Woolworths upgrades HR system to the cloud with SAP

Woolworths partnered with SAP SuccessFactors to replace its 20-year-old payroll system with a new end-to-end human capital management system.

For the last 20 years, Australian retail giant Woolworths has been running on the same payroll system, which meant a lot of processes were manual and form based, and the system itself had reached end of life.

In fact, per annum, 300,000 faxes were sent, while 465,000 master data changes and 250,000 annual leave forms were submitted.

At the same time, the legacy platform was made up of over 12 systems, which were heavily reliant on on-premises tools such as Access and Excel, as well as some home grown in-house solutions that were supported by Woolworths' IT team. This meant there was a lot of data duplication and no single source of master data within the organisation.

Speaking at the recent 2016 SAP Sapphire Now event in Orlando, Florida, Alison Merner, Woolworths then-head of HR transformation, said this system impacted on the engagement level of employees and how much time they spent on administrative tasks. She said this triggered the need for the company to overhaul its entire human resources function three years ago.

"We recognise in order for our business to sustain and stay ahead, we need to have the 198,000 employees within our organisation effectively engaged to be able to deliver," she said.

The company established a so-called people strategy to focus on improving four key areas: Recruitment, development, and retaining talent; developing greater leadership; simplifying the ways of working within the organisation; and rewarding and recognising the contribution of its employees.

"What we needed was simple processes that would take the admin burden away from HR, ensure line managers could be accountable for the development of their people, and employees own and manage their own careers," Merner said.

"[It's] that we could have clarity of goals and objectives across the organisation that could be seen by teams and business units to ensure we were aligned with what we wanted to achieve. From a HR perspective, it was the start of a continuous improvement in terms of people and people processes to ensure we could achieve that people strategy."

Woolworths engaged with SAP to deliver an end-to-end human capital management system on the SuccessFactors platform. The rollout was delivered in several modules: Performance objectives, talent and success, payroll and self-service, learning, and reward.

Bernadette King, HCM program director at Woolworths, pointed out that the decision by Woolworths to develop this new system was a significant one as it forced the company to decide whether it wanted to remain on-premises or move into the cloud.

"We were in a position to make the decision of whether we needed to go to the full cloud solution. We decided we were moving to the SuccessFactors Talent suite, but the key decision we needed to make was around employee central and payroll. At the time, there were few that had gone live on an employee central or the employee central payroll solution," she said.

King said the decision to move into the cloud was a clear one based on several benefits that included lowered cost of ownership, greater flexibility, standardised business processes, and improved security compliance.

As part of completing the delivery of the company's talent and succession module in July 2015, Merner said the company was able to complete the remuneration cycle for the first time online.

In parallel to delivering all the other modules, the company also delivered an employee central and employee central payroll implementation, which was just completed at the start of the month.

While Merner said it's still early days, she pointed out that 166,000 employees are already being paid through the employee central payroll, and there have been 82,000 logins into the system; while 10,000 changes have been paid to employment details and another 9,000 leave requests have been made online.

As a result of the overhaul, Merner said Woolworths' employees now have visibility of their pay slips, leave balance, and access to a portal where they can update their personal information such as emergency contacts and bank details, as well as job vacancies within the company -- something that was difficult to obtain details about until after a hire was made.

Disclosure: Aimee Chanthadavong travelled to 2016 SAP Sapphire Now with SAP.