As chair of the leadership committee of the HR BPO Buyers Group, Best Buy’s Andersen has her work cut out for her as she reaches out to the industry in an era of greater collaboration.
Being an industry leader has never been an easy job, and LeAnne Andersen experiences this effect on two fronts. As senior director of HR operations at Best Buy, she helps the Minneapolis-based household-name retailer maintain its top-dog status among electronic stores by delivering effective employee services.
That means when sales associates are on the floor, she explained, they must not be distracted by worries about whether their tuition reimbursement will come through or if their benefits will change following a life event. They should be able to focus on serving the millions of customers that come through the doors of Best Buy each year. That’s Andersen’s day job.
But, as the recently appointed chairperson of the leadership committee of the HR BPO Buyers Group, she’s also helping the outsourcing industry mature in a way that serves employers and providers alike in a rapidly evolving marketplace. In that sense, Andersen is truly an industry leader, and she plays a pivotal role in voicing the desires of buyers to their vendors at a defining time for HRO.
“I see the penetration of the market growing.…I see a lot more networking, and I see the breadth of the industry growing,” she recently told HRO Today. “We [Buyers Group members] all have different organizational demands, and our goal in the next 12 to 18 months is to show up collectively and remind people it is still a new industry and to create a sense of camaraderie and help mature the industry.”
The Buyers Group
The HR BPO Buyers Group was formed in May of 2004, when a group of large, pioneer HRO adopters informally gathered to discuss the difficulties they all shared following implementation. At first, the meetings were loosely organized and run by consulting firm Towers Perrin, which also collected data from the members for regular reports it put out. However, as more buyers signed deals and more members joined, the group expanded and began to hold regular meetings with a more formalized agenda and group goals. Today, approximately 45 member companies share their experience.
While the group’s goals are to help the industry mature and improve service delivery to buyers in all segments, only the largest companies can join. To qualify, an HRO buyer must outsource six or more processes to the same vendor and have at least 10,000 lives covered by the deal.
Regular meetings provide a forum in which buyers can speak frankly about their HRO engagements, but they are also forbidden to discuss specific contractual terms because of disclosure agreements. However, they are free to focus on common difficulties they share in their HRO engagements in an effort to develop solutions.
As chairwoman for the most important buyer’s organization in the HRO industry, Andersen is taking over the reins from founding chairman Mark Azzarello of International Paper. When he helped found the group, the industry was a markedly different frontier. That’s when many first-generation enterprise deals were just getting signed, and both buyers and providers exhibited all the naiveté of marketplace newbies. It was a time when buyers rushed to exploit HRO while providers jostled for market share, with neither side really understanding the implications and challenges of outsourcing HR’s services.
The backlash from those early-day deals is something that Andersen and her colleagues at Best Buy understand well because her company was among the first wave of adopters. And it’s also one factor that drives her to work with industry peers so they can help make outsourcing a workable back-office option. At the same time, Andersen added, participation in the group has given her a chance to learn from other members about their engagements, pain points, and resolutions. Not only does it help her better prepare Best Buy in its efforts to become an international retailer—the company is now expanding globally, having opened shop in China last year—but Andersen also said she views her efforts in the group to be partially self-gratifying.
“I get a lot of energy and engagement from learning. I took this on almost as a personal development project,” she added, pointing out that her career did not begin in the HR profession. Formerly a business leader at retailer Target, Andersen said she only became involved with HR five years ago.
HR and Business Knowledge
In this age of companies seeking out HR leaders with business experience, it’s not unusual to see senior HR executives who haven’t spent their entire careers in the confines of the back office. That’s because to really comprehend how HR can become a business partner to the rest of the organization, CEOs and COOs increasingly see a necessity for HR leaders to have business-side experience on their resumes. In Best Buy’s case, C-level executives want professionals who understand the importance of sourcing and staffing, Andersen explained.
Having this knowledge is especially helpful when working with HRO service providers, Andersen said, because the sides must collaborate on growth initiatives. For the electronics retailer, being able to rely on its vendor, Accenture, is a necessity as the company looks to grow its presence abroad. Having only staked a presence in China last year, Best Buy will need support from its vendors as it expands its footprint.
Andersen noted that one of the benefits of HRO is that it has matured during the past several years to competently address a variety of geographies and businesses. She attributed this to the marketplace becoming more sophisticated in addressing client needs. “We all have slightly different models,” she added. The market “has to be sophisticated enough to handle all of these.”
Part of that sophistication is the implementation of process excellence, which Andersen said HR has not enthusiastically embraced in the past. With HRO helping to usher more discipline into the back office, organizations benefit from the rigors of such an approach with greater predictability and repeatability. “HR as a whole is learning the necessity of process excellence,” she pointed out.
Andersen, who first became involved in the Buyers Group in 2006 when she was asked to serve as the buyer member representing the vendor community, said as its current chairwoman, she would like to see the organization work more closely with others in the industry.
“We’ve been fairly isolated, in that we prized so much our independence. That remains fairly important to us,” she said. “However, we realize that as we mature and our goals mature, we need to have more prominence in the industry. We can’t do that in isolation.”
The Buyers Group typically doesn’t include providers at its meeting, but it has shared with providers some of the findings and discussions with vendors. These efforts were all part of its outreach to help the industry improve service delivery and anticipate buyer needs.
In addition to working more closely with the vendor and sourcing advisory community, the group is striving to collaborate with other trade organizations such as the HRO Association. She said the message the Buyers Group wants to send out in the near term is “Shape us, teach us, help us to learn.”
While the dialogue between buyer and provider hasn’t always been pleasant—after all, first-generation HRO has led to high levels of dissatisfaction—Andersen said the industry has come a long way since, and today’s conversations have evolved, as well. “I do think the conversations will become more mature. I hope for a constructive tone, and I think there will be more candor,” she said, attributing this shift to a more educated buyer community, as well as a more savvy provider group.
That, in turn, has led to changes in the Buyers Group, she noted. What started as an informal gathering of like-minded pioneers is now a well-organized association of top HR leaders seeking to better their experience with HRO, and as its leader, Andersen perhaps reflected the zeitgeist when she added: “Where it has evolved now is a collective spirit around the issue of how we provide input to the industry.”
The answer, it seems, will surely come as the group moves from the isolationist stance it once embraced to the more collaborative position that Andersen hopes to bring.