performance
All of this sounds pretty compelling, but a couple words of caution. The first word: Volkswagen, whose engineers illegally programmed IoT-like software to sense when the car was being tested during an emissions inspection, which then activated more costly equipment that reduced emissions. This resulted in a roughly $3B fine this year. Additionally, IoT solutions will generate lots of new, often very valuable data related to people and how they perform their jobs, and not every HR Department is adequately staffed to handle the current explosion of people data or supported by data scientists.
Cause for Optimism with Early Adopters of IoT in HR
While not many HR Technology solution providers are occupying the IoT market category just yet, one company caught our attention: Triax Technologies, and specifically with their “spot- r” solution for companies with workers in the field, particularly on constructions sites. Certainly, accidents are more common there. My briefing from Triax’ COO Peter Schermerhorn enlightened me that U.S. construction companies pay out $1 billion annually for claims related to slips, trips or falls; that the construction industry pays more than twice the national average for workers’ compensation insurance; and that an estimated $7.2 billion in fraudulent workers’ compensation claims are filed annually in the U.S.

spot-r by Triax provides data-driven, real-time visibility into construction operations and safety incidents, leading to an improved safety culture on site and can result in reduced insurance costs. Automatic, geo-tagged “slip, trip, fall” alerts improve response time to accidents and record surrounding conditions (temperature, height, location of witnesses in the area, etc.), self-alert buttons empower construction workers to stop working due to unsafe conditions and alert supervisors to hazardous conditions, and high-decibel evacuation alerts are included in the mandatory wearable devices used on many of the company’s pilot projects with customers. Peter also offered a glimpse into the near future when the company’s sensors will be used in new ways to promote safety and visibility on the job site. Imagine knowing in real-time where your workers, equipment, machinery, and tools are onsite and how they’re interacting with each other.
Who said technology innovations related to HR and workforce management usually lag other business areas?

Bottom Line:  As with all the other power tools (i.e., sophisticated capabilities) recently added to the HR practitioner tool belt, IoT’s potential to be a game-changer cannot be overstated, but neither can the surrounding considerations for avoiding possible misuse or sub-optimal deployment.