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Delta Air Lines is implementing SAP to replace a 30-year-old mainframe system, in a dramatic change designed to...
take advantage of the vendor's "best of breed" approach to human capital management software.
Delta, which operates in 64 countries, began implementing the SAP global HR management software in phases in June and plans to go live 18 months from now, said Chris Collins, vice president of global HR services.
"In our world, this is a once-in-a-lifetime investment," Collins said during a session at the recent HR Technology Conference & Exposition in Las Vegas.
Delta purchased SAP partly because it believed the vendor was best for configuring the software to meet specific needs of the airline including handling time and attendance for employees, compliance and payroll, Collins said.
Delta was also seeking the assurance of a tightly integrated system, he said. The airline currently uses different systems for applicant tracking, talent management, learning, core HR and analytics. SAP will provide employee data management, as well as Concur for travel and expense management, Fieldglass for managing labor and services and SuccessFactors for learning, performance and goals and other talent management functions, he said.
Collins was on a panel with Natalie Morris, director of employee benefits at United Technologies; Bill Tompkins, senior vice president of human resources and total rewards at Macy's; and Erica Volini, leader of HR transformation at Deloitte Consulting.
The HR leaders discussed tips for selecting, implementing and integrating global HR management systems, and how to justify big investments and manage change. Josh Bersin, founder and principal of Bersin by Deloitte, was moderator.
Macy's, the Cincinnati-based retailer, will use the Oracle system for about 175,000 employees, including approximately 120,000 hourly workers. The project involves consolidating 2,000 business processes to fewer than 200 and combining seven HR organizations into one, Tompkins said.
Macy's chose Oracle partly because it already uses the vendor for financial management and Oracle-owned Taleo for recruiting, Tompkins said.
As one way to help ensure success, Macy's is requiring regular meetings with senior product managers at Oracle, along with an Oracle leader who sold the software, he said. It's key for product managers to understand the promises made by sales.
"It has been phenomenal," he said.
Cloud means fewer decisions upfront
Tompkins said it is important to understand that cloud software involves continuous innovation and a long-term strategy.
With on-premises software, all HR decisions needed to be included in the original capital request well before launch, but cloud means that many decisions don't need to be made at the start. Managers at Macy's, for example, were debating whether to drop ratings from performance management, he said. "Slow down, guys," Tompkins said he told his colleagues. "There are two releases every year. It can be configured."
To drive the business case for the new system, Tompkins said, it is critical to involve executives from various parts of the business. Macy's created an oversight council that included advocates and skeptics and it meets every couple of months.
A logistics leader, for example, was sold on the new HR system after seeing that it was similar to the creation of an organization for delivery trucks a dozen years ago, he said. "They start to see the parallels of their journey with the HR journey. That has been a big help."
United Technologies, based in Hartford, Conn., is using a phased approach to integrating Workday HCM with ADP payroll. China will follow Singapore, Morris said.
In the U.S., Workday is scheduled to go live in April 2017 and will be integrated with ADP's EV5 platform for payroll, she said.
The integration is a little more intense than expected, Morris said. "Workday and ADP are great products ... but getting them to talk to each other -- that is a new thing. We are really working that."
To win approval of executives for Workday global HR management, Morris said, she put together "cold, hard facts" including benchmarking data from comparable companies with modern global HR management systems.
Workday innovation key to selection
She said that she also persuaded leaders at United Technologies by demonstrating a need for analytics, mobile capabilities, reporting and technology to assure compliance with tax and other rules in China, Germany and other countries.
To gain support for the project, Morris said she used her skills at getting along with others. "I did a lot of socializing. I spent a good year just visiting all the different businesses."
With about 220,000 employees and six major business units, United Technologies often struggles with HR systems that are so outdated the company lacks a precise count of employees, she said. It can take weeks for HR to answer a basic question from leadership.
United Technologies, a provider of products and services to the building systems and aerospace industries, was built through acquisitions, especially overseas, and made few investments in HR technology, particularly outside the U.S., Morris said.
"We had some very compelling compliance matters," she said. "Because we are a defense contractor, we need to know who our employees are, where they are from and what they are working on."
Generally, organizations choose one implementation partner, but Delta, based in Atlanta, is using four groups, including Deloitte Consulting, Xerox, SAP and employees from its own company, Collins said.
Implementation leaders are working as a team after Delta held months of planning sessions to develop a detailed blueprint for guiding integration. Delta chose multiple implementation partners largely because it is experienced at managing performance of vendors, and also because each partner offers special expertise, he said.
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