In Europe, the Middle East and Africa, Oracle has 14,000 employees in 32 countries, whose needs are met by an HR department of around 140 people. For the past four years, the HR department has been devolving certain HR functions to the line, using its own Oracle HR system.
‘We started with pay slips on the Web, instead of having hard copy pay slips’, says Vance Kearney, European HR director. ‘Then we enabled employees to access and update their own data, and since then we have introduced more and more Internet-based processes.’ The full range of HR activities now available on the internet includes:
management of purchasing of products and services bought from internal departments of the company.
‘It has given us far more flexibility’, says Kearney. ‘And it has ended the linear relationship between the number of people in the HR department and the number of people in the organization as a whole. We could probably increase overall staffing levels by 50 per cent without adding more HR people.’
To work effectively, stresses Kearney, a devolved HR system needs to be thought through in detail before implementation starts. It will need to be updated and added to over the years, but getting the system right in the first instance is essential if the organic process is to work properly.
‘You need to work out what needs to be different and what needs to be standardized’, he warns:
It doesn’t make sense to have 32 different systems to do one thing. But there will be a slight difference in the way that things are done in each country. For instance, when we started, we had 32 different telephone systems in operation, and now we have one global system. That is a process that can be standardized.
Other functions need more careful handling as well. Kearney cites the example of updating records – a simple process in the UK, but in Switzerland, where citizens are taxed according to the canton in which they live, the line manager must inform the tax authorities if an employee has moved from one canton to another.
As far as the role of HR is concerned, Kearney says staff at all levels have benefited:
Admin staff have been trained in dealing with people, rather than keyboards – they come in when there are specific problems to be dealt with ... Before this system was set up, we couldn’t answer a simple question like ‘What is the staff turnover across the company?’ because each country had a different way of deciding what this meant. It only took one computer to blow up in Kazakhstan for the whole thing to be out. Now we have one system which works across the world.
Source: Adapted from O’Reilly (2001)
1. To what extent does standardization of processes devalue the way in which employees work within their local environment and organizational culture?
2. Can a ‘one size fits all’ approach apply to all of the functions that HR carries out? If not, why not?