Soft Skills

Human capital management simplified

The Park Hotels has streamlined its HR processes and payroll management and has increased employee productivity using SAP HCM. By Akhtar Pasha

Photo courtesy: Apeejay Institute Hospitality

The Park Hotels has served corporate and leisure travellers from India and abroad for 40 years now. Apeejay Surrendra Hotels opened its first 150-room property in Kolkata in 1967 and over the years has set up premium boutique hotels in Bangalore, Chennai, New Delhi, Navi Mumbai and Visakhapatnam.

The company uses SAP Human Capital Management (SAP HCM) to effectively manage human resources and payroll for over 1,800 people. This enables employees to make the most of their time while helping the chain to make the most of its employees' talents by using features for assessing performance and training management. The solution also enables the company to operate more effectively and use its resources in a strategic manner. Currently, SAP HCM runs live at its Bangalore, Chennai, New Delhi, Navi Mumbai and Visakhapatnam properties. It intends to acquire a property and build a plush boutique hotel in Hyderabad as well.

Handling diverse skill sets

A business hotel employs staff with diverse skill set, from butlers to chefs to top business executives. According to Vijay Dewan, managing director of The Park Hotels, with six regions and 1,800-plus employees, managing operations through manual systems was taxing. "HR people used to simply call up six regions and do a one-on-one meeting for performance evaluation. These manual procedures required the HR department to follow up with regions to draw up strategies, develop career programmes, and decide on promotions and incentives. To make things worse, data regarding these functions was not available for the HR department to streamline processes. As a result, the entire performance evaluation cycle took a month to compile and that created a bottleneck to growth," he says.

Moreover, The Park Hotels rulebook for employees-vision, objectives, dos and don'ts - were all in a manual format and were not integrated. The manuals differed from region to region.

Slow payroll processing and decision making

Although the rules and regulations applied to all employees, there were differences in certain clauses-say two identical grades had a different compensation structure in different regions. This kind of disparity created confusion. Dewan says, "Employees used to swipe cards for check-ins and the data was recorded locally. During payroll processing, the same information had to be downloaded and checked manually to get a fix on the number of days that the employees attended work as well as to generate the leave and late reports."

Additionally, it was difficult to get information like how many employees were there in the first shift in the 9:30 am batch. Monitoring a single employee across payroll activity was a time-consuming task. HR used to spend five days to process payroll hurriedly looking into accumulated data and leave attendance which at times failed to match." The DOS application used for payroll had limitations and did not meet the company's requirements. Dewan says, "It was difficult to arrive at HR cost and make strategies with regard to payroll costs, training and career development planning."

Evaluation and selection

When the time came to select HR software to manage employee data, The Park Hotels went through a rigorous evaluation process. Dewan added, "It came down to Ramco, SAP and PeopleSoft. SAP was the clear winner because of its experience in diverse verticals and a global platform. We evaluated vendors in 2006 and towards September 2006 we signed up for SAP ECC HCM 5.0 (Human Capital Management)." The HCM was implemented in all regions simultaneously and went live in June 2007. The modules that were selected for deployed were Personal Administration, Time Management, Payroll and Employee Self Service (ESS).

Once the SAP HCM implementation was underway, The Park Hotels began taking advantage of the internet-powered solution's capabilities such as employee self-service (ESS). "It has been a great experience," says Dewan, adding, "Our employees now enjoy broad access to their data through ESS and can change their information-they have become stewards of their personal information." For example the entire process for leave sanctioning has been reduced from two days to one and the process is online. Additionally employees can access their personal data such as salary slips, Form 16 or change in the address or marital status and the like.

With SAP HCM, employees at The Park Hotels now have access to comprehensive information. This makes it easier for them to make informed decisions and gives them a greater sense of autonomy. "Online access to broader, more accurate information supports an employee's decisions-regarding benefits selections, for example-in a faster, more effective way than before," said Dewan.

Additionally, it has helped the HR team focus upon what it does best. "They can bring greater value to the job and have a greater impact, rather than spend time on transactional and administrative tasks. Processing the payroll that took almost five days is now done online." After the cut-off date for payroll processing, the SAP system processes the payroll looking at previous data and gives out a dummy result to the payroll representative and once it is okayed, the pay slips are generated. There is centralised control of payroll processing.

Better career planning

The company uses SAP HCM to ensure that its employees are making the most of their talents and that they are placed where they can bring the maximum value. "With SAP HCM, we can collect information about employees' relative performance and career potential, and then consolidate centrally," said Dewan.

"Earlier, we had no way of bringing this information to the table in a controlled and consolidated way. Now, we can identify talent pools, perform analyses, and make better, quicker, more thoughtful decisions about the deployment of employees. It has been a real advantage to the company to have that capability," he added.

Prior to the SAP HCM deployment, assessing employee performance was done differently in different regions, which would take a month. This has reduced to less than a week and it is done online now bringing about real savings in terms of time. "By having a standard processes, you begin to get consistency, and it's easier to understand the development needs on an individual and collective basis," he adds.

At The Park Hotels, the SAP HCM has had an impact upon a number of critical processes. Dewan cited compensation planning as a primary example. "Before SAP HCM was implemented, a lot of time was spent consolidating those numbers. Now, we have a global system and a consistent compensation planning process that allows us to provide accurate strategic decision support. We can do that more quickly, efficiently and accurately than before with SAP HCM compensation management."

All in all, having an integrated HR system has added value to the company. "Having a single system, streamlining our processes, and gaining some consistency of process-all of which help reduce mistakes and increase productivity-translate into a reduction in costs," says Dewan.

"We captured a tremendous amount of savings and value as a result of putting everything on a single system," he adds. The cost of the implementation of SAP HCM including the license fees, training, implementation and hardware and software is estimated to be Rs 1.5 crore.