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Rewatch our CIPHR Connect partner Shopworks on CIPHR’s stand at the CIPD HR Software Show (filmed on 14 June 2018)
Discover how new cloud-based tools are allowing HR to work closer with finance departments to give companies a competitive edge whilst improving compliance and employee satisfaction.
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Hi. Just to introduce myself. I’m Ian Hogg. I’m the Chairman of ShopWorks and one of the founders. We’re a workforce management staff scheduling supplier. I’m not going to talk to you about the software or show you any of it. I just want to talk about some of the trends that we see in the marketplace that relate to both finance and HR. And the reason I think we’re reasonably well qualified to have an opinion on how these two departments are working together is because we are nearly always integrated into both the finance and the payroll software and the HR software. We do staff scheduling, we take a feed from HR of all the people, we work how much to pay them and we send that to both finance and to payroll.
So a lot of projects we’re involved in involve the HR and finance functions. And one of the reasons that sort of prompted me to, you know, to pick this subject for the speech is a recent report came out by an IT which was suggesting that lots of companies are looking at merging their HR and payroll departments. And when I read the report, I thought, actually I’ve seen that in action. We’ve got a couple of customers where the Head of Payroll now reports to the HR Director and we’re, you know, we’re, well, I’m in discussion with a couple of others where that is about to happen. In the past, that might have been a, you know, directly into finance. So when I read the report, I thought, “Yeah. That’s, you know, I’ve seen that happen,” you know. I believed in the report and I thought, “Well let’s try and explore some of the trends and explain them to the audience.” One thing probably worth explaining on us is we specialise in multisite retail leisure hospitalities, those sort of organisations. So we’re quite specialist but we’ve got customers with 4,000 venues, okay, and 40,000 staff. And in those departments, in those companies, there’s a bigger urge to put these departments together. Okay?
And the report suggested that the reason people are doing it is because they want better productivity. Now, you know, one of the things that, you know, if you look at the problem statement for this in the first place is and you have, why don’t they work together at all times? It’s because HR would say finance just see it as a cost, okay, and people are just a cost and they’re not an asset. Okay? And that has been, we have come across finance people that take that approach, I’m sure we all have. But what we find when we’re working with, you know, these really big implementation projects. When we’re working with these sort of customers, we find the best companies are where the team is multi-department, where there’s HR and finance working together to solve problems.
What I want to do is explore some of the trends that are driving this and maybe suggest some of the tools that you can use or that we’re seeing in use, not just the ones we’ve built, but other tools that people are coming together in these sort of projects. Okay. So there are two, for me, there are two big global trends that are driving this movement. The first one is that when a government wants to solve a problem, it just dumps it on business. So when they want to solve the social, you know, if they want to worry about immigration, fine, let’s get the companies to manage it. Let’s get them to manage the compliance. If they want to give everybody a pay rise or solve a pension problem, fine. Let’s just pass that through to the companies. Now, I’m not saying I disagree with all of that but it’s definitely a trend and I think we could probably all list dozens of examples where that has happened. Okay.
And then I think the other big trend that is affecting all companies is the war for talent. And what we see is, you know, we’re not scheduling people to work for Google or Apple, we’re scheduling people that work in coffee shops or casinos or leisure centers. But there’s still a war for talent on those people because the best barista gets the customers coming back time and time again. So those are the sort of global trends. And if we look at how that impacts on an HR and a finance department, HR in the companies we deal with are having more and more to deal with compliance. So it’s becoming a very heavy and, you know, some of these things have only come in the last couple of years, you know. Working time directive, national living wage, GDPR, immigration, 20 hours shifts for students with non-EU visas. All of these are now HR’s problem and, you know, it’s a challenge. And the big trends have driven these and there will be others that will come, I’m sure. Governments around the world are just plotting those right now.
And also, the cost per person per hour is going up. It is going up dramatically. So finance departments increasingly want to apply pressure to make sure that they only pay for the hours that are worked and they only want the hours worked that are absolutely necessary. They don’t want people standing around doing nothing. And finally, the cost of non-compliance here is quite, is getting bigger, okay? So, you know, if anybody works for Byron, I apologise but Byron Burger is one that I think is well known. It got fined for not complying with the non-EU citizen visa requirements. Even companies as big as John Lewis have been done for national living wage non-compliance. And GDPR, they’re talking about 5% of your global turnover if you get that wrong. So the cost of compliance and the PR implications are getting huge. So actually, there is, you know, these trends are, in our view, are driving people to come up with better solutions to try and avoid the problem. Okay?
If we look at a little brief look at what, how not to do it in our view is where the two departments are separate, okay? Where finance, you know, they’ve got 100% control over the spreadsheets and the money, they don’t share it with any other department. They dictate a sort of ivory tower finance. It’s not a good way to run a business and where we see that, you know, quite often we’re going to companies and we’re helping them come away from that position to something that’s a bit more collaborative with HR. Likewise, the flip side of that, we’ve all come across HR, people that are just a little bit too focused on the soft factors and actually need to get a bit more real about the cost and the return on investment.
I’m sure we’ve all worked in companies and seen companies where, you know, those are the two positions or the starting positions of HR and finance. Okay. But what we think is the solution is that HR and finance work together to come up with a set of tools and set of processes that can solve all of these compliance and cost issues, okay? And you do need tools. There were just too many checks that need to be done. So if you’ve got, you know, we’ve got customers that are running 20,000 shifts a day. Each one of those shifts needs to be checked that it’s work and time directive compliant. All those staff need to be checked for national living wage. It’s too much to do manually. So you need tools to do it. And what we’re finding now and this is the sales pitch bit and we firmly believe in this and it is why we’re partners with CIPHR,is there are lots of specialist cloud-based high quality tech firms that all together can build you a solution that will meet all of your requirements. So we are partnered with CIPHR for HR, we don’t do HR. What we do is staff scheduling very well, okay, but we don’t do payroll. We go to people who are good at that and we don’t do accounting packages.
And so we think that the future is that HR and payroll need to work together, choose the best products that are available for their market, that might not be ours because you might not be in the market we cover, make sure those products have worked together before, test them out, and actually these are cheaper, in our view, cheaper, more reliable than going to what we would have, a bit like the big old, I won’t mention them, but the really huge mega software companies that do everything, okay? I didn’t mention that name. It would have been top of my list, though, sir. And what we also find is where it works best is if it’s led from one department, either HR or finance, in our view. It’s not quite doomed to fail, but it is doomed to be very painful and uncomfortable for us as a supplier, okay? So we much prefer it where you’re going in and HR and finance are working together, it’s a team project and it’s got buy-in from the top. And then these problems, you know, they, people will find the right tools and solve the problems.
And just to give you some sort of examples of the sort of stuff I’m talking about. So I’m not going to give you a ShopWorks pitch but just to put it into perspective, you know, we make a tool that’s web-based. They call it, it’s workforce management, people can create their rotas online, it’s got time and attendance built in it, it will check every rota before it’s approved for every compliance factor you’d want. It will check whether a lifeguard is in date for lifeguard training before they can be shifted in as a lifeguard. It’ll check the whole cost of that rota against budget and it won’t let people sign off if it was against budget. The finance guys like that, the compliance guys like the sort of, the compliance checks, okay, and the more traditional HR like the fact that actually, people know where they stand, it’s transparent and staff like it.
But we only do that one small sector. So we would normally integrate with a self-service HR platform like CIPHR and they would do all of the onboarding, the staff retention and we would normally be fully integrated into that where staff have only had one portal to access, they can see our data through the HR portal, okay. Where they’re doing other stuff that is none of our business but, you know, that is improving the retention and again, which finance are getting more and more interested in retaining staff. They’ve worked out a cost of replacing them. And right-to-work tools. We do a lot of work with people that, like, different right-to-work tools that are checking databases to see who is, you know, who’s got the right to work in the UK and these are just a few of the examples. There are lots of different tools. But probably, the one that joins it all together is nowadays, you know, data about staff using business intelligence tools is a big thing and we partner with a number of different suppliers. We put in our data, they take HR data, they’ll take in the transactional data from tills and they can really analyze how well that business is running. Okay.
And what’s the benefits? Well, you know, hopefully, greater retention. That’s, you know, once you’ve got good people, you get good people and keep them. Okay. Full compliance. I mean, now, compliance for us is, it’s a high G factor. You just can’t afford not to do it. Once it’s right, you shouldn’t have to worry about it. It should just be automated, okay, it should just all happen. But what we are quite good at is just making sure that there’s no overspend on budgets, that, you know, we’re only employing people for the hours we actually need worked and we’re only paying for those hours and we’re not overspending, and that’s a big driver for the finance department. But it’s all the same product. It’s all the same project and set of tools. And then I think the, an understated benefit is that actually, if you go through a project like this as a company, put all the right tools and processes in place, you will save management time in the long run.
You certainly won’t in the short term, but in the long term, you will and that management time can be used for much better aims, to actually think of strategies to make sure you retain, attract and develop staff. That’s it. Any questions?