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Factoring Internal Talent Needs During the HRO Transition

Ironically, the effort to improve internal talent may require having outstanding talent upfront. Don’t be afraid to outsource staffing services as you implement your HRO program.

by Jason Geller, Anthony Scaglione

It’s an irony of HR transformation efforts. While many organizations seek to upgrade internal talent through HRO, talent in the organization’s HR function plays a critical role in the effectiveness of the transition. Signing a contract with an HRO vendor does not diminish the need for internal talent. On the contrary, we believe that the demand for skilled HR practitioners intensifies when organizations initiate outsourcing.

Before initiating the transition, you may need:
• Subject matter specialists to provide input to future process designs during the design phase, review documentation, and support training, as well as facilitate the transfer and testing of processes.

During go-live, they should provide stabilization support for all business processes.

• HRIS resources to validate system requirements, provide input about systems being transferred or implemented, and support system testing. During go-live, HRIS resources may assist the provider with newly transitioned technologies.

• Organization design resources to build the framework of the retained HR function, develop reorganization plans, and define severance and retention programs. During go-live, these resources should execute the reorganization activities and manage staff transition.

• Change management resources to plan and issue communications, engage stakeholders, and develop and deliver training.

• Project management resources to coordinate all aspects of the transition throughout each phase. They should manage the internal transition team, interface with the provider, oversee budget and resources, and manage relationships with stakeholders.

Specific competencies for each of these groups vary by phase. Team members should be willing to advocate new ideas, make decisions, and be accountable in complex and dynamic environments; establish working relationships with multiple parts of the organization; and build credibility with stakeholders.

Prioritize Assignments
Given that the transition can stretch from 12 to 18 months or beyond, organizations must assign staff that can commit to the timeframe. In most HR organizations, resource constraints make it likely that individuals most appropriately suited to support the transition are already double- or triple-booked. Be sensitive to burnout.

The transition demands an organization’s strongest resources. If resource constraints are anticipated, project leaders should be aware of the risks and determine mitigating actions. A resource-planning exercise is a useful method to prioritize initiatives, identify talent gaps and resource conflicts, evaluate risk of burnout and attrition, and define staffing assignments. Several strategies may be employed to address the gaps.

• Develop internal talent through training, coaching, and mentoring.
HRO projects offer an array of opportunities for skill enhancement and career development. With proper guidance, roles on the transition may be conduits to developing high-potential employees.

• Hire new talent.
Organizations that pursue this option should make their expectations about role descriptions and durations clear to candidates, as some positions may be deemed redundant after the transition.

• Engage freelancers on a limited basis.
This allows organizations the flexibility to shed resources later.

• Engage an established third party to supply temporary talent. It can provide greater access to methodologies, tools, and time-tested practices, allowing the transitioning organization to leverage the third party’s collective experience in HRO.

• Rely on the provider to supply talent.
This approach might seem intuitive, but its effectiveness depends on the specific resource and capability gaps that are being filled. While the most effective deals result from a “partnership” mindset, it is still a contractual arrangement, and separation of certain duties may be important to both parties.

Allocating insufficient resources or the wrong resources to an HR BPO transition can be as detrimental as not allocating any resources at all. Organizations that take a deliberate approach to assessing their resource requirements, evaluating available talent, prioritizing assignments, and filling talent gaps can increase the likelihood of an effective transition.

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