A Three-Part Series — Part Three
In our previous two blog entries, we discussed how analytical insight must do more than simply enlighten managers about the workings of their organizations. It ought to provide guidance for planning, regardless of the time horizon or functional objective (e.g., strategic, operational, shift, project). We also described some of the ways businesses address analytics shortcomings that often interfere with strategic planning.
Yet despite having powerful ERP solutions available, businesses still all too frequently perform manual forecasting, which is cumbersome, prone to error, mostly operational in scope, and stored in a single-use set of tools and documents. Potentially useful workforce data rarely re-emerges once the budgeting process is closed, and does not shape further strategic planning.
Because the process is manual and performed in ad-hoc steps, it is difficult to consolidate planning across the organization, and accumulative amounts of misalignment occur between levels, functions, and departments. It is not surprising that as the view of the workforce becomes murkier, there is no consensus on the right intervention for a given situation.
As a consequence, aligning the workforce with business objectives and work demand becomes increasingly challenging, as strategic initiatives are not supported with sufficient numbers of qualified employees, and appropriate resources cannot be sourced in time or without significant additional costs. Businesses therefore become less able to anticipate potential skill shortages, or identify similar risks regarding the workforce and its readiness.
HR and Finance on a single platform
Workforce and financial data have historically been housed across multiple systems, creating technological limitations that compound analytical shortcomings. Cloud computing is about to change history by eliminating both kinds of deficits.
A cloud-based single platform of HR and Financial systems alleviates the majority of effort in integrating data from multiple sources. Consolidation and reporting of data becomes less complex and costly, and cycle time from point of data demand to delivery of strategic insight is decreased. Even smaller organizations become well-able to perform these tasks in house cost-effectively, without relying on multiple or third party sources to integrate data. Businesses no longer get placed at an arm’s length from their data, and analysts become less burdened with tangential competencies that have become prerequisites for data analysis proficiency, such as contracts and vendor management.
On-premise technologies of the past did a formidable job storing data by treating each business function area in isolation. Yet HR reporting and analytics, always a challenge even in the best of conditions, have become several orders more complex as performance improvement initiatives reach across corporate functions, overlaying workforce data with sales, financial, health and safety, operations, manufacturing, and supply chain data to determine correlations and predict trends.
A cloud-based integrated platform that also contains predefined libraries and models contributes substantively to establishing a solid basis for inquiry, allowing managers and analysts a quick start in workforce planning, in key areas such as demarcating strategi, operational, and resource planning. For advanced applications, simulation and modeling becomes feasible, particularly in areas such as headcount planning and budgeting, and organization chart modeling for mergers, acquisitions, and reorganizations.
Let it rain
Since the 1960’s we have heard business leaders go on dryly and interminably about how “people are our most important asset.” And since the 1960’s businesses have experimented futilely with dozens of financial and analytical methods trying to put their money where their human capital is. Few would doubt that human capital is shaping up to be a major economic force in this century, one that cannot run on last century’s technology or organizational rifts. HR and Finance continue to manage the most valuable investments in the business. Yet for the first time, their efforts can be combined on the cloud, and their analytical skills converge like masses of air and water, thereby becoming the rainmaker in every business.
To learn more in detail about the ways integrating HR and Finance can benefit your organization, including the specific processes it can improve and the business value it can produce, please read our white paper: Workday Financials: 6 Advantages of a Unified Finance and HR Platform.