Asia Pacific companies to see big change in HR function

BANGALORE, INDIA: About a third of Asia Pacific-based national and multi-national companies anticipate significant changes in their human resources departments in the next couple of years, as they seek greater efficiencies and to improve the processes within the function, according to an annual survey by global professional services company Towers Watson).

The survey revealed that companies are considering new HR technologies, will continue to invest in HR technology such as mobile applications, and plan to review their HR processes. However, at the same, time 49 per cent of Asia Pacific companies currently lack a formal written HR strategy to lay out the role of the function within the business.

The 2013 HR Service Delivery and Technology Survey, a global survey of 1,025 companies, including 578 based in Asia Pacific, found that a third of respondents (33 per cent) will make a change to their HR structure before the end of next year. Among companies changing their HR structure, nearly three-quarters (73 per cent) are doing so to realize further operational efficiencies, while just over half (52 per cent) are doing so to improve quality. Another 38 per cent are pursuing a change in business strategy or seeking to achieve cost savings (24 per cent).

For the Asia-Pacific region, the survey shows that HR technology spending remains steady and strong despite cost reductions in other areas of HR. More than half of organizations (53 per cent) indicated their investment in HR technology this year will match last year's investment levels, while more than a quarter (27 per cent) will either increase or significantly increase their HR technology investments.

Almost a third (31 per cent) of the Asia-Pacific companies surveyed plan to implement or are in the process of implementing a new HR management system. SAP (Legacy HRMS 20 per cent, Success Factors 4 per cent) and Oracle (PeopleSoft 15 per cent, Legacy HRMS 6 per cent, Fusion 2 per cent) are the main suppliers, followed by Workday (6 per cent), all of which account for 53 per cent of the new HR management systems chosen. Global capabilities and costs are the key selection criteria. For SAP, lower upfront costs were cited by respondents, while it was predictable ongoing costs in particular that attracted Oracle users. 

HR is also catching on to the mobile technology trend. Nearly half (46 per cent) of respondents now provide mobile access via smartphone to employees, with iPhone (60 per cent), Blackberry (35 per cent) and Android phone (32 per cent) being the devices supported. Some 17 per cent of companies provide tablet devices, with the iPad (51 per cent) and the Android tablet (19 per cent) the preferred devices. A number of the companies surveyed (12 per cent) operate a "bring your own device" policy.

But HR-enabled applications are in their infancy: just over one in 10 organizations (13 per cent) in Asia Pacific currently use mobile applications for HR purposes. This trend is expected to accelerate, albeit at a moderate pace, as 13 per cent of companies plan to offer HR-enabled applications in the next 12 to 18 months. However, more than half of organizations have no plans to leverage mobile applications before the end of 2014.

While only 51 per cent of companies in Asia Pacific have a defined HR strategy in place, a further 31 per cent of companies plan to implement such strategies within the next 18 months. In terms of HR strategy focus, the standout key areas among those surveyed in Asia Pacific are training and development (67 per cent), identification of high potential individuals (63 per cent), performance management (60 per cent), succession management (58 per cent), employee management (54 per cent), and recruitment and selection (53 per cent).

Robert Zampetti, director of Towers Watson's Asia Pacific HR Service Delivery practice said: "We're seeing elsewhere in the world that companies are carefully examining both their HR structures and the way HR services are being delivered, and Asia is no different: there's a need to review, refine and enhance for the function. What is really interesting is the continued trend toward replacing core HR systems, and a willingness to invest in new technology and partners with a growing shift toward software-as-a-service."

"Without question, HR service delivery is in a state of change. This means they can change the game by modifying their structure, rethinking long-held processes, adopting new HR technologies and processes, and extending capabilities to the organization via manager self-service and shared services. In the end, it means using new concepts, approaches and technology to provide better HR services," said Zampetti.

Other key findings from the survey include:

· Greater involvement in strategic business-driven issues was ranked as the primary HR service delivery issue this year (35 per cent), followed by streamlining business processes (33 per cent).

· Nearly half of the organizations in Asia Pacific surveyed (45 per cent) offer an HR portal to HR and employees, while 7 per cent have an HR portal available to HR only. Another 18 per cent are working to develop a portal.