Stanford University
HR Centers of Expertise
Budget Group
March 16, 2011
© Huron Consulting Services LLC. All rights reserved.
Table of Contents
2
Section
Page
Hiring and Recruiting
3–5
Compensation
6 – 10
Transactions and Records Management
12 – 15
Financial Roll-Up
16 – 17
Appendix
18 – 22
Staffing & Recruitment
Key Observations – Staffing and Recruitment
Current distributed staffing and recruitment practices lack an efficient methodology for
identifying and screening qualified candidates
CURRENT STATE
• Inefficient methods limit effective utilization of candidates
- Current practices obstruct sharing of top candidates
- Process requires repetitive review of unqualified candidates
• Qualified candidates are likely being overlooked
- Nearly 20% of resumes go unreviewed
• Specific skills, knowledge and abilities are required to
effectively recruit and screen candidates
- Managers who hire infrequently (and those who assist them)
may not be as effective as trained recruitment professionals.
• Compliance risk
- Federally mandated disposition data is not completed in 37% of
job requisitions – requiring OSE to audit and follow-up
• Fee-for-Service limits use of OSE resource
- Hiring managers without the ability to pay must rely on
individuals with less expertise (or themselves) to complete this
work
4
RECOMMENDATIONS
• Implement a Center of Excellence (CoE) Pilot to demonstrate
how improvements can be made to the hiring process for
increased efficiency and better quality hires
- CoE should manage the key stages of process - recruiting,
advertising, applicant pre-qualification, interviewing, and
disposition data entry
• Eliminate OSE’s fee-for-service model to allow access to
resource regardless of ability to pay
CoE Pilot – Staffing and Recruitment
Stanford should develop a CoE pilot to effectively manage key process stages
Hiring Manager
opens job
requisition
through Trovix
and contacts the
Center.
The Center assists
in advertising in
addition to
StanfordJobs.com
The Center screens
incoming resume
and conducts
preliminary phone
interviews
Hiring Manager
selects face-toface interview
candidates and
conducts
interviews
Hiring Manager
and Department
select final
candidate
Pilot Benefits and Measurement
Benefits
• Pool Sharing – Top candidates for positions in common job families will be leveraged and
effectively utilized across the institution (admin. assoc,. finance, IT, research assts. etc.)
Central OSE enters
disposition
information and
informs nonselected candidates
HRA helps with
on-boarding and
initial data entry of
candidate
• Advertising – May be consolidated or eliminated in some cases resulting in reduced costs
• Mitigation of Risk – CoE will enter disposition data for pilot positions
Performance Measures
Recommended
Staffing
• Turnover – percentage of pilot hire separations compared to rest of University
• New Hire Qualifications – numerical assessment of how closely the hired individual
matches the requirements as listed on the requisition
• New Hire Performance – numerical ranking in performance evaluation or size of annual
compensation adjustment tied to performance (merit increase and bonus)
5
4.0 FTE
Compensation
Key Observations – Compensation
Recommendation to design and implement new market- and career-based system to address
key concerns
CURRENT STATE
• Process viewed as complex and bureaucratic
- Duplication of effort and resources in evaluating jobs;
question about whether best handled by HRMs
RECOMMENDATIONS
• Simplified/streamlined system and process
- Supporting efficient use of resources – availability for
HRMs to focus on other strategic HR efforts
• Inconsistency in job evaluation decisions across the
• Consistent/fair job assignments to market-based
university
salary grades/ranges
CURRENT
STATE
- Causes concerns among managers, employees, and
HR
- Providing assurance of correct valuations of jobs leading
regarding internal equity and external pay competitiveness
to improved trust in the system
• Lack of understanding and trust in current approach
- Driving concerns about competitiveness with the external
market
• A market-based system
- Driving closer alignment of pay ranges for individual jobs
to the external market
• Lack of clarity and transparency regarding career
levels/progressions by job function across the
university
- Causes confusion among managers, employees, and HR
on what requirements are needed to progress to the next
level
• Clarity/transparency of career levels/progressions
- Leading to better understanding of career paths resulting
in improved employee engagement
Towers Watson worked with Stanford University on a review of the current compensation process and system to confirm and clarify
problems with the current system and develop a recommendation to address such problems
7
Illustration: Recommended System
• Job levels
- Determined by University
Compensation (centralized - consistent)
based on market data (simple, clear) for
Stanford jobs matched to survey jobs in
partnership with managers
• Salary ranges
- Developed by University Compensation
using market data collected from
Stanford jobs matched to survey jobs
(above process)
 Each job assigned to salary grade
based on mid-point of closest tie to
market (market competitive - job level
not a determinant of salary range
• Career Based
- Career progression developed by using
market-based job hierarchy
8
Salary Structure
Grade
Minimum
Midpoint
Maximum
12
$177,000
$239,000
$301,000
11
$151,000
$196,000
$242,000
10
$125,000
$163,000
$200,000
R&D Manager
Market Rate = $115k
9
$105,000
$136,000
$168,000
8
$87,000
$113,000
$139,000
R&D Engineer-Sr.
Market Rate = $91k
7
$74,000
$94,000
$115,000
6
$63,000
$80,000
$98,000
5
$54,000
$68,000
$81,000
4
$47,000
$59,000
$71,000
3
$41,000
$51,000
$62,000
2
$35,000
$44,000
$53,000
1
$30,000
$38,000
$45,000
Financial Analyst – Int.
Market Rate = $61k
Resources – Current vs. Recommended
Recommended system requires the addition of 2.0 FTE: results in an easier to use and
more efficient system, and productivity gains of 3.5 FTE
Current System
# Job classification
reviews per year
Time spent on job
classification
Total hour spent on job
classifications
Total compensation
FTEs to maintain
system
Recommended System
545 reviews
363 reviews (assumes 1/3 future
reduction)
19 hours per review
– Mgr = 7 hours
– HRM = 7 hours
– Comp Analyst = 5 hours
9 hours per review
– Mgr = 4 hours
– HRM = 1 hour
– Comp Analyst = 4 hours
8,540
– Mgr = 3,815 hours
– HRM = 3,815 hours
– Comp Analyst = 910 hours1
3,267
– Mgr = 1,452 hours
– HRM = 363 hours
– Comp Analyst = 1,452 hrs2
3.5 FTEs
5.5 FTEs (inc addt’l) 2 FTEs3
Mgr = 2,363 hours (1.4 FTE)
HRMs = 3,452 hours (2.1 FTEs)
Productivity gains
1/3 of reviews currently involve Compensation Analyst – 5 hours x (1/3 of 545 reviews) = 910 hours
in role for Compensation Analyst from consulting to conducting all job reviews
3 Reflects additional FTE to maintain recommended system to cover such activities as audits, additional survey work, additional time for work on individual
job classifications (more client interface) and participation/consultation on all reviews not just a third
1 Approximately
2 Shift
9
Transactions and Records Management
Key Observations – Transactions
Non-standardized, redundant, and multiple touch processes result in high inefficiency and
critical errors
Current State Observations
Recommendations
• Non-standardized processes within the
various transaction types result in transaction
delays, errors, lack of defined roles and
responsibilities and internal controls; every
department handles each transaction with
different processes and people
• Implement a Transaction Center of Excellence
(CoE) Pilot to centralize transactions
• Of the 148 authorized transactors 60%
produced only 10% of total transaction
volume
- Mitigate the loss of knowledge due to turnovers
and effectively manage seasonal fluctuation
through allocation of other central resources or
proper training of temporary staff
• 41 distributed transactors spend between
50% and 100% of time focused on
transactions
- Re-allocate transactors who spend 50% or more
of time on transactions
• In FY2010, the average departmental error
rate of critical (pay and benefits) transactions
was 6.2%
11
- Redesign/standardize end-to-end process, that
results in efficient , transparent, and improved
customer and department service levels
- Reduce critical transaction (pay and benefits)
error rates to below 1%
CoE Recommendations – Transactions
Centralize transactions to achieve process improvement, transparency, improved
customer service levels, and error reduction through standardization and knowledge
capture
Current Transaction Processes
Dept.
People
Touches
# of
Steps
Sufficient
Internal
Controls
A
2
5-7
No
B
6
7-12
Yes
C
3
5-9
Yes
Centralized Process
• Transaction
addressed and
acted upon
• Dept. Manager
seeks internal
approval for
change (i.e.
Finance, Dept.
VP or Dean)
• With proper
approvals, Dept.
Manager moves
to start
transaction
Department
Manager or HRM
populates Action
Form
Central originates
and completes
webform
Central enters any
additional required
information (if any)
and uploads to
PeopleSoft
Hiring Manager or
HRM approves
webform
No: Insufficient
information
Centralized Process
Will be performed by Central CoE, using a
standardized Action Form template specific to
each action type.
People
Touches
#
Steps
2
4
Data Driven Analysis
 A Transaction Resource Projection model was created that calculates the projected
number of full time transaction specialists necessary
 The model includes a complexity matrix to determine time and complexity of all
transaction types, for each type of employee
 Processing time was then calculated for each transaction action/type for each
employee type
 Implement a pilot comprised of 1 manager and 3 transactors to centralize
transactions for a specific number of departments (tbd) to initiate the CoE
12
Recommended Transaction
CoE Pilot Staffing
4.0 FTE
Appendix
Hiring and Recruiting Pilot: Implementation
A hiring and recruiting Pilot will require approximately 4 resources across specific
departments (tbd)
High Level Plan
1
Finalize selection of pilot departments
2
Hire new resources to shift to center
3
Assign roles and responsibilities to central staff (including backup support and focus on trainings, CoE development,
central database, and process improvements)
4
Develop and build in mandatory trainings for CoE resources and at department level
5
Evaluate service levels and performance measures of the pilot, and any additional departments added to center
6
Evaluate staffing and build up resources if additional departments are to shift to CoE
7
Transition additional departments
8
Continue to improve and develop services
Note: OSE currently has two (2) full time recruiters, which could transition to the CoE
14
Compensation: New Market- Career-based System
Key Project Implementation
Phases
I. Set Foundation
II. Conduct Detailed Analysis
Steps
1. Conduct project planning and data collection
2 .Confirm target market and competitive position for jobs
3. Match Stanford jobs to surveys and gather market data
4. Develop new salary structure and assign jobs
III. Design Structure & Level Descriptions
5. Develop descriptions for job series progressions
6. Validate with HRMs/Specialists and Managers
7. Develop pay delivery/administration guidelines
IV. Implement
8. Development implementation plan
9. Develop communication materials and rollout
Note: Estimated timing 49 weeks (timing may vary based on availability of key stakeholders and project resources to provide input, conduct steps, review
deliverables, and make decisions
15
Transactions: Implementation
A Transaction CoE will initially require approximately 4 resources across 3 departments,
with a defined management team to operate in FY 2012.
Transaction
Specialists
Department 1
1
Department 2
1
Department 3
1
Transaction
Management
Total
 PeopleSoft HRIS operations
– Web form creation and maintenance
1
4
High Level Plan
16
CoE Services, Activities, and Accountability
– HR data upload and entering
– Provide guidance to individual PeopleSoft
users on the implication of certain data input
– Provide functional instruction to individual
PeopleSoft users
1
Determine CoE staff, using existing resources and/or brand new resources
2
Create the necessary actions and put in place specific procedures, policies,
training, and performance measures
3
Develop standardized Action Forms for each transaction
– Provide backup to historical data
4
Perform PeopleSoft module training to upload the Stanford specific Action Form
– Provide real time ad hoc report support
5
Create Trainings for the each type of transaction by each employee type
6
Transition the three departments to Transaction Center, spreading transactions
across all 3 transaction specialists
7
After 6 months, evaluate staffing and build up resources as additional need is
determined
8
Transition the remaining transactions for the remaining 3 selected departments
to the Center; monitor and track for efficiency and quality
– Ensure HR data integrity and accuracy
 Report creation and maintenance
– Create cross functional reports (e.g. HR,
Payroll, and Finance)
 Trainings
– Provide periodic training on Web Form usage
and specific processes related to data
transfer into PeopleSoft
 Records Management
– Collect and maintain I-9 forms
– Collect and enter Disability related
transactions
Value of Expertise– Staffing and Recruitment
Specific skills, knowledge and abilities are required to effectively recruit and screen
candidates; managers who hire infrequently (and those who assist them) may not be as
effective as trained recruitment professionals
REQUIREMENTS FOR EFFECTIVE STAFFING AND RECRUITEMENT:
SKILLS, KNOWLEDGE & ABILITIES
1) Job Market Knowledge
- understanding of skill set availabilities, competition & market dynamics
2) Recruiting Knowledge and Sourcing Skills
• Generating passive candidates - people not seeking work
- Internet recruiting (DNA searching), social networking competencies, lead
generation and referral processes
• Generating active candidates - people seeking work
- job boards, aggregators, web analytics, search engine optimization
• Marketing and branding – turn job descriptions in “career opportunities”
• Database searching – “mine“ Trovix and other candidate databases
3) Screening, Interviewing, Candidate Management Ability
• Screening/Interviewing - for technical and soft skills (critical for job success)
• Maintaining candidate interest – during lengthy hiring processes
• Compliance - with federal regulations regarding disposition data
4) Hiring Manager/Search Committee Consulting
• Effective Processes – Manage large applicant pools and interview teams
• Candidate evaluation advice - Assessing soft skills; legal interviewing
17
HIRING MANAGER CHALLENGES
• Time
- Frequently inadequate to effectively screen
applicant pools
• Recruiting Skills (infrequent practice)
- Generally, don’t possess high level
recruitment skills needed to source and
recruit top candidates
• Interviewing Skills (infrequent practice)
- May lack training/ability to completely
assess candidates - tend to assess technical
skills only.
- May have difficulty determining “fit” motivation, commitment, flexibility, ability to
work in Stanford environment, team work,
etc.
• No Pool/Applicant Sharing
- No access to top candidates in similar
applicant pools at Stanford