To successfully tee off its HR transformation efforts, PGA TOUR Superstores turned to an integrated HRO solution.
Different strokes for different folks. We’ve all heard that old expression. To most of us who have attempted to play our fine game and to many who have only observed, it is obvious that there are many different approaches to the game of golf. And in business as in golf, the most often chosen approach is not always the best and only option.
Unlike golf, however, in business the scoreboard that measures success is not wiped clean at the beginning of each new week. The financial reporting that measures our past performance must be dealt with effectively, seemingly every day. Retailing is a tough business. Margins are thin, and operations must be well managed. Even with the explosive growth we enjoy today, PGA TOUR Superstores has long been intent on staying focused on our core business model and alert to performance measurements and cost controls. Outsourcing has been one of many tools we use to stay competitive and profitable.
Early on, PGA TOUR Superstores established some guiding principles that have served us well. One of these is staying focused on our core business, so when it was time to replace our outdated HR systems and processes with solutions that would support growth, we kept in mind the guiding principle of freeing up time and capital.
Since our beginning three and a half years ago, HR administration (payroll, personnel, and benefits) has been outsourced to a provider who, in turn, outsourced piecemeal systems and functions to its partners, which included a national payroll bureau. The results were manageable when we were small. But as we advanced the business from 15 associates to 600 and opened new stores quarterly, this approach failed to keep pace.
Simultaneously, we needed HR expertise. Unlike many companies, we decided not to establish a traditional HR department. Our vision was to launch a strategically focused HR function (not department) to manage the growth of one of our key assets—our people. Our strategy was clear; our timing was not.
When HR finally arrived at the top of our priority list, we initially launched the project with the goal of replacing two-generation-old HR technology. We quickly eliminated the buy-and-implement software option in favor of an integrated, hosted, and secure solution from a single provider. We found one Atlanta-based provider with a solution that integrated service teams, service center support, and technology.
PlatformOne’s comprehensive HR BPO solution allowed us to replace broken systems and processes and still maintain our longstanding relationship with our insurance broker. Furthermore, with PlatformOne assuming total responsibility for all of our HR administration, we were able to simultaneously launch and integrate our new HR strategic function, which consisted of recruiting, hiring, training, employer relations, compliance, and more.
Our senior management directed us to search out and implement any business solution that would free up time and capital. Our new HR solution does both. Because the solution is outsourced, we require no IT operating expense or personnel to maintain HR systems, perform software upgrades, or manage technology infrastructure. Best of all, we avoided a huge capital outlay.
Often, projects may look good on paper in the planning phase, but implementations are rocky at best. Most times, the customer dictates additional requirements on the provider during this phase. And often, the provider oversells the ease of implementation. In our case, the delivered scope, content, timeframe, and cost matched the scope documents signed under our initial contract in July 2007. More than 15 months later, PGA TOUR Superstores has yet to be billed for a project cost increase or an implementation overrun. Considering that we launched the project with no luxury for delays and a firm January 1, 2008 cutover, we deem this project a model success. Our three criteria for selection were technology platform integration; team expertise and approach; and cost. When we did the math, the PlatformOne solution compared favorably at 10 percent below the market price.
While cost control is certainly important, improvements to our business are more critical, especially in times of growth. Today PGA TOUR Superstores enjoys faster responses to associates questions, more answers available on the first call attempted, better compliance with payroll tax laws, and an overall improved communication process with our new HR administrator. When you consider that we simultaneously teed off a new strategic HR function internally, it’s like connecting on a Tiger Woods-like 350-yard drive.
As controller, Matthew Prater helped found the PGA TOUR Superstore concept in early 2003. He can be reached at mprater@pgatss.com.
