E-Handbook: Evaluating SaaS HCM as a complete HR platform Article 4 of 4

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5 keys to ensuring your new SaaS HR system excels

Running HR in the public cloud brings data, integration and change management issues. Here are tips on overcoming the biggest hurdles of deploying a SaaS HR system.

Setting up HR systems in the public cloud is all the rage. Doing so enables companies to shed burdensome IT responsibilities, deliver round-the-clock access to data and applications, and achieve new levels of flexibility and agility.

But as growing numbers of organizations either migrate their legacy on-premises systems to a SaaS HR system or, in the case of younger entities, choose to build their HR systems there from the get-go, they're learning a lot of tough lessons that can help those coming in behind them.

Marc Farrugia, vice president of HR for Sun Communities, which operates nearly 360 retirement communities and RV resorts in the U.S. and Canada, said those followers would be well-advised to make use of that insight sooner rather than later.

"If you haven't started the process of moving to the cloud, you're behind the times," said Farrugia, who has consolidated the company's HR on SAP SuccessFactors and will wrap things up once Sun goes live on SuccessFactors' Employee Central Payroll application by the end of this year. "You need to start that process."

Of course, companies considering a SaaS HR system will want to know what steps they should be taking to increase the odds of successful deployment and adoption. And it just so happens there's pretty widespread agreement on the actions an organization can take to make that SaaS HR effort sing. After talking with users, analysts and vendors alike, we've packaged their feedback into five tips that will tip the scales, so to speak, in your favor.

1. Do as much advance planning as possible

As Farrugia pointed out, establishing a SaaS HR system has a lot of moving parts, from business processes that need refinement to a partner ecosystem to consider, and many ways to accomplish the same thing. That leads to a lot of room for making erroneous assumptions, which is why he strongly recommended getting your ducks lined up before you find yourself in the middle of the forest without a compass.

"Spend a lot of time on the front end," he said. "Make sure to scope and plan out your strategy very carefully."

Odds are your vendor will insist on that as well. Gretchen Alarcon, group vice president of HCM product strategy at Oracle, said she encourages her customers to spend time thinking about a couple of big picture questions: What are you trying to accomplish? And what areas really matter to you?

Brian Sommer, a longtime HR analyst and founder of consulting firm TechVentive, said combining that kind of self-exploration with a thorough review of the market's offerings is critical to getting a clear idea of what can be accomplished. And Sommer stressed that it's important to factor in not just how the system will appeal to HR staff and the general employee population, but also future prospects.

"Consumer-grade capabilities in HR are a requirement if you want to have any hope of hanging onto millennials," he said.

2. Avoid the dreaded lift and shift

HR vendors are vocal about this. They've seen too many companies try to recreate their on-premises environments in the cloud, effectively ignoring many of the potential benefits they could be reaping.

"If you're just replicating what you have, you're probably not going to get the full value," said Cristina Goldt, vice president of HCM products at Workday.

Frans Smolders, senior director of HCM solution management at SAP SuccessFactors, agreed, stressing that companies need to let go of old habits and embrace new doors the cloud can open for them.

"The discussion shouldn't be about having a button on your screen where you want it," Smolders said. "It should be around HR strategy and what solutions are needed to support that strategy."

Avoiding bringing stale thinking into the proceedings was a major priority for Kellie Romack, vice president of digital HR for Hilton Hotels, which is wrapping up a migration from PeopleSoft to Oracle HCM Cloud that will go live in September.

"One of the guiding principles when we went into this was: Just because it was doesn't mean it has to be," Romack said. "We still want to maintain our business objectives, but we also want to make sure we're not doing something just because that's how it was done before."

3. Get your data in order

The way IDC analyst Lisa Rowan sees it, getting HR data ready for the cloud may be the most significant activity in the migration to a SaaS HR system. Many companies find that they're transitioning from an archaic way of storing data into an unfamiliar environment that relies on object-relational databases. And while it's a daunting task, it also represents an enormous opportunity to simplify data models.

"You have to homogenize," Rowan said. "Cleaning up all of that old, bad data becomes part of the task."

Hilton's Romack wished she started that part of the company's migration effort sooner. It wasn't until the company was well into the process that her team started spotting numerous opportunities to consolidate, simplify and reduce data. For example, it became clear that the company had multiple codes for describing housekeepers or for distinguishing between servers in different restaurants, and corrections were harder to make later in the process.

That's why Romack recommended that others considering the move to the cloud turn over every rock.

"Look at those items that you take for granted, and find opportunities to consolidate," she said. "Even if you didn't do it in your previous system, you can think about it in your new system."

4. Put a lot of thought into integrations

To paraphrase Mel Brooks' famous crack about politics in the movie History of the World, Part I: "Integration, integration, integration, integration, integration!"

So often the bugaboo of SaaS HR system migrations, it seems that, no matter how many integrations an organization thinks it's been supporting with its on-premises HR system, there are probably more. And since a company is going to want to make good decisions about which integrations to keep and which to jettison, any misinformation can become a big problem down the line.

"Many companies may not even know how many downstream systems are relying on this data," Oracle's Alarcon said. "They may not realize how much will change."

Romack thought she had a handle on this. Hilton identified 80 integrations to its PeopleSoft system, and each had to be thought about differently in the cloud. While Romack's team was able to work through the related challenges, she now wishes she had been more proactive.

"If we had spent more time during the discovery identifying all of those integrations and deciding which ones were priorities, doing that upfront would have been a huge advantage," she said.

Farrugia also had an integration hiccup, when some confusion about how the integrations were being done during the migration of payroll data led to a drastic change in the scope of the effort, forcing a subsequent change in the timeline. And the whole thing could have been avoided had Farrugia fully grasped the capabilities of SuccessFactors Employee Central.

"That led to a lot of aggravation and additional expense," he said. "I should have had someone walk me through and really understand the sophistication of the platform."

5. Do not underestimate the role of change management

This is an area that so many organizations shortchange. IDC's Rowan said companies are always telling her they'd do a better job with communication if they could do a migration over again. The simple truth is: Human beings like stasis.

"We just don't like change. It may be horrific to do a specific task, but it's the way we're used to doing it," she said. "The importance of managing change and managing that communication process cannot be overstated."

This is one area Romack said Hilton made sure to get out in front of. The company started by hiring an executive with a change management background to oversee the process, and it then set up a change review board with a network of advisors. Hotel managers were brought in to ensure that what the company was doing would work for them. A digital training system was developed to walk employees through the new systems, step by step.

According to Romack, this sophisticated approach to change management will translate into a better customer experience, which, ultimately, is really what effective HR is about.

"We don't want team members to worry about being able to get at their vacation balances," she said. "That way they can focus on our guests."

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