Global

HR
Transfo
rmation

March 2016

kpmg.com
 Today’
s
Today companies operate in an increasingly complex global environment, defined by four
key trends:

world
Growth Digitizatio
Now that economies, particularly developed n
Although the talk for many years, digitization
economies, arguably
have largely rebounded from the late recession, reached a tipping point in 2014. The digital revolution
companies is
are once again starting to look for opportunities for now a huge driver of change across sectors and
growth. geographies as companies are trying to figure out
With that, big projects such as product expansions what big

“ “
and data and the internet of things mean for their
mergersThe
andmain driver ofare
acquisitions change
back is
onour
the table. We’re investing in digitization; we’re
businesses.
growth playing
agenda. This is a very competitive catch-up in many areas. My area is sales
marketplace and there are lots of and
changes in the industry. marketing and certainly in those areas it
Sales director, Manufacturing
is
sector
impacting everything from customer and
Sales director, Energy and
Our goal is to take out substantial consumer relationships, go to market
resources
savings, but the intention is to use strategy, and selling products –
sector
savings to reinvest in the business everything.
Digital will grow exponentially in the
and
next
fuel growth. We are looking at our
few years – it’s urgent that we act
product set to make sure that it Finance director, Manufacturing
now.
meets sector
the current needs of consumers and
we
IT director, Manufacturing
are reinvesting in some existing
sector
brands
to reposition them.

Risk and regulatory Talent – An enduring

compliance challenge
With an increasingly complex regulatory environment, The challenges differ across sectors; however, talent
particularly in Europe and the United States, is a
companies are primary concern across the board. Some sectors that
feeling the pressure to stay compliant and are facing are
high perceived as less attractive by millennials, like
costs if they do not. Furthermore, they are looking to manufacturing, find it difficult to attract young
navigate the risks that the new digital economy poses employees;
along with the opportunities. others, like digital, although attractive, are fiercely

“
Information security is a huge risk competing for the same pool of qualified candidates.
– and this probably held us back Add
from to that the fact that companies are facing the
exploiting options such as mobile

“
pressure of
technology in the past. There are The shortage of talent is
baby boomers reaching retirement and it is easy to
technical issues to take into compounded by what we’ve all seen
being
understand why talent is one of the biggest issues on
account coming for a long time – baby
the
and one of the biggest constraints boomers
Operations director, Public agenda.
is retiring. If companies don’t address
sector this
information security.
issue, three years from now they’ll
CEO, Services
have
sector
no bench to speak of.
Source: Source for Consulting Complete 2015 Country
Research
 HR
Transform
ation

The KPMG
difference
Our brand
promise
With passion and purpose, we work shoulder-to-shoulder with you,
integrating
innovative approaches and deep expertise to deliver real results.
The client The KPMG
perspective
The market forces impacting our clients are varied and
many.
perspective
As a business composed of deep functional and industry
professionals, we are combining our services and bringing
Top of mind for our clients are issues surrounding our
globalization, the changing workforce, uncertain capabilities together to best serve our clients’ complex
economic needs.
forecasts, and regulatory complexity. Our clients tell us Our value proposition is grounded collectively in our
that people – a
these forces, coupled with competing, and often  We are passionate about what we do – We have
common way of thinking and a common way of working
 Bring the right teams and ideals and integrity.
high
contradictory, that
approaches
challenges
 drive the need
Deliver consistently to have
superior trusted
work business
and results that shapes
 our not
We are culture,
“one our experience,
size fits all” –and
Ourour clients’
people have
advisers
areimpactful to their experience:
wide-
that:
business ranging and diverse backgrounds; we do our best
 Have an informed perspective and are willing to
work
the status quo
challenge
when we bring our collective strengths to our clients
 We have a high devotion to our clients’
 Understand their business in a
success – We
deeply unified and coordinated way.
 Have their best interests at heart – and strive to are tenacious advocates for our clients’ success and
them successful
make we
strive to leave behind capability so our clients can
 Our working style is highly collaborative – We
sustain
work best
value.
with clients who want to team closely with their
advisers to
create an approach that is finely attuned to the specific
 We are practical and action-oriented – We are
needs and culture of their organization.
astute at
wading through complex issues to pinpoint root
causes of
problems, swiftly driving forth realistic approached
 We are specialists in what we do – We have equally
that can
deep
exceed our clients’ expectations.
industry and functional knowledge in the three broad
areas
we have chosen to specialize in – business
 We bring the breadth and scale of all our
transformation,
partners and
technology enablement, and analytics.
staff to bear for our clients – With sophisticated
knowledge around the globe and advanced research
and
thought leadership, we strive to facilitate
communication
and knowledge sharing globally across KPMG
member
firms.
KGS

35
 HR
Transform
ation

Our value
propositio
nDefining HR
transformation
At KPMG, we define HR transformation as creating fit-for-purpose people functions by aligning HR and business
strategy and
putting the appropriate structure, capabilities, and systems in place that enable HR to deliver real value to the
business.
Our point of view – The case for evidence-
based HR
We believe the HR function is at its best when its strategy, structure, tools, processes, and measures are
configured to reflect
the unique characteristics of its wider organization – and when data and analytics are at the heart of the function.
Evidence-
based decision making and workforce analytics can be the key to understanding where powerful connections in
people
management can be made. In our experience, analytics bring the rationale for how and where HR should “place
its bets.” It

Our
brings the justification for moving away from a “me too” leading practice driven HR to one that is configured to
the specific

capabilities
needs
The of the
primary organization
objective
sustainable business
of HRtotransformation
drive businessisvalue. This is thebuild
to successfully journey to what we call
HR capabilities that“My HR.”
drive scalable and

value. It requires a broad set of resources, skills, disciplines, experiences, and commitment from leadership to
achieve a
successful outcome. KPMG’s HR advisory capabilities span the full life cycle of HR transformation and focus on six
key areas:
HR Strategy Service
assess alignment delivery
ment & model
The HR assessment is the foundation
for decision making and justification
planning
HR strategy alignment and planning
set
The HR service delivery model is the
underlying conceptual framework
for the expectations for project scope, that
further investment. It is a review of timing, resources, and outcomes. supports the delivery of HR services.
the They It creates the overall “game plan”
current operating environment with focus on defining an HR strategy that for
the supports the transformation of an HR roles, responsibilities, span of
objective to identify the issues and organization with the goal of driving control,
opportunities for improvement (i.e., business objectives and maximizing and how work will be allocated
size HR’s efficiency and effectiveness. across
of the prize). three dimensions of the organization
HR Busines – Detailed
technology s case design
operational, strategic, and
strategy &
consultative.
&
&HR technology strategy is an
An
essential element of the service
roadma
The business case is used to assess
alternatives and justify a final set of
deploym
The detailed design and
implementation
implementat
delivery p
recommendations to present to ofent
the recommended approaches can
ion and should be closely aligned
model management. It contains the required begin once the key stakeholders
with the overall IT strategy supporting level of economic and intangible have aligned on the service delivery
the business. An objective detail to model and the business case has
understanding of the leading support the service delivery model. It been approved by senior
technology is management.
practices and associated vendor a fact-based document and The focus is on finalizing the
solutions is critical to an effective successfully approach,
transformation of the HR function. demonstrates a value proposition for design, and procedures as well as
senior management to make a implementing the technologies to
decision support the new operating model.
to move forward with a project.
5
 HR
Transform
ation

Our
approa
ch
We focus on creating fit-for-purpose people functions by aligning HR and business strategy and putting the
appropriate
structure, capabilities, and systems in place that enable HR to deliver real value to the business. Our services
include HR
strategy, HR service delivery model development, HR process redesign, HR team effectiveness, HR team
efficiency, and HR
value-added measures.
We Our
believe . . . differentiator
Our accelerated, end-to-end approach that
Focus should be on My HR, not Me Too integrates
HR
HR systems are there to support, not to
drive,
the strategy and operating model
Firms should measure the impact of HR
practices
strategic functional and technical
and policies on the delivery of business
HR should align strategy and operating
benefits
model to requirements configured to deliver
business objectives value.

KPMG Powered HR helps clients focus on what

matters
What is it? What is the value to
KPMG Powered HR is a cloud-based
solution
HR?Creates an evidence-based
HR
that puts HR professionals at the function via access to
forefront of
— Pre-built operating modelsItacross several analytics
Improves HR decision-making
their business’s strategy. offers:
industries to help you standardize your
ability
HR
processes more quickly and more Increases efficiency and
— Integrated KPMG analytics dashboards to
effectively effectiveness in HR process
data into real-life
turn
insights
delivery
— Efficient travel and visa Helps demonstrate HR is not a sunk
tools cost
— A single, consolidated system to
speed to value
maximize but a function critical to profitable
Enables future-focused change and
growth
Along with those pre-built models, we helps
bring ensure the talent is fit for the
our consultancy to the table and ensure Provides business leaders with
organization
that access
the models are configured for you.
to people data across their
Whether Provides differentiation where
your focus is talent acquisition,
enterprise
desired,
efficiency or
efficacy, KPMGframework,
technological Powered HR will
you
and standardization where
demonstrate
Establishes quickest route
needed
choose the
the powerWe
software. of HR to enhance
provide broader
the solution. to
business leading HR practice
goals and drive value in your adoption
organization.
And with options available for the
6
 HR
Transform
ation

Our
methodology
and tools
Our Next Generation HR methodology combined with a robust set
of tools and
benchmarks allows us to quickly add value to our clients.
Our practitioners work alongside clients to design and implement strategically differentiated HR functions that
can enable
sustainable competitive advantage for our clients. Our work is aligned to industry trends and informed by the
insights from
the highly regarded HR Transformation Survey (formerly the Towers Watson HR Service Delivery and
Technology Survey).
Maturity assessment HR New operating Implementation
benchmarking model roadmap

t
What is the people
agenda?

People
agenda
Which roles drive the most value
in
thelevers
Which HR value can
chain?
be used
to
Howenable
shouldthis value
value creation?
through
people
be measured and tracked?

How does the organization's

strategy
drive the HR
function?

What
Strategic
value
is the current business
proposition
strategy
and what are the critical success
2
1
factors
What are the implications of the
for delivering
business strategy it?
and other
corporate
initiatives on the requirements of
HR?

7
 HR
Transform
ation
KPMG has been named a Vanguard Leader in HR transformation by
ALM
Intelligence (formerly Kennedy). The prestigious ranking reflects
KPMG’s
global leadership in the HR transformation consulting space. KPMG
was one
of only two providers worldwide found to be “advancing service
Powered HR is a fully integrated, end-to-end HR transformation
breadth or
methodology
depth” of its HR transformation services.
that combines HR strategy, operations, and technology consulting in a
cloud-enabled environment.
KPMG has also advanced its thinking on building an evidence-
based HR
capability in research (enhanced analytics) that shows the
connection Recognized for strengths in
between HR and business performance. “analytics
KPMG’s acquisition of Towers Watson’s HR Service Delivery capabilities and the Powered HR
practice
platform that leverages cloud
makes KPMG a global leader in Workday-based HR service
technology to accelerate HR
delivery
consulting. With this deal, KPMG also assumes ownership of Towers transformation”
Watson’s renowned HR Service Delivery and Technology Survey and
Forum.

HR value
proposition
How does HR add value
to the organization and How is the value created by
enda? and be driven by
drive HR
the defined and measured?
Howbusiness
will HRstrategy?
use its key
levers to drive value?
HR design
What areprinciples
How can HR support
differentiation and the goals and objectives the
excellence at each HR
stage Whatfunction is aiming
are the critical to accomplish?
scoring measures
of the value chain? HR is
What are theevaluated on? which
criteria against
design
options for the “to-be” state will be
evaluated?

3
How can HR drive
and enable this

2 4
value?

HR
operating
What are the different
model
components
of the HR operating model and
how
Whatwill
arethey
the work together?

5
boundaries

Stakeh and
accountabilities across the

olders
HR
How will the HR
organization?
organization
implement and manage

/
these changes?

custo 8

mers
 HR
Transform
ation

Our
credent
ialsCase study: Financial services
organization
Case study: Consumer products
organization
Client Client
challenge
— A global investment management organization challenge
— A family-led global consumer product organization
required a required help
review of their HR function to increase efficiency, to align its HR organization to leading market practices
enhance and
— service delivery,
A key focus and ensure
was vendor the organization
selection for a new HRhad a fit- as
system — optimize
They neededthe services
a serviceoffered to the
provider businessalternative
to evaluate and
the for- employees
service
purpose HR function
legacy system for future
was highly global
manual andgrowth
did not provide while continuing
delivery to foster their
options supported by aunique culture.
high-level business case
ambitions.
adequate and
reporting functionality and managed information (MI) to design a scalable and flexible HR infrastructure adaptable
support to the
business decision making. needs of the businesses.
KPMG’s KPMG’s
response
— Conducted an HR operating model assessment and high- response
— Assisted in refining the HR vision/strategy and
level guiding principles
development of to direct design of the HR
review of current HR systems based on cost, — transformation
Performed an activity analysis survey of HR
— functionality,
Completed a benchmarking and external market employees to
effectiveness,
assessment to and risk determine how they spend their time compared to
highlight leading HR practices and compare performance — leading
Interviewed executive stakeholders external to HR and
— against
Produced similar organizations
a short list of potential HR system vendors that practices and drafted recommendations for
subject
were improvement
matter professionals from within HR to understand
assessed against cost, organizational fit, complexity to — leadership
Created and conducted an online stakeholder survey to
supported
implement,theandRFP process to
alignment forbusiness
the HR system vendor
requirements; perception of HR strengths and improvement areas
identify
short list
— Developed a current cost model and high-level business employee perceptions of the relative importance of HR
including a high-level implementation
case, — processes
Conductedand their level
workshops of key
with satisfaction with
HR leaders toeach process
— plan
Developed the people and HR strategies utilizing the recommend
output activities to be moved to a shared services operating
from the opportunity assessment, helping to ensure — model
Developed HR service delivery recommendations,
— alignment
Designed detailed operating model including defining and
new help
including a them model
operating to understand the benefits
with supporting of
cloud
to and
roles the overall business strategy transformation
— technology
Proposed sourcing alternatives with integration,
responsibilities, ways of working, and number of full-time financial
service, and implications
equivalents (FTEs)

Benefits to the Benefits to the

client
— Global HR operating model that will enhance service client
— Clear financial business case to support the proposed
delivery
— Enhanced MI and reduced administrative burden through model enabling the
operating
newHR system to enable focus on business partnering — transformation
Agreement on prioritized process and technology
— activity
Clear direction for the HR function, alignment of people recommendations for both “quick wins’ and long-term
improvement
andbusiness strategy — initiatives
Improved understanding of stakeholder perceptions
andrequirements of HR

KPMG is a recognized HR transformation thought leader with a

Leaders in global CoE
dedicated to creating leading insights, assets, and tools.
thought Designing Next HR as a Rethinking People are the
Generation HR driver for Human real numbers
organizational Resources in a
innovation Changing
World

Evidence-based Head in the Human Data, people

HR clouds or time resources and and profits
to be different? social media
From ‘Me too’
to My HR Tune in to Talent

9
 HR
Transform
ation

Case study: Government and public

Case study: Oil and gas EPC
sector
firm
agency
Client
Client challenge
— A global Tokyo-based Oil and Gas engineering, challenge
— A Defense agency launched an HR shared services
procurement, (HRSS)
construction (EPC) firm needed to operate stand-alone program to deliver a more efficient, effective, and
after connected
— acquiring an asset
The firm wanted tothat received
upgrade shared services,
the existing shared services people service to all of Defense. This initiative aimed to
including
function andHR,create an organization that had the right — improve
As part ofthe
theway people
HRSS services
program, the were delivered
Customer by
Access
from its former parent company.
processes examining
Channels
and capabilities in place to support the new business and refining
(CAC) projectbusiness
aimed toprocesses and simplify
improve and practices.access to
needs. the full
range of people services by reviewing and revising
existing
KPMG’s KPMG’s
channels and developing new ones.
response
— Conducted a current state analysis of the HR, IT, response
— Worked with Defense staff to gain an in-depth
facilities, and understanding
back-office functions to gain a clear understanding of of customer access requirements and engage HR
— current
Developed alternative back-office and executive business
processes and practices
organization — owners
Convened to help ensure people
and facilitated services
workshops were readily
involving HR
structures and approaches for review with the president accessible
business
to by individuals
process and
owners, their managers
service delivery staff, Web site content
— select the organization
Recommended best
a holistic fit to thefor
framework new company
sourcing, managers and other key stakeholders to identify the
circumstances
interviewing, — most
Developed and deployed People Connect, a new quick
assessing, and selecting new employees based on andefficient and effective mechanisms for providing
information
— behavior-
Suggested list of competencies and behavioral interview easy online gateway that enables military and civilian
based questionnaire
questions along with prevailing leading practices in personnel
behavioral — to access
Helped the full range
standardize of people services,
internet/intranet information,
content
advice,
applications to provide access to a “single source of
— interviewing techniques
Developed detailed job descriptions for back-office roles, management
support, and delivery
with core competencies prerequisite for the given
along — truth”
Developed an ownership framework that identifies
roles the
functional leads responsible for the development
and
sustainment of documents and scripts

Benefits to the Benefits to the

client
— Agreement by senior leadership team on the back- client
— Enhanced people services intranet site that provides a
office self-
structure going forward, including key position service environment for accessing people service
— decisions,
Roadmap to implement upgraded, independent back- — information,
Enhanced operations of the customer service center,
recruitment and assessment approach
organization
office advice, support,
responses
improving and delivery
to customers’ telephone
— enquiries
Streamlined access to online forms and other
artefacts

We have done this… many times

before.
Investment Consumer Professional Telecommunications Financial
company products services company services
company company organization
KPMG assisted in KPMG assisted in KPMG assisted in global KPMG assisted in the KPMG assisted in
transforming the HR evaluating alternative process design and development and redesigning the
function to drive service delivery offshoring of HR and transformation employee experience to
efficiency, enhance service options payroll processes from of the international deliver a consistent,
delivery, and develop a fit- and designing a scalable Australia, United State and HR mobile-enabled
for-purpose HR function to infrastructure.
and flexible HR Canada to a shared service delivery experience
support future global service model. employment lifecycle.
across the entire
growth ambitions. center in Malaysia.

10
Contact
us
Jean-David Aurange Philippe Valo
Partner, People and Director, HRIS
Change
T: +33 (0) 1 55 68 88 T: +33 (0) 1 55 68 29
61 10
E: [email protected] E: [email protected]

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