On the factor of HR Consultants

Another important factor which we have observed is the reluctance of Indian organizations to engage HR consultants during the implementations. By usage of the term Consultants, we mean real consulting experience of HR processes, Best Practices, Change Management - & not IT consultants who just do the system implementation.
An interesting study conducted by Accenture pointed out that " Indian firms were unaware of many modern management practices or did not have the know how to implement them".
Also the study showed that companies that availed these consulting practices showed a dramatic improvement in efficiency and profits.
While this study was primarily in the textile manufacturing sector, there is sufficient understanding that a broad based nature of these problems could exist in other industries as well.
In a similar vien, we have seen most of the organizations struggle with their HR technology implementations. Even after implementation, most organizations only use it as a tactical and operational tool failing to fully leverage strategic benefits of the technology.

Why is it that organizations do not want to employ consultants? I premise a few

• Consultants are generally too expensive
• Openness to consulting kind of a model - we know it the best attitude
• Consultants generally recommend too much without actually having a grounding in the problems, what I would call Recommend and Run.

While some of these criticisms are true for the consulting industry, one cannot really use the same brush to tar all consultants. Consultants can bring in their professional grounding in different industries, different verticals and advise clients. Also it is a myth that many consultants are expensive. Organizations can discuss & debate various pricing models with consultants to derive the maximum value from their advice.
It may make sense for organizations to involve consultants in a limited way in niche areas during the course of their HR implementations. The reasons for involving HR consultants could be the following:

• Lack of awareness of HR technology & its application to their HR issues - Organizations are generally good at formulating HR policies but do not know how to implement the same using HR technology.  
• Even before the launch of RFP for the technology to be implemented, there is a lot of due diligence to be done, organizations are generally unaware of how to go about doing the same  
• Organizations are not aware of how to formulate requirements for implementing a technology solution for their HR challenges 
• Lack of clarity on Best Practices: Even though implementation partners claim to bring best practices in the implementation, more often these are a rehash of their last implementation without any thought to the critical parameters such as industry sector, nature and size of the organization, geographical span etc. This generally results in implementation of processes which do not have a fit with organization’s requirements. This has to be done at the time of requirement definition itself in the pre-implementation stage. 
• During vendor evaluation, due to information asymmetry as vendors typically try to sell the “hot stuff” available and do not take completely into account the organization’ need, organizations may not be in a position to make right choices , hence wrong vendor and technology selection may happen.  
• Lack of preparation by the HR team: Once an implementation partner is chosen, the organizations go along with what the partner brings to the table, more often losing focus on critical areas such Job Profiling, Competency Mapping, Talent Management linkages, integration points and data extraction, cleansing and reconciliation approaches. This generally results in half baked work done by the implementation partner who is not well versed with these specific organizational processes.  
• Lack of monitoring and health checks: Most of the implementations do have a monitoring mechanism in the form of steering committees but these committees generally operate at a very high level mostly handling coordination and conflict resolution. There is no hands-on independent health check of the implementation at critical milestones leading to cascading of critical issues towards the end of implementation lifecycle. This generally results in chaos during the User Acceptance and Go Live stages of the project. Going live is a tumultuous experience for most of the organizations due to lack of advanced assessment of all aspects of production readiness.  
• Lack of understanding on the right reporting: The reports delivered with the HR standard products are very generic in nature and do not cater to specific reporting requirements for specific roles in the organization. Selection of right KPIs relevant for the industry is generally given a miss by the implementation partner. Clearly spelling out the reporting requirement is critical for right management reporting and right level of decision making support at levels of management. This is also one most of the most important measures of the success of technology implementation 
• Change management is another area where organizations usually are under-prepared. Moreover, incumbent vendor may not have necessary skill sets to advise clients for the same. In most cases, organizations start on this critical process too late in their project life-cycle considering it as an end of lifecycle activity. As a result, after implementation, organizations may not realize the necessary benefits of the new technology due to lack of user adoption.
• Value Assessment: During post implementation stabilization phase, organizations fail to measure the return on their investment and effectiveness of technology implementation. This result in organizations losing interest in the implementation as a source of competitive advantage and use it only as a tactical tool for administering the workforce.

Elusive hunt for the right solution

Shopping for a new HR solution is relatively an enjoyable experience for the HR and IT team members who later become part of implementation team. This is because the journey afterwards is generally uphill. The evaluations process is marked by all day meetings with internal process owners to agree on the current or as-is processes, spending weekends formulating and documenting the requirements and the presentations running into late evenings by vendors claiming to have the best fit solution for their requirements . There are deep dives and reference visits along with the sumptuous working lunches and dinners delivered from the nearest pizza outlet. There is generally a sense of satisfaction in the team going into the final phase of commercial negotiation. Once the negotiations are over and the procurement team gets the ‘best-price’ from the winning vendor, the newly formed project team is all set and raring to go. The organizational air is quiet thick with expectations.

Yet within weeks of the of the project launch, the team finds itself in the midst of an impending storm. The solution does not seem to fit the requirements and there are huge disagreements on the To-be process definitions. The process owners are not ready for any changes or work arounds and want to stick to the current processes. The implementation partner is not able to fully explain the cost and benefits of the proposed processes vis-à-vis the current processes. The differences are generally resolved through agreeing to large amount of customizations which in turn results into change requests for additional services from the implementation vendor. The financial implications of these additional change requests take the matter to steering committees where there arguments and more arguments. Finally there is a compromise reached on the services fees charged by the implementer. However, there is hardly a discussion on possible re-engineering of the process or the best practices due to lack of right resources and capabilities on both sides of the table.

The impact of this initial chaos is multi-fold. First and foremost is the high risk of time and cost overruns impacting project lifecycle in fundamental way driving the cost of ownership up and delaying the realization of expected benefits. Second, it dents the organizational confidence in the implementation team and introduces friction between the customer and implementation partner teams having long term impact on the team morale. Last and most important, process improvements expected from the implementation are never achieved as the project ends up automating the current process inefficiencies and does not seriously evaluates the re-engineering and best practices.

There are primarily three reasons why the search for the right solution turns out to be so elusive. The vendor evaluation team hardly ever includes an HR technology expert who could understand the process requirements and translate it into a system requirement, thereby ensuring the right requirement formulation. This flows from the fact that members from the HR team only have process understanding whereas members from IT only have systems understanding and there is no independent voice bridging the two. Typically this results in the relevant questions not being asked by the evaluation team and general discussion hovering around whether the system can take care of the current processes.

Second issue originates from the lack of mandate for process standardization/improvement as part of the technology implementation. Process owners are extremely protective of their processes from any scrutiny and any attempt for re-engineering becomes an extremely political issue. The absence of executive endorsement and an independent voice recommending the process changes at the system level ensures that best solution is never ever comes up for discussion.

Insufficient resource commitment from the implementation partner is another important reason the failure to implement the right solution. The functional consultants working on the implementation are generally product gurus but have do not have in depth grounding in HR processes. As a result, they seriously lack the ability to present alternative solutions explaining the costs and benefits of each of the alternatives. The lack of real alternatives forces the process owners to stick to the current processes which are low risk from both automation as well as user adoption perspectives.

Looking at all these factors, the need for an independent voice that understands both HR process and technology is imperative to work as a bridge between customer and implementation partner teams. This group can work as independent consultant in helping the customer team evaluate different solutions, work closely with process owners in standardizing and improving current processes and work with the implementation partners in defining and vetting the alternative solutions. Without such a mechanism in place, an HR implementation that gives a strategic edge to the HR practices and processes in the organization will remain an elusive dream.