Getting in Synch: Transforming HR to Support Business Strategy at a Leading Indian Manufacturer

Client prole
The client is one of Indias largest cement and ready-mix concrete manufacturers, with a network of 14 plants, 20 sales units, and 10,000 employees.
Business challenge
Leading companies never stand still. As a case in point, this top Indian manufacturer had staked its continued success on a number of strategic imperatives, including aggressively capturing new market share, building and capitalizing on new capacity, and becoming a leader in qualityall while continuing to keeping control of costs. Achieving these goals would require a signicant contribution from the companys people. In fact, the company had identied complementary human capital imperatives it viewed as essential to supporting the companys growth agenda. These included attracting and retaining the right people, in sufcient number, to run the companys expanded operations; building a strong performance mindset aligned to the rms vision; breaking down organizational silos to create a more responsive and transparent culture; developing aligned and effective leadership (including middle management); and inculcating a people developer mindset among line managers. This was a tall order, particularly given the companys existing HR capabilities. Despite signicant investments in technology and people, the current HR function was not well-aligned with the companys pursuit of growth and high performance. For example, HR was overly hierarchical and had many layers of bureaucracy, which kept it from recruiting, promoting, and re-assigning employees effectively. Such challenges meant that the companys engineits workforcewas not pulling it in the right direction or at the right pace. In light of Accentures deep experience in HR transformations and with the challenges of the manufacturing sector in India, the company approached Accenture for help in creating an HR function that could help the larger enterprise achieve its growth and other strategic goals.

How Accenture helped

to support its business objectives, were creating challenges for the Accenture worked with the workforce. For instance, among the company to lay the foundation management ranks, new employees for more powerful HR capabilities were having difculty acclimating that would support the companys to the company while those who pursuit of growth and sustainable had been with the organization high performance. Accenture for a few years felt they didnt and the company determined have a clear career path. Managers key elements of this foundation who had been with the company would include a comprehensive HR for a longer period of time were strategy aligned with the business having difculty seeing how recent strategy, a revised HR service organizational changes were delivery model, and a strengthened contributing to the big picture. HR governance and organizational At the skilled labor level, workers structure. Together, these advances struggled with, among other issues, would help the company to tighten perceived lack of recognition of the alignment between HR and the their effort, insufcient learning business, as well as make lasting and development opportunities, performance improvements among and little communication from key line managers, their employees, management. Together, these and the business units for which assessment ndings provided they worked. essential guidance to the project team as it formulated a more One of the rst steps in this powerful HR strategy. direction was an assessment to identify specic HR processes Accenture also helped the company that did not support business improve the way it delivered HR goals or fell short of global services, with the goal of boosting leading practices. This HR process efciency, effectiveness, and the assessment involved workshops functions support of growth. attended by stakeholders from To identify potential areas for both the HR function and from improvement, Accenture conducted the overall business. It also used a time distribution survey, which the Accenture Human Capital revealed that HR employees spent Development Framework, which the majority of their time56 draws on leading practices and percenton administrative, legal Accenture experience to help and security issues, 19 percent organizations to assess their core on executing transactions, and human capital capabilities, identify 21 percent on processes and the human capital processes that engagementleaving only 5 will likely improve them, and percent to be dedicated to the prescribe the specic process more strategic activities that interventions that will yield would support growth. great results. With the assessment clearly Accentures assessment revealed illustrating the company needed that key improvements could more time and resources spent be made in learning, training, on growth-oriented projects, performance management Accenture identied specic HR and leadership development. processes that could be outsourced In particular, Accenture found to a shared services center and that changes the company was built a detailed business case for making in the way work is done, this transition. Processes that

were not tightly integrated with other processes, that were highly standardized and rules-based, and that were stable and only required low to medium skill levels were deemed ready for the shared services model. In fact, 44 percent of HR activities met this criteria, including organization change, talent architecture, recruitment, performance management, compensation and benets, and many others. Due to the large number of processes to be transferred to the shared services center, Accenture designed a multiphase transition that would minimize disruption and risk. The transition also would create substantial value: Accenture estimated that over ve years, the shared services center would generate roughly $14 million in savings, plus greater scalability, higher service quality and customer satisfaction, and faster process cycles. To bring about these benets, Accenture laid out a detailed implementation plan that encompassed the design, building, testing, and deployment of critical technology, organizational structures, and communication and training activities. To determine optimal headcount levels, Accenture considered the number of company employees requiring HR services, the volume of transactions to be processed, and relevant industry benchmarks. A revised organizational structure and governance framework also were key to unlocking the power of the companys new approach to HR. For example, going forward HR would utilize three levels of reviewa joint review board, an advisory team, and a user committeewhen making decisions related either to its strategic direction or to the resolution of any issues, thus

ensuring long-term alignment with business strategy. The new structure also included HR centers of excellence (COEs) to gather and fortify the companys deepest HR knowledge, and the identication of HR business allies to monitor tight alignment between HR and the business. Accenture worked closely with the company to establish clear roles and responsibilities for the COEs, business allies, line managers, and the shared services center in the critical areas of recruitment, training, and performance management. In recruitment, for instance, the COEs would determine the screening methodology, while the shared services center handled initial screening, pre-employment checks, offer nalization, and management of the talent pool. Business allies and line managers were responsible for interviewing and selecting candidates. Accenture established clear accountabilities such as these for all aspects of recruitment, from planning and sourcing, through screening and interviewing, to on-boarding and measuring results. Likewise, the project team laid out roles and responsibilities for trainingfrom assessing training needs to measuring its resultsand for performance management. Across each of these areas, the HR business allies played a critical part, monitoring close alignment between HR and the business. The COEs contributed powerful experience and ideas, while line managers conrmed effective implementation of HR processes and the shared services centers provided fast, high-quality, cost-effective administrative support. Overall, the governance and organizational structures Accenture put in place helped

conrm that all the moving parts comprising the companys HR function would run like a welloiled machine. With this stronger, betterconnected HR engine in place, Accenture and the company set their sights on using it to improve the skills and engagement levels of key line managers, and thus enhance the performance of critical business units. Indeed, Accentures analysis revealed that engagement levels among line managers and their employees were alarmingly lowa condition that would not foster strong, sustainable growth. Furthermore, Accenture found that line managers were not taking responsibility for nominating their reports for training and learning programs that would help the company achieve its growth goals, or for identifying promising talent and nurturing its development. Neither were line managers using the companys performance management system to its fullest extent. In short, to derive a better return on its HR investments, the company would have to transform the ways in which these managers did their jobs, particularly with regard to human capital. Accenture began with two of the companys two lowest-performing units, a sales unit and a cement plant. To understand why these units had such low engagement levels, Accenture surveyed their line managers along three dimensions: their comprehension of people development, their ability to identify and develop talent, and their capacity to mentor their reports and foster better performance.

This survey revealed that the largest problem was comprehension: Line managers lacked a clear idea of what people development involved, or what it required from them. Thus, Accenture embarked on a multi-step journey to boost comprehension, working with these managers to improve communication with their employees and bolster their knowledge of what motivated their reports and could improve performance levels. Accenture facilitated a simple, structured dialogue between managers and employees, thus opening up channels of communication and improving engagement levels in both business units. Accenture subsequently helped the company identify the specic competencies and capability levels required for higher performance levels in key roles, including sales, marketing, production, and maintenance. With this knowledge in hand, managers and employees worked with Accenture to establish improvement targets customized to specic jobs and career paths, and aligned with the companys pursuit of aggressive growth. Accenture also help the company identify employees who were performing at exceptionally high competency levels, and creating customized career paths for such employees. In some cases this involved horizontal movement, particularly when an employee possessed exceptional skills in areas not directly related to his current job. The companys new approach to HR also veried that rising stars would gain the crossfunctional experience they needed to one day play a leadership role.

Conversely, the new transparency into employee competencies also allowed the company to identify underperformers and design customized strategies to optimize their contributions to ongoing growth and business performance. These strategies included a wide range of interventions, including action learning projects, training academies, and coaching programs. Regardless of the vehicle, the goal was the same: Make sure all employees are pulling in the same direction and are driving the company toward growth and high performance.

For this manufacturer, Accenture has helped put in place an HR strategyas well as HR skills, processes and capabilitiesthat can help make this goal a reality. The companys new approach to HR not only boosts alignment between the function and the business, but also allows line managers to utilize optimized HR processes and make people development a critical aspect of their jobs. This, in turn, allows the company to deploy its best people against its most compelling growth opportunities, and shore up areas in which its performance lags. For example, the sales unit on which the project team had focused during the transformation has since gone from one of the lowest performers in the company to one of the best.

With better methods in place to unlock the value of its human capital, the company now is in a much stronger position to pursue growth and market share while maintaining the cost control and quality levels required for longterm success. In short, Accenture has helped this company transform HR into a strategic ally to the business and has made the function a key player in the drive toward high performance.

High performance delivered

As the engine of any successful organization, human resources must run at full power and in proper alignment with business strategy for growth and high performance to be attainable.

About Accenture
Accenture is a global management consulting, technology services and outsourcing company, with 257,000 people serving clients in more than 120 countries. Combining unparalleled experience, comprehensive capabilities across all industries and business functions, and extensive research on the worlds most successful

companies, Accenture collaborates with clients to help them become high-performance businesses and governments. The company generated net revenues of US$27.9 billion for the scal year ended Aug. 31, 2012.

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