Migrating to the Cloud?Here’s why HR should go first

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Q&A

Tom ConnollyCEO

GattiHRtconnolly@HattiHR.com

Speakers

Saurabh GuptaProduct LeadRamco HCM

Saurabh.Gupta@ramco.com

Bob McCarthyManaging Director, Workforce Analytics

GattiHRbmccarthy@GattiHR.com

Our View

Leadership teams have always had to make tough decisions about the what, when and how of staying competitive

Digital transformation is one of the most important competitive decisions leaders face, across a range of opportunities & challenges

Traditionally, HR’s role has been to “hurry up and wait” – support the needs of other areas and delay its own technology upgrades.

That’s exactly the wrong way to think.▪ HR is uniquely suited to the cloud.▪ The cloud has completely disrupted

HR software economics▪ The ROI HCM is significant▪ Change management strength

developed here translates well to other migration efforts.

▪ A distributed, but largely internal customer base.

▪ Change management strengths.

▪ Experienced with delivering on limited/smaller IT budgets.

Getting it right: Why HR is uniquely suited

Sequencing Trade-offs Scalability

All reasons for HR to go first, but there are also the “big three”

Getting the sequencing right

Sequencing the migration is a tricky decision

For every business platform, four very different migration possibilities

Complete re-write – high cost, high risk▪ Reserved for “bet the

farm”/core applications

Hybrid extend – keep the core in-house, build all new functionality in the cloud. ▪ Complex▪ Two talent pools▪ Integration, Data exchange and UX challenges

Lift and shift – the “simplest” of all, but rarely possible

Product replacement – Find a new product that works betterHR is typically moving from...▪ Platform-to-platform▪ Manual-to-platform

Trade-offs: Perceived and Real

Performance Myths & Realities▪ Reality: Data Dependencies▪ Reality: Incompatible application

architecture▪ Myth: Proximity/Latency

Security Myth & Realities▪ Reality: Transport & transfer protection ▪ Reality: Regulatory requirements▪ Reality: Employee data critically

important to protect, but customer data is where the largest exposures lie.

▪ Myth: “It’s safer in-house”.

It’s important to sort our “real” from “perceived”.

As with all new technologies, there is as much myth and urban legend as there is truth…

Understanding Scalability

“Vertical” characteristics (Customer Database)▪ Millions of records▪ Relatively few fields▪ Few Data Inter-connections

Vertical Scalability

This is what most in-house applications are built for, and what most IT professionals are trained

to understand when the say “big system.”

Vertical Scalability -- What most IT professionals are trained to understand when the say “big system.”

Understanding Scalability

“Horizontal” Characteristics (Employee Database)

▪ Thousands of records

▪ Hundreds of fields

▪ Many Data Inter-connections

Horizontal Scalability

This is not what most IT professionals are trained to understand when the say “big system.” A major reason why HCM implementations go so poorly.

Horizontal Scalability – This is not what most IT professionals are trained to understand when the say “big system.”

Why HCM Platforms are Uniquely Suited to Go First

Sequencing

HR migration is the best, most direct, least risky option

Trade-offs▪ Performance not an issue▪ Security can be improved

by moving to the cloud

The Scalability Reality: Vertical vs. HorizontalHCM has ALWAYS been a challenge of horizontal scale ability. This is something HR leaders understand implicitly.

Product Replacement

Manual-to-Platform

Product Introduction

Platform-to-Platform

Economics of HCM

Opportunity Competitive Demand

SIZE EMPLOYERSEMPLOYEES

(M)

5,000-9,999 1,707 12.8

2,500-4,999 4,180 15.7

1,000-2,499 7,158 12.5

500-999 15,811 11.9

250-499 37,034 14.0

TOTAL 65,890 66.9

Opportunity

Small- & Medium-sized businesses have different issues than

large enterprises

The Cloud has completely changed the economics of HR

technology. Solutions that were available only to large

enterprise organizations are quite affordable for SMB’s.

We will bring enterprise-level capabilities to SMB’s, and

build a brand that enterprises embrace.

• Less likely to have done it before

• Less likely to be familiar with readiness assessments Are they ready for a large technology project?

• Less likely to be conversant in, or resources for change management, centers of excellence, or best practices –

All areas of distinctive competency at GattiHR

0

5000

10000

15000

20000

Implementation Subscription

HCM Platform Costs ($000’s)

Enterprise Platform 2001 Cloud Replacement 2016

HR TECHNOLOGY IS ONE OF THE MOST-FUNDED SECTORS FOR VC

INVESTORS.

HR TECHNOLOGY CAN FINALLY MAKE A DENT IN HUMAN CAPITAL

ISSUES.

• Productivity growth is sagging• The biggest constraints to growth continue to

be human capital-related.

$72B

$164B$225B

$76B

Recruiting70% replacements, not adds

Training

Recognition programs

Managing absenteeism

$591M 1Q 2016 on-pace to repeat

$2.4B 2015: Raised in 383 transactions

Opportunity

Why?

US Spending on Managing Human Capital70% Employees who are

“disengaged” at work

$500B in lost productivity

The majority of employees believe the best way to further their career is to quit.

Companies have no idea who their best employees are, or where their next leaders will come from.

And yet…

Competitive Realities

Work is changing, and it’s re-defining the workforce.

Structures that support nimble, engaged, high-performing workforces. Technology is driving new solutions.

Companies need to create a new ecosystem for work

Small teams;Globally distributed

Workforce Silos

Open workforce ecosystem(employees, contractors, freelancers)

Outcomes-as-purpose;Work incidental

Rapidly evolving roles; Quick to adapt

Stable roles; Slow to adapt

Large teams; Central locations

Connected workforce

Limited workforce ecosystem (employees)

Work-as-purpose;Outcomes incidental

14

Entrepreneurial/Collaborative

Community/Social

Tech-Enabled

Sharing

Mission-Driven

ROI

ROI

But what’s in it for HR?

Stop doing busy work and focus on high-value work!

▪ HR▪ Everybody else

Call Volumes

What Employees Think HR Does

What employees say…

Handle disputes

67%

Create a safe & supportive workplace

76%

Process payroll

55%

Manage employee benefits

68%

Track time off – vacation, personal & sick

39%

Find & hire great talent

54%

Train employees

29%

Vs. HR’s Priorities & Biggest Challenges

Find & hire great talent

92%

What HR leaders say…

More effective employee engagement

72%

Build the employer brand

61%

Workforce Analytics

53%

Creating a safe & supportive workplace

48%

Building better leaders & managers

65% 14%

Managing high velocity change

8%

Upgrading obsolete tools & tech

Tech’s Opportunity for Impact

Full-suite HRIS upgrade

58% 36%

Recruitment

36%

Performance Management

36%

Learning & Development

52% of HR Leaders surveyed believe their organizations are unprepared for the high-velocity learning environment that the competitive marketplace is demanding

What Chatbots Can Do (So Far…)

Time off. ▪ Request, resolve scheduling conflicts,

auto-approve, flag exceptions, track.▪ Deliver balances, holiday schedules,

Recruiting –screen, schedule, correspond, track.

T&E – request, auto-approve, flag exceptions,

document, pay.

Answer pay questions Deliver payslips Answer Benefits enrollment & deduction

questions

Outcomes

Aligns customer & employee experience

▪ Engagement up▪ Performance up

Re-imagines process

Streamlines with Real self-service▪ Call volumes down▪ Productivity up▪ Performance up

Information capture at the source▪ Data quality up▪ Productivity up▪ Performance up

New Capabilities Introduced▪ Mobile Enabled▪ AI-infused▪ Cloud-based

integration

Why HCM Platforms are Uniquely Suited to Go First

Result: HR can lead the way on cloud migration.

Next generation of HCM software

Substantial cost savings Frees up IT resources

IntroductionDigital transformation is driving every organization to cloud-based solutions.

Adoption arguments are compelling…

But migration to the cloud is harder than it looks

Talented staff can focus on highest value priorities.

Save money – micro & macro scalar economies

Free up financial resources by getting out of the data center business – real estate, equipment, capital and staff cost

Manage risks

Migration skills are in short supply.

Data structures and applications are incompatible.

Exposing the customer experience to migration is risky.

© Ramco Systems www.ramco.com

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