Embarking on an S/4HANA-enabled transformation is a significant decision for any organisation to undertake. It can be fraught with competing priorities and decisions. It’s also a major investment, and realising the benefits is a complex task. However, too often the journey is focused on technology and processes, when what’s at the heart of a successful transformation is people. So, this is why you need to engage people properly and make the CHRO a key partner in delivering the transformation.
Human capital, the most precious asset
You have thought about the timelines, technology implications and have already battled a host of challenges to get to the start of your transformation journey. However, in all of this, have you considered your people? It’s often said that the most important and critical asset of a company is its human capital. So why do people so often feel left out of the transformation process?
Research Deloitte carried out on the back of several SAP implementation programmes revealed that the single biggest reason why transformation programmes fail is people-related factors1.
To deliver tangible and sustainable transformation business cases and the expected return on investment, the human transformation agenda needs to be as prominent in the implementation programme as the technology and system.
How to go about it: a roadmap
Admittedly, the human capital roadmap of an S/4HANA transformation programme may not be obvious at first glance. Often, the ‘people’ challenge is perceived to be a complex network of interconnected elements. However, if approached and managed properly, they can be the driving force to success.
To think through your people agenda, we have developed a framework to define your transformation ambitions from a people perspective and understand the tangible activities that need to be undertaken in order to address your key people priorities.
The framework includes:
Work - What is the role of the function or business area, how is work organised, and what capabilities are required?
- What work outcomes are we seeking to deliver?
- What opportunities exist to optimise & automate processes? How can we leverage freed capacity to add new value?
- What capabilities should the function have? Are new “digital” capabilities needed?
- How can we create alignment with our strategic objectives by re-thinking the boundaries, shape, size and roles of the future organisation?
Workforce - Who will do the work, what skills will be needed, and how will people access/develop them?
- What skills will the workforce need in the future?
- How can alternative talent models such as contractors, gig workers, and strategic partners support us?
- How will we enable our existing people to develop the skills needed, or make changes in our workforce?
- How will we deliver an employee experience that motivates and connects with our workers, and manage their performance against the new requirements?
Workplace - Where will people in the function work, how will we evolve our culture, and what leadership is required?
- What cultural traits do we need to develop to achieve our aspired vision and impact?
- What does the future physical workplace look like? Who will work where?
- What do we need to do to enable appropriate collaboration and break through silos?
- How will our leaders develop the capabilities to lead transformative change and role model future ways of working?
Our experience and observations with other organisations tell us that being able to answer the above questions for each element of the framework is a fundamental starting point, which can help you understand the maturity of your thinking in these areas.
Successfully understanding and effectively managing the transformation experience for your people through a robust change management approach will be key to achieving the business case, from basic adoption of new technologies, through to the creation of new capabilities based on a combination of technology and human elements, and realising the future state you envisioned.
Successfully embracing the Future of Work
However, thinking internally is only one side of the coin. There are other external factors that are putting pressure on your organisation to prepare for new challenges. Are your people ready for the Future of Work?
Work practices are changing fast. A whole host of disruptors means businesses will demand more from their people in terms of new sets of skills, capabilities and ways of working. People are also demanding more from the organisations they work for. They want to feel valued and do something meaningful.
Recent research carried out by Deloitte for its NextGen CFO programme indicates that 44% of respondents report their company has experienced a rise in recruitment difficulties or skills shortages over the last three months, and 51% of organisations plan to recruit from alternative talent sources. Furthermore, currently only 22% of organisations believe their companies are excelling at building a differentiated employee experience.
Your S/4HANA transformation is a golden opportunity to not only transform your technology, processes and data, but also to engage colleagues in a new dialogue and prepare your most important asset for a very different future of work.
By doing so, you will help your business be prepared for the great changes ahead, create an organisation that adapts easily, is agile and simple at its core. Most of all, you will create an organisation that attracts the best people and, most importantly, one that can evolve as seamlessly as S/4HANA does.