Electronic Business: Concepts, Methodologies, Tools, and Applications (4-Volumes) P102 ppsx

944 A Survey of Competency Management Software Information Systems • Integration with other related ERP pro- cesses. • Automated mail service activities required to manage training courses. EMPLOYEE’S CAREER DEVELOPMENT This process creates a roadmap for success, de- termining future development activities. With CM, focus is made on high-potential employees and leadership-oriented careers. Figure 8 shows internal and external process relationships. Best practices key process indicators:  (PSOR\HH¶VGHYHORSPHQWSODQV GH¿QHG LQ HR or global corporate ERP. • Individual development initiatives managed from ERP results registry . • HR ERP integration with other relevant processes. • Employee’s potential and preferences reg - istered in ERP. PERFORMANCE MANAGEMENT Associated to any CM strategy, organizations require employees’ daily execution to be aligned to corporate strategy, committed to achieve mea- surable business results. HR focus is on skills tracking, targeting leadership and high-potential employees. It includes skills and competency personal assessment, and, sometimes, 360-degree type of evaluations and feedback. Best practices key process indicators:  (YDOXDWLRQGH¿QLWLRQDQGUHVXOWVUHJLVWU\ GH¿QHGLQ+5RUJOREDOFRUSRUDWH(53 • Individual self-evaluation made via ESS DQGZRUNÀRZEDVHGDSSURYDOSURFHVV • Integration with other relevant ERP mod - ules. ET_01 Create Training Plan ET_02 Ident. Ed. Requir. ET_03 Asses&Aprov.TP ET_06 Employees sign on ET_05 Select T.Providers ET_04 Courses Definition ET_08 Train Employees ET_07 Training Call EMPLOYEES DEVELOPMENT EVALUATION COMPETENCIES E_LEARNING ESS TRAINING TECH/CORP.REQ. ET_10 Update E.Record ET_09 Evaluate Training ADMIN. CCM & PROCUREMENT Figure 13. Internal and external process relationships 945 A Survey of Competency Management Software Information Systems COMPENSATION AND INCENTIVE MANAGEMENT &RPSHQVDWLRQ LV FULWLFDO WR ¿[ DGHTXDWH ZDJH structures within the organization. Incentive management is required to manage employees’ YDULDEOHUHWULEXWLRQDQGEHQH¿WV&RPSOH[LW\YDU- LHVDFFRUGLQJWRH[WHQWDQGW\SHRIEHQH¿WVSHQ- sion plans, private medical services, insurances, etc.). Usually third-party required information tracking and reports are used. Best practices key process indicators: • ERP-based variable retribution, calculated for employee evaluation. • ERP-based market salary survey. Market Applications: The CM Contribution HCMS is considered today a mature market for the IT industry. Although the administrative, transaction-based type of applications have very limited growth potential (only outsourcing, hosted services in small and medium size business), the strategic talent management-type of applications, driven primarily by competency management business interest, is on the rise. Similarly to other enterprise-wide applications, where process integration becomes essential, the vast majority of medium to large organizations are now automating HC process in one out of three products: SAP, PeopleSoft, or Oracle, and WZRFRPSDQLHVEHFDXVH2UDFOH¿QDOO\DFTXLUHG PeopleSoft during 2005. Around 40% of the Table 8. Process reference model for employee’s career development Activity Name Description CD_01 Career development plan design Based upon employee’s potential and strategic HR CM development objectives (includes target employees segment, criteria to identify potential, application period, etc.). Succession SODQQLQJLQIRUPDWLRQLV¿OWHUHG CD_02 Employee potential analysis Following actions are taken: ,GHQWLI\HPSOR\HHVPDWFKLQJSUR¿OH employee appraisal. CD_03 Employee’s potential inventory Update HR master employee data with employee’s information to ensure that opportunities are considered: job vacancy opportunities, special task assignments, and so forth. CD_04 Generate personalized development plans Individual career plans for competency development. Usually based upon employee performance evaluation, training opportunities, special task assignments, etc. CD_05 Development’s plan appraisal 3HULRGLFFKHFNVWRFRQ¿UPVXLWDELOLW\DQGFRPSOLDQFHWR organization’s business objectives. 946 A Survey of Competency Management Software Information Systems worldwide HCM market is concentrated in these two companies. This merger and acquisition wave is not an isolated exception (Adonix acquired Meta4, Cy- ERUJPHUJHGZLWK +5 6HUYLFHV ,Q¿QLXPZLWK SSA, etc.). Microsoft (the world’s leading IT corporation but still not an important player in HCMS) and SAP announced merging conversa- tions last year. Best-of-breed products’ previous business preferences are now swiftly moving to the ERP (trough acquisitions). Market fragmentation in HC management is therefore ending, and many small, single-function-oriented products are being CD_01 Prog.Dev.Design CD_02 Potential Analysis CD_03 Potential Inventory CD_05 Plan Appraisal CD_04 Indiv.Dev.Plan EVALUATION LEARNING HR ORGANIZATION COMPETENCIES RECRUIT & SUCCESSION PL ANNI NG Figure 14. Internal and external process relationships Table 9. Process reference model for employee’s performance management Activity Name Description EV_01 Competencies and business objectives GH¿QLWLRQ Frequently mix of global, business unit, and personal objectives plus competencies and shared values. EV_02 Self-evaluation According to person’s perceived achievement. EV_03 Formal evaluation Performed by management, and employee agrees. EV_04 Formal approval HR validates and ensures organization’s coherence. EV_05 Results analysis Information is obtained to shape next period’s educational UHTXLUHPHQWVDQGDVVLJQVYDULDEOHEHQH¿WV 947 A Survey of Competency Management Software Information Systems EV_01 Stablish Obj&Competencies EV_02 Self-evaluation EV_03 Formal evaluation EV_04 Eval.Analysis COMPETENCIES COMPENSATION EVALUATION TRAINING ESS HR OK ? Y N Figure 15. Internal and external process relationships Table 10. Process reference model for employee’s compensation and incentive management Activity Name Description CO_01 Compensation plan Plan is established according to strategic retribution policy, considering internal and market reference information. CO_02 Evaluation results analysis Competency development and business objectives and accomplishments are evaluated. CO_03 Compensation schema elaboration and review Based upon results and time schedule to be applied to individuals. HR approves and submit schema for approval. CO_04 Management approval 0DQDJHPHQWERDUGDSSURYHV¿QDOSODQ Figure 16. Internal and external process relationships CO_01 Compensation Plan CO_02 Anal. Ev Results CO_03 Comp.Schema CO_04 Managt. Approval PAYROLL HR EVALUATION Market Survey Int. references 948 A Survey of Competency Management Software Information Systems incorporated in ERP suites or just disappearing. Maybe the LMS market is the exception to the rule, with an approximately 15% growth expecta- tion in a $450M world market (2005). ,W L V T X L W H G L I ¿F X OW W R T X D Q W L I \ Z K LF K S H U F H Q W D J H  of the global HCMS market corresponds just to CM processes. Most organizations enter ERP- based solutions (acquiring licences), automating just part of the functionality. Usually, deployment corresponds to most critical business functional- ity, with limited CM process automation. Com- panies invest in ERP suite licences and deploy IXQFWLRQDOLW\RYHUWKH\HDUVZLWKWKHFRQ¿GHQFH that the ERP vendor will ensure a long process integration. Worldwide HRMS and payroll administration UHYHQXHVLQUHDFKHGDURXQG0GH¼ with an estimated growth rate for 2005 of 7%. About 30% of the revenue corresponds to payroll and 70% to HR management processes. This survey assumes that, although not all product licences are devoted to comprehensive compe- Figure 17. Best practice cost distribution for competency management Consult 33% Internal 29% SW 22% HW 16% Concept % Ratio Consultancy & Engineering 33% 1,50 Product Licences 22% 1,00 Hardware 16% 0,73 Figure 18. OS Environments in CM Implementations (2005) 33% 43% 4% 8% 2% 10% Unix Windows OS/400 Main Frame Linux Others 949 A Survey of Competency Management Software Information Systems tency management deployment strategies, about 40% ($ 1,300 M) is the market size for HC direct CM-related process. 7KHHVWLPDWHG¿JXUHVUHSRUWHGLQWKLVVWXG\ refer only to product licence fees and mainte- nance costs. Consultancy and implementation engineering costs are not included. In order to obtain overall comprehensive IT-related cost distribution statistics, the following experience- based statistics method may be applied: Figure 17 shows current OS environment usage for CM-related solutions. Trends indicate DVLJQL¿FDQW LQFUHDVH RIWindows 32 and 64b. and reductions in AS400, others, and mainframe environments. Figure 18 shows that, for each Euro spent in the software product licence, 1.5 Euros are spent on consultancy and engineering services and 0.73 Euros in hardware. Technical Architecture Reference Characteristics The next point in this survey shows a generic evaluation model used to asses IT and HR business specialists in selecting the most adequate technol- ogy to deploy a competency management strategy in any medium- to large-size organization. As we will see later on, the product’s technical architec- ture is an important issue in this process. This section depicts the technical architecture to be considered as a reference in CM strategy deployments. :KLFKDUHWKHUHOHYDQWDVSHFWVGH¿QHDJRRG (or poor) technical architecture?  4XLFNO\DQGÀH[LEO\ • Facilitating the introduction of new perfor - mance and scalability mechanisms. • In a true multi-tiered approach, using com - prehensive standards-based interfaces: The client side is basically a user terminal (Web browser, PDA, etc.). Technologies: HTML, JavaScript, WML, Servlets, JSP, and so forth. The Server side consist on the Server elements, as a Web or WAP Server, that send information to the User Terminal. The business logic is the core application intelligence that makes the CM logic possible (application server with Java support, EJBs, servlets, etc.). Data Logic is responsible for data storage and transactional services (DBMS, etc.). Enhancing SW reusability and development skills specialisation, using component-based software. Competency Management Market Products Product solutions vendors that automate CM processes fall in one of these four categories: • Large integrated ERP suites: These vendors dominate the high-end HCMS market; also competitive in SME Markets. Organizations select these solutions usually to automate more than one corporate business processes LQWKHDUHDVRI¿QDQFLDOV&50+&PDQDJH- ment, e-procurement, etc.). Even recognising that these vendors do not always deliver the best solution for any given particular func- tion, their value proposition is founded on process integration and proven, reliable comprehensive process automation. Most market CM strategy deployment demand comes from large-size organizations to an extent that in the coming years, CM may be considered the most relevant business driver that will facilitate HCM market growth. • SME integrated ERP suites: Similar func- tional s c o p e t o p r e v i o u s h i g h - e n d E R P s w i t h simpler parametrization options, much faster to deploy, tailored to SME-type organiza- tions. • Standalone HCMS: Large- and SME-driven solutions from vendors exclusively dedicated 950 A Survey of Competency Management Software Information Systems to payroll & HCMS, not providing support for other corporate business processes (as V X S S O \ F K D L Q P D Q D J H P H Q W  & 5 0  ¿ Q D Q F L D O V   etc). • Standalone CM solutions: They automate CM processes, sometimes in combination with performance management and eventu- ally providing support for some other related CM process, in a non-comprehensive, inte- grated way. The following part of this chapter shows for each CM product-type category previously indi- cated, IT- and business-relevant vendor informa- tion, evaluating their product offering according to the next proposed evaluation method. Some Mobile Employee Connected Employee Thin Client Handheld Client Intranet/Internet Intranet/Internet Wireless Client CM Application Employee DB Figure 19. Deliver comprehensive e-business functionality, across and between multiple channels Figure 20. CM development architecture Business Logic (Legacy Systems) Presentation (Client Side) Presentation (Server Side) Business Logic (Web Technologies) Data Logic 951 A Survey of Competency Management Software Information Systems additional markets are based on four evaluation criteria, as indicated hereafter: CONCLUSIONS AND OUTLOOK Following are the most relevant market conclu- sions and outlook uncovered in this survey: • HCM and CM application market scope is strong, clearly on the rise. Organizations have to adapt fast to changing, unstable business conditions in a way that CM paper and spreadsheet manual-based processes ZLOOKDYHWRHYROYHWRDPXFKPRUHÀH[LEOH automated employee management-type practice. • Market preference for ERP-integrated CM solutions instead of best-of-breed standalone products will continue in the future. ERP integr ation ensures that HR and business P D Q D J H U V F D Q H I ¿ F L H Q W O \ D O LJ Q  P H D V X U H  D Q G  Evaluation Criteria Key Factors Description COMPANY Financial stability strategy and vision Partners and alliances Research and development Professional services Vendors with high potential to survive in the IT market and strong product maintenance and support are highly rated. MARKET PRESENCE Product current and previous versions References CM functionality references Evaluate product stability, installed base and market credentials in previous implementations. FUNCTIONALITY &RPSHWHQFLHVGH¿QLWLRQ Competencies diagnosis Competencies development Competencies monitoring Rest of CM-, HC-related processes Matching of vendor product standard functionality vs. organizational requirements in FXUUHQWQHHGVDQGH[SHFWHGUHTXLUHGVXSSRUWLQ the future. PRODUCT TECHNOLOGY Technical architecture E-business support )OH[LELOLW\ Integration facilities with required organizations Applications Security compliance Although e-business engineering practices are widely used, product architecture, scalability, DQGFRQ¿JXUDWLRQUHPDLQDQLPSRUWDQW differentiator. Table 11. 952 A Survey of Competency Management Software Information Systems Evaluation Criteria Considerations COMPANY SAP AG (Waldorf, Germany) is the world’s third-largest independent SW company, devoted to enterprise management, and is the world’s leading ERP vendor. More than 28,000 clients, 1,500 partners, and 34,000 employees with local support in more than 50 countries. World’s OHDGLQJYHQGRULQFRPELQHGDGPLQLVWUDWLRQDQG+&PDQDJHPHQWZLWKD0¼\HDU UHYHQXHVHFRQGLQ+&PDQDJHPHQW0¼FORVHEHKLQG3HRSOH6RIWDOWKRXJK No. 1 in Europe. MARKET PRESENCE 6$3VWDUWHGLQWKHVZLWKWKH¿UVWPDUNHWSURGXFWWRDXWRPDWH¿QDQFLDODSSOLFDWLRQV 5(YROXWLRQIURPWKH¿UVW5LQVWDOODWLRQVWRWKHSUHVHQW¶VFRPSUHKHQVLYHFRUSRUDWH SURFHVVHV¿QDQFLDOV+&06&506&0HSURFXUHPHQWEXVLQHVVZDUHKRXVHSRUWDOV etc.), applications under R/3, in which HC and CM solutions are integrated, is a history of sound evolution, incorporating worldwide process excellence and real customer migration support in an all-new product version (currently, once a year). FUNCTIONALITY $OO&0UHODWHGSURFHVVHVLGHQWL¿HGLQWKLVVXUYH\DUHLQFOXGHGLQWKHLQWHJUDWHG6$35 Solution. Its international focus has ensured extensive local regulatory worldwide support for administrative functions (i.e., payroll). Some processes remain rigid to implement FRPSHQVDWLRQEHQH¿WVFRPSDUHGZLWKEHVWRIEUHHGVROXWLRQVEXWRYHUDOO&0DVVRFLDWHG functionality rating is very good. PRODUCT TECHNOLOGY SAP NetWeaver’s architectural design comes from a rigid client-server Model, supported on a vendor’s proprietary environment (ABAP). Product evolution in the last three years offers a reasonable Java support and interoperability with .NET and IBM WebSphere (J2EE). Development, deployment and execution environments run on its own SAP Web Application Server (WAS), providing combined ABAP, J2EE, and Web services support. Table 12. Large integrated ERP suites software products SAP AG 953 A Survey of Competency Management Software Information Systems PeopleSoft Evaluation Criteria Considerations COMPANY Acquired by Oracle in 2005, world’s second-largest independent SW company (See Oracle, next company). MARKET PRESENCE PeopleSoft’s roots within the enterprise management business are in HR, then extended WR¿QDQFLDOV6&0&50DQGHFRPPHUFHDSSOLFDWLRQV/HDGHULQWKH86IDUEHKLQGLQ European sales due to SAP’s dominance and lateness in incorporating country-required regulations in HHRR administrative and payroll processes in some countries. )81&7,21$/,7< PeopleSoft Enterprise suite represents the most advanced, integrated process automation solution for HC management on the market/DVWSURGXFWYHUVLRQVKDYHLQWURGXFHG HQKDQFHPHQWVLQ&0PDQDJHPHQWDQGZRUNIRUFHDQDO\WLFVLQWHJUDWLQJ¿QDQFLDOWUDQVDFWLRQDO HR, and external market data to provide strategic performance management. Workforce rewards manages compensation and retention policies. PeopleSoft’s own Balance Scorecard is effectively used to manage HR effectiveness under workforce scorecard module. 352'8&77(&+12/2*< 3HRSOH6RIWDUFKLWHFWXUHLVDYHU\ÀH[LEOHFRPELQDWLRQRIGDWDEDVHDSSOLFDWLRQ:HEDQG¿OH Server, fully e-business compliant. The PeopleTools Application Server runs the business ORJLFDQGIDFLOLWDWHVDFFHVVWRPRVWFOLHQWW\SHVXVLQJWKH,QWHUQHWDUFKLWHFWXUHDQGDOORZLQJ interfaces to visual basic-visual C-based user programs. Table 12. Continued . stability strategy and vision Partners and alliances Research and development Professional services Vendors with high potential to survive in the IT market and strong product maintenance and support. 32 and 64b. and reductions in AS400, others, and mainframe environments. Figure 18 shows that, for each Euro spent in the software product licence, 1.5 Euros are spent on consultancy and. tracking, targeting leadership and high-potential employees. It includes skills and competency personal assessment, and, sometimes, 360-degree type of evaluations and feedback. Best practices