Whitepaper

Definitive Guide to Strategic Human Capital Management Consolidating Strategic HCM Functionality to Optimize Your Workforce
In the realm of human capital management, theres a new wave of thinking about what it means to be strategic and drive workforce effectiveness. Riding the leading edge of this wave are the savvy human resources executives, driving their organizations with a forward-thinking, strategic and integrated approach to human capital management. This new wave is commonly known as Strategic Human Capital Management (HCM). At its core, Strategic HCM enables a whole set of so-called cross-process workflows, such as integrating recruiting and onboarding or pay-for-performance. They are cross process because they span the classic silos of HR to provide a more efficient, effective approach to human capital management. Below are a classic set of these cross-process flows enabled by a Strategic HCM solution and industry examples to which they can apply.
Talent Management Learning Management Workforce Management Payroll Management

All Industries
Talent development for key strategic competency focus for company

Learning development suggestions and assignments based on competency gaps Incentive compensation based on Performance and schedule adherence Demand driven talent succession, hiring, and development plans based on gaps Schedule based on employee compliance, certifications and/or performance Training schedules aligned with work schedules

Services Industry
Managing variable pay based on contract assignments

Retail Industry
Demand driven hiring of employees and contingent labor based on optimized schedules

SumTotals endto-end Strategic HCM solution enables businesses to track their workforces across the needs of the entire organization, increasing the visibility of budding problems and the efficiency of the initiatives used to solve them

Healthcare / Manufacturing Industries

Validating certification to operate a machinery before assigning resource to schedule

Healthcare Industry
Managing performance based on time spend with patients and critical shifts

Typical cross-process flows for Strategic HCM

Industry needs for Strategic HCM cross-process flows

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Definitive Guide to Strategic Human Capital Management

At the highest level, Strategic HCM enables human resources to effectively work with executive management to help create and execute the organizations strategic goals by providing a single source of truth for all workforce-related questions. By providing one, unified employee profile across all HCM processes and making that information easily available for analysis and further correlation with business data, Strategic HCM solutions provide HR and management a true strategic planning tool. More importantly, this planning tool is integrated with all the cross-process HR systems that are needed to tactically execute all HR functions.
Transformation

Strategic HCM Processes

Workforce Strategy & Planning
Acquire to Onboard (Recruitment) Perform to Reward (Performance Mgmt) Assess to Develop (Learning Mgmt) Plan & Schedule to Pay (Workforce Mgmt)

Enablement

Core HR Record

Profile & Social Connections

Skills & Competencies

Compliance (Expense, Payroll, etc)

Infrastructure

Basic Record Keeping

HR Transaction Management

ERP Finance & Project linkage

Tactical HCM

The diagram above demonstrates the relationship between the Strategic HCM and tactical functions that HR classically executes. This paper focuses on the on the main transformative solutions that Strategic HCM can provide: A Single Source of Truth

Acquire to Onboard Perform to Reward Assess to Develop Plan and Schedule to Pay Closing the Loop

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Definitive Guide to Strategic Human Capital Management

A Single Source of Truth Centralized HR Information

Oftentimes, as an organization grows, the various aspects of human capital management become the responsibility of disparate systems or groups. One consequence is that, over time, organizations develop silos of employee information, with each profile containing only the information required for the specific function. This can lead to inefficiencies and inconsistencies as changes fail to propagate completely throughout the company.
Recruiting Prole

Mary Smith HR Prole

Mary Smith Payroll Prole

SumTotals Integrated Strategic Human Capital removes the ine ciencies and inconsistencies of siloed functions and creates a clean prole with end-to-end, real-time capabilities.

Employee Prole

Mary Smith

Mary Smith Scheduling Prole

Mary Smith

By centralizing these functions in one integrated Strategic HCM solution, organizations are able to automate and connect all of the HR information. SumTotal empowers HR managers with the ability to maintain consistency, ensuring that all necessary parties have access to the same up-to-date information by managing one central profile for each employee. A centralized employee profile provides a single source of information on your talent pools information, skills and competencies. The result: providing HR and executives a closed-loop relationship between business and workforce planning and strategy.

Acquire to Onboard
Hiring a candidate to fill an open role is not the end of the process for a business. The onboarding process for a new employee is only complete when that person is satisfactorily productive in a new role. Accomplishing this in a timeframe that meets business needs often requires this candidate to be appropriately skilled and motivated, with a solid understanding how his or her actions affect company goals.

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Definitive Guide to Strategic Human Capital Management

An essential feature of any complete Strategic Human Capital Management system is that it must allow HR managers to manage their talent pools proactively. Instead of only solving problems as they arise, a successful organization must be able to predict its own needs and act to promote priorities and actions that maximize the chances of success. With SumTotal Talent Management, managers can keep a finger on the pulse of their workforces, know an employees abilities to achieve optimal output, and understand employee weaknesses to guide training and hiring. Bring in the Best - Making changes to your workforce can be risky and expensive, especially when hiring new employees. Having a complete set of information available allows HR managers to quickly and easily identify the best possible candidates for hire or promotion among all those available. SumTotal Talent Management can help managers identify gaps in their workforce and guide them toward candidates who are skilled, trained, motivated and aware of how their performance drives the entire organizations success. Combined with SumTotal Learning Management, organizations can get the best employee for the position on the job quickly and efficiently. Optimize your Talents - Even given the appropriate information, its often far more efficient to optimize your talent pool than to increase it. Consider a situation in which an existing resource is dissatisfied with his or her employment and is considering leaving the company. Meanwhile, in another part of the organization, managers are struggling to fill a vacant position, and the delay is costly. Without the visibility provided by a fully integrated Strategic HCM solution, the managers may never know that a potential candidate already exists within the organization, the source of the employees dissatisfaction or that the employee is dissatisfied at all. The company stands to lose a valuable resource and is still left with the task of bringing on a fully new team member to fill both vacant positions. An integrated Strategic HCM system helps managers approach such issues multidimensionally. The visibility into the current workforce ensures that potential internal candidates are considered, and the individualized talent profile helps organizations prepare employees for advancement. With SumTotal Strategic HCM, companies can nurture talent and maintain morale to limit attrition and prepare for future needs with an actionable leadership development plan outlined below.
Define Career Goals
Integrated goal mgmt. Integrated employee profile

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Knowing that its most prolific time of business comes in the last quarter of the year, a national photography company expands its workforce annually from a core of 4,000 to a peak of 20,000 in a few months and then back down. The company needed a solution to both find and management this amount of talent, particularly because the temporary employees seemed to keep losing track of their goals and core employees were not effectively able to transfer their knowledge. These problems not only made the new hire experience in learning how things worked extremely arduous and time consuming, but also tended to create a system of positional power for those who did hold that knowledge, which could diminish the companys representatives overall ability to work cohesively toward a goal. Using SumTotal Talent Management, the company was able to develop and disseminate requisitions for candidates with specific skills. After the HR department sourced and filtered these candidates using guidelines set out by the company and held in SumTotal software, the companys priority was to onboard the new workforce quickly so that the employees were prepared to meet business needs in a specific timeframe. Instead of having an HR department that had to invest too many resources in managing the bureaucracy that can come with quintupling the workforce seasonally, the department is able to use SumTotal to find and develop the necessary candidates to have a profitable year.

Develop personalized training paths

Integrated learning mgmt. Integrated development planning

Perform Gap Analysis

Integrated performance mgmt. Integrated competencies

Track potential
Integrated succession planning Integrated analytics

Keep workers compensated in line with performance

Integrated pay for performance

Form and enact detailed succession plans

Integrated succession planning Integrated analytics

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Definitive Guide to Strategic Human Capital Management 2009 State of Global Talent Management

Perform to Reward
Perhaps the greatest measurable benefit in Strategic HCM comes from the relationship between performance management and compensation management. These two processes encompass the management, tracking and execution of the organizations strategic and tactical business goals, as well as the management of the organizations largest controllable expense and best resource employees. The result of successfully linking these processes can drive real results across the business. In fact, SumTotals own external study of over 300 senior-level HR practitioners from around the globe showed that the integration of performance and compensation management processes correlated to a measurable reduction in voluntary turnover across their organizations. Today, performance management has one the highest rates of automation of any HR process in organizations across North America and is becoming more common in other parts of the world as well. The prevalence of automation has also helped bring about agreed upon standards for goal and competency management and measurement. As a result, the move from simple process enablement to the more valuable HR transformation is in process at many organizations today. Still, organizations lose the efficacy of perform to reward when their methods of planning and executing compensation management are extremely complex and customized often done with desktop tools such as spreadsheets and documents. Without centralized management of the process, including a workflow and business rules engine, compensation management is often riddled with gaps and inconsistencies. The cost of these issues is high for the organization both in financial terms and on employee morale and turnover. Best-in-class organizations integrate these two processes together, creating what is commonly referred to as a pay-for-performance process. This combined process helps to transform the way businesses manage and execute aligning rewards with top performance. Organizations with a pay-for-performance process are able to objectively measure goal achievement and tie it directly to effective incentive programs to increase individual and overall business performance.
In fact, SumTotals own external study of over 300 senior-level HR practitioners from around the globe showed that the integration of performance and compensation management processes correlated to a measurable reduction in voluntary turnover across their organizations.

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Definitive Guide to Strategic Human Capital Management 2009 State of Global Talent Management

Assess to Develop
Whether an employee is newly hired or promoted, an effective training program is essential to minimize the time to productivity. Even existing employees benefit from continued training on new processes or responsibilities. With a learning management system like the one integrated into SumTotals Strategic HCM solution, organizations can streamline on-boarding and employee development.
Integrated HRMS provides one unified record with all info, for better reporting Integrated Workforce Analytics

Single Record for all Learners

Use learning compliance / completed courses as data points that can drive compensation

Drive Compensation Incentives for Learning

Automatically push on-boarding & learning plans to new employees

Speed OnBoarding

Succession Based Learning

Link learning activities to positions to succession plans for high-value employees

LMS Within Strategic HCM

Link learning plans to development goals for employees

Link Learning to Development

Facilitate dialogue with Forums for courses; use Wikis to push out pre-work; Blogs to share info

Improve Social / Informal Learning

Improve Talent Mobility

Tie learning plans to career paths employees wish to pursue

Assessment Results - A company can assess an employee using a competency gap analysis for the current or future position, self-assessment, 360-degree assessment or a comparison of actual to expected or targeted results. Using one or a combination of assessment results provides a full scope of employee efficacy in current tasks or readiness for a promotion. Knowing a workforces capabilities provides a variety of benefits. A company can plan to:

Develop the workforce further Ensure compliance on training Keep employees updated on newest product or service offerings Measure the efficacy of learning initiatives Make scheduling decisions according to position success Determine if and when new hires are necessary to fill gaps
Development Plans - Employees are an investment, and the faster they become productive, the faster the organization sees returns. However, constantly reinventing the training process for each new resource, or occupying experienced employees with training tasks and the associated evaluation, increases the initial investment. Balancing these dynamic expenses can be difficult. Therefore, an effective training program must be repeatable, systematic, targeted and measurable to appropriately address the issue.

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Definitive Guide to Strategic Human Capital Management 2009 State of Global Talent Management

Whether an employee is in the onboarding process, maintaining compliance or is being developed into a leadership role, knowledge of their competency gaps, track records and company best policies are the first step in generating a plan. Giving employees the chance to learn new skills is a large component in keep an engaged and motivated workforce, so taking advantage of a solution that help a company plan learning milestones will benefit the workforce and the bottom line.

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Plan and Schedule to Pay

Without visibility into its workforce, an organization cannot optimize its processes and schedules. In order to make the best possible decisions regarding employee scheduling, a manager must be able to easily access each employees details while building the schedule itself. With intelligent scheduling, the combined power of SumTotal Learning Management and Workforce Management allows managers to do just that; while creating or editing a schedule, managers can quickly pull the centralized employee profile to find the most appropriate match. By cross-checking employees certifications against the positions being scheduled, the application can prevent employees from being assigned to a role theyre not prepared for. These safeguards can be applied to the clock as well, preventing anyone without the proper certifications from punching in to an inappropriate position. For example, consider the manufacturing organization that experienced repeated instances of employees assigned to jobs they were not certified to complete; an inefficient and potentially unsafe situation. The advanced clock technology provided by SumTotal helped this organization ensure that unqualified employees are unable to punch into positions they cant complete, and SumTotals intelligent scheduling functionality prevents the employees from being scheduled to such tasks to begin with. Knowing your Workforce - Whether planned or unplanned, workers are going to be absent. Employees may need time off for illness, vacation, family care or even to pursue their studies on an extended leave. In the past, organizations with a high population of shift workers may have felt the impact of absences sooner and more directly than organizations with salaried workers, but in todays environment, where few resources are tasked with the work of many, worker productivity and business objectives have leveled that playing field. When employees are absent from work, organizations face increased risks related to regulatory compliance, workplace safety, staffing guidelines and business performance objects. Also, organizations that need to use overtime or temporary workers to maintain the same output will feel the effects of diminished margins. From a payroll perspective, there are costs associated with employee absence. For example, time entry adjustments may be necessary when an employee takes time off, and unless you have an automated solution, adjustments can lead to costly errors. With SumTotal Workforce Management, organizations can track employee schedules, work times and leave for accurate record keeping. Additionally, the system will track deviations from planned attendance, including such activities as
One of Europes most successful manufacturing companies, Howden set an aggressive business goal to double revenues. To support this goal, HR determined the company needed to retain and grow its engineering staff. The HR team presented a business case to executives to show that an integrated talent management solution could enable them to reduce turnover and achieve a strong return on investment. The plan focused on creating a single solution that would unify employee information in one place, creating a new hire training program and creating a career path program to help with succession efforts. The implementation of SumTotal Performance, Career Development, HRMS and Learning helped to improve time to competency for employees and reduced turnover costs for Howden. The SumTotal solutions ability to link together all the components of this program into one system, from new-hire information to scheduling, e-learning and diverse content management, really helped us execute this program across the globe successfully, said Global HR Operations Manager David Tough.

Fast Facts
Industry: Manufacturing Countries: 17 Countries Users: 3,800 SumTotal Product: SumTotal Performance SumTotal Career Development SumTotal HR Management (HRMS) SumTotal Learning

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Definitive Guide to Strategic Human Capital Management 2009 State of Global Talent Management

late arrivals, early departures or not working on a scheduled day. These features will grant managers the time and information they need to keep their workforce running and help solve issues by clarifying trends.

Analyst Reviews:

Closing the Loop

A company that plans to succeed in its goals must focus on activities and initiatives that support growth and promote the bottom line. While the thought is simple, knowing what these activities are is another matter, and being able to track correlation and show hard data on them is harder still. Using a Strategic Workforce Analytics solution to overlay the components that make up Strategic HCM allows a company to roll up the data into a high-level view of the health of the company, all the way down to a granular examination of initiatives or employees. In addition to seeing what is working well in a company, executives and managers using Strategic Workforce Analytics can pinpoint problems and discover low-impact competencies using a combination of internally generated key performance indicators and external data. Being able to compare common data on a single dimension instead of piecing the information together across siloed modules means information is more accurate and accessible for actionable decisions. Using a Strategic HCM solution like SumTotals means that a company has access to best-in-class products that create a clear picture of business health and an easy roadmap to follow when selecting, developing, motivating and managing a workforce. With penetration into more than 50 percent of Fortune 500 companies, SumTotal has the depth and breadth of expertise to help your company apply the benefits of Strategic HCM.
Strategic Workforce Analytics

the broadest and most mature application suite in strategic HCM specialist space.

SumTotal has established itself as the market share and mind share leader

It seems clear to me that the company certainly has a strong leadership team and a clear roadmap for going forward.

Performance Succession

Learning Scheduling Time & Attendance

Compensation

Recruiting & Hiring HR Management

Job Proles Social Collaboration Competency Management Talent Proles

Expense Payroll & Benets

Talent Portal

Employee Records Career Development

Strategic Human Capital Management

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Data Acquisition Devices

360 Feedback
Mobile Devices

Leave & Absencees

Most impressive was the continuity of roles across each of its applications its no easy feat to maintain such consistency. SumTotal is positioned to keep growing its portfolio and gain more customers thanks to its common application platform and architecture, which provide integration of applications, processes and informationIn fact only a few providers have this breadth and depth.

Definitive Guide to Strategic Human Capital Management

More Information
For additional information, send an email to connect@sumtotalsystems.com

About SumTotal
SumTotal Systems, Inc. is the global leader in strategic Human Capital Management (HCM) solutions that provide organizations with a new level of visibility to help make more informed business decisions and accelerate growth. Recognized by industry analysts as the most complete solution, SumTotal provides full employee lifecycle management, including a core system of record, from a single provider for improved business intelligence. The company offers customers of all sizes and industries the most flexibility and choice with multiple purchase, configuration, and deployment options. We have increased the performance of the worlds largest organizations including Sony Electronics (NYSE: SNE), AstraZeneca (NYSE: AZN [ADR]; London: AZN), Amway (KUL:AMWAY), Seagate (NYSE: STX), Dell (NASDAQ:DELL), and Google (NASDAQ:GOOG). For more information, or to request a demo, please call +1 (866) 768-6825 (US / Canada), +1 (352) 264-2800 (international) or visit www.sumtotalsystems.com

Corporate Headquarters
SumTotal Systems, Inc. 2850 NW 43rd Street Suite #200 Gainesville, FL 32606 USA Phone: +1 352 264 2800 Fax: +1 352 264 2801

EMEA
SumTotal Systems, UK 59-60 Thames Street Windsor, Berkshire United Kingdom, SL4 1TX Phone: +44 (0) 1753 211 900 Fax: +44 (0) 1753 211 901

APAC
SumTotal Systems India Pvt. Ltd. 7th Floor Maximus Towers Building 2B, Mind Space Raheja IT Park, Cyberabad Hyderabad, AP-500081, India Phone: +91 (0) 40 6695 0000 Fax: +91 (0) 40 2311 2727 2012 SumTotal Systems, Inc. All rights reserved. SumTotal, and the SumTotal logo, are registered trademarks or trademarks of SumTotal Systems, Inc. and/or its affiliates in the United States and/or other countries. Other names may be trademarks of their respective owners. 12_0210LS 12_0229NH

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