Developing Global HR Services at Lendlease
Globalisation and a changing workforce are driving HR transformation in the Australian market. While there is no ‘one size fits all approach’ to HR transformation, for most organisations, improving the strategic value HR can provide to the overall business seems to be a common goal.
Over the past three years, property management giant Lendlease has responded to these market challenges by developing and rolling-out a standard process framework across HR services, with the aim to ensure HR is aligned to the business and the broader economy.
Ahead of Shared Services and Outsourcing Week Australasia 2016, Melinda Stewart, Head of HR Services at Lendlease, explores how the company is developing a global workforce planning capability and the steps they are taking to overcome the challenges of managing a function that provides services globally from one location.
Developing a standardised process framework
"At Lendlease, we use a standardised process framework across all our HR processes to ensure any new scope identified with HR is aligned to the economy and broader business, whilst also taking specific country legislation and requirements into consideration.
Our HR services are run from Sydney and provide transactional and support services to approximately 12,000 employees in ten countries. As a result, we have a vast array of different solutions, specific benefits and polices we need to be across.
Although we have different HCM solutions for core HR and Payroll, we also have some global systems in place to manage areas like compensation, performance, learning and workflow. It is imperative that we implement standardised processes to bring all of these areas together, otherwise efficiency is difficult to achieve.
Simplification and standardisation is a key focus area of the Group CEO, so having strong sponsorship and executive leadership to achieve our objectives is helping us to achieve our goals. In our HR function, we are also looking at ways to generate efficiencies and cost savings across the business. The more we standardise the better – our team’s aim is to add value and to move up the value chain of shared services. This means moving away from simply performing completely transactional services and moving towards providing more strategic services. This has been a strategy that has been in place since November 2012."
Identifying how cost savings and efficiency gains can be made
"When it comes to identifying efficiency improvements, sometimes it is just as simple as questioning and asking why something is done differently. A perfect example of this is our US business. When it came to paying severance for a long time, our US arm would pay it out according to the bi-weekly payroll cycle.
This meant that if a project came to an end and we needed to let people go, severance would get paid out across the eight –bi weekly payroll cycles, which enabled staff to continue to attract benefits such as medical etc.
Based on my previous experience at another organisation who operated by paying severance in lump sums, we calculated we could save quite a considerable amount of time in benefits savings, but also in the administrative overhead of offering extended severance. So in December we moved to having a lump sum severance payment up front.
Figuring our how to identify these efficiency gains comes down to questioning, comparing and contrasting operations in numerous locations and asking: why is it done differently here in comparison to other locations? Then it’s about bringing it into line and looking at the advantages that can be gained from that."
The challenge: Managing GBS from one location
"Managing a global function from Sydney is not something Lendlease would usually think to do, considering labour and property costs are quite high. It is also often difficult to find resources with multiple language capability, and time zones are also an issue.
But our focus at Lendlease was to establish a global function close to the global head office, which is in Sydney. It wasn’t just about money, it was about having close proximity to senior leaders so they could have a presence in Shared Services and a strong executive sponsorship for the program.
Our global leadership team provided us with the initial platform to have discussions with regional teams. As a business, it has been a little more challenging for regional teams to accept the global function will be run from Sydney, rather than having teams run out of the US. But building relationships and engaging with stakeholders face-to-face, as well as focus groups with employees regarding what is working and what is not, has really paid off. For example, in 2014 I spoke with 250 employees in different locations and it has quite significant benefits.
Another challenge has been finding employees to work over nightshift – because we operate a 24 hour service for our contact centre employees in the UK and US. The best people don’t necessarily want to work at night and although we provide additional allowances, our aim is to ensure we get the right people for this job, rather than simply anyone will do the job. Providing excellent customer service to our employees in all countries is of utmost importance, so therefore getting the right people for the job is very important for us."
Using analytics to expand the scope of Shared Services
"When we first started HR Services in late 2012, we were reporting out to different parts of the business. But now we’re able to analyse a lot of the data and provide better insights to our business. We are providing further information in our offices around labour problems and financial liability and as we identify trends in information we can share, our offices are coming to us and seeking further information and help.
This is growing the capability of our function, but we also use this information to drive our own internal focus – whether it’s around adoption of self-service tools and systems, or greater consolidation of some of the practices we have.
Data and analytics have also enabled us to compare volumes of transactions and to look in greater detail at some of the end-to-end processes and how to improve them. Analytics are used in identifying the number of hand-offs in a process, or the time it takes for a manager to approve a transition or complete a certain step. Getting the data is one thing, but it’s what we’re doing with it that is proving to be most beneficial."
The results so far
"When HR Services was established at Lendlease in November 2012, we were supporting about 3,000 employees in Australia only. Now we’re supporting 12,000 employees in ten countries and more than 3,000 of those are construction and blue collar workers who don’t have access to computers – which provides us with a challenge to be able to support, so we have to do things differently.
Our function is now four times the size it was two years ago and a lot of this growth has been scheduled and planned. In addition, we have been able provide a lot of additional support for different offices and businesses through acquisition, which has been a huge achievement.
In terms of transactions and volumes, we get over 23,000 calls to our internal contact centre each year and 33,000 enquiries are managed each year – whether that’s by phone, email or online. We generate a huge number of job changes and just purely manage people in the organisation. When you look at the statistics collected over a year, it’s quite substantial what’s actually happening and as we continue to grow and the organisation grows, we’ll keep adding to that.
We’ve also increased the number of support services we provide. Some of these services are small, but they make a difference. For example, initially we weren’t providing support for redundancies but now we are. We also now support acquisitions through significant recontracting. It’s the small pieces that are making a different to the organisation."
5 Tips for organisations who are looking to expand services globally
- Get executive sponsorship up front. If the senior leaders aren’t brought into it, then it won’t work. Spend a lot of your time getting them on board.
- Be prepared to conduct a lot of research. Go out and do research checks with other organisations and find out what’s worked for them.
- Think about what the right location and environment should be – should it be outsourced? Should it be a captive environment?
- Understand the drivers of why you want to establish a global shared services function.
- Commit 100 per cent. Once you have made the decision to roll out global services, commit to it. The moment you start to back off, people will lose interest and it won’t happen.
To learn more about how Australian businesses are approaching global business services, join more than 500 shared services practitioners, analysts and industry experts at Shared Services and Outsourcing Week Australasia 2016.