With over 70 years of experience, this transport and logistics company operates in several European countries with a team of approximately 2,500 direct collaborators. Its logistics network includes 35 operations centres and 400,000 m2 of warehouses designed to process around 7 million tonnes every year.
This success story reflects the transformation process of the payroll teams, responsible for payroll processing for all group collaborators, and the human resources team, responsible for the processes of selection, admissions, hiring and training.
Both teams that were the scope of this transformation, payroll and human resources, perform specifically transactional functions. In the case of the payroll team, the challenges faced by the team were to critically evaluate the quality of the service provided and to analyse its internal processes from the efficiency perspective. The goal of the transformation in the human resources team was to improve productivity in selection, admission and training administrative management processes.
To meet the challenges raised, a multidisciplinary project team was formed to carry out, initially, a diagnosis exercise to identify the critical areas of intervention and, secondly, to be responsible for leading the process of implementing the improvement actions.
Payroll productivity improvement
Regarding the payroll team, the analysis of the payroll processing began with an audit of possible deviations. For this purpose, the values processed were reconciled with the accounting results and by sampling the degree of compliance with the different payroll budget items in accordance with the established contracts was verified. To complement this analysis, the evolution of personnel costs and related budget items was evaluated.
In this study, opportunities were identified, such as the discrepancy between values registered in different software, lack of updating of contractual changes of the collaborators in the processing system, errors in parameterisation of meal or break times that affect the payment of overtime or night hours, unnecessary manual validations, and lack of a systematic and standardised process for registering absences or missed workdays.
Additionally, all the steps that make up the payroll processing were analysed from the point of view of their risk. For this purpose, it was a step-by-step mapping of each process was performed, from the origin of the necessary information to the result of its execution.
For the risk analysis of each process step, it was identified which potential errors may occur, what the cause for those errors was and what the current control method is. By mapping the different flows, a lack of standardisation and processes with high potential for error was identified due to the lack of control points and anti-error systems, manual insertion of data, manual handling of files and validations performed only at the end of the processing.
To assess the team's workload, the Time Writing exercise revealed that most of the time is spent on tasks with low added value, such as answering queries or managing complaints, preparing and importing files or conference/audit activities.
The comparison between workload and available work capacity showed a high variability of the volume of tasks throughout the month due to the seasonality of some processes. To tackle this, it is essential to review the workload distribution and increase the information flow to balance the tasks.
Moreover, high variability was detected among different team members. This means that the same process is, in most cases, performed in different ways. Therefore, training plays an essential role in reducing this variability as it contributes to knowledge levelling within the team.
Throughout the entire diagnosis process, several tasks with potential for automation were identified, namely the introduction of information received into the system, the export and manipulation of data, and the sending and submission of information to third parties. With the use of automated and robotised tools, a 25% reduction in the time spent on these tasks is expected.
To organise the improvement activities, KAIZEN™ Events implemented:
- Error Control: definition of standards, creation of anti-error mechanisms and standardisation of parameterisations in the system.
- Process Productivity Improvement: balancing of the team's load/capacity, implementation of virtual daily planning meetings and process automation.
Improvement of the service provided by human resources
The improvement of processes in the Human Resources team focused on transactional processes, with the aim of increasing productivity and the level of service provided to internal customers.
One of the processes that was the target of transformation was the process of admissions of new collaborators. We began by defining a hiring strategy that would ensure maximum tax efficiency with fixed hiring arrangements throughout the first years after admission.
The implementation of electronic contracts for all collaborators has reduced the time spent searching for information and file management.
To reduce the hiring Lead Time, specific communication channels were created between the HR and payroll teams to prevent the loss of information and ensure that the process does not stop for validations or corrections.
The standardisation of onboarding also contributed to the decrease of this time with the creation of standards for collecting all the applicant's contractual information. Besides this, the standard for automatic contract renewals was defined describing the characteristics of the contracts that must be renewed and the corresponding conditions.
The training management was identified as one of the most bureaucratic processes for the team, despite being one of the most relevant and with the highest added value for the company. Thus, the implemented improvements aim to reduce the tasks waste associated to this process, both for the HR team and for the internal trainer.
The adoption of a computer system to collect trainees' attendance and evaluations, as well as the standardisation of the role of the internal trainer, were the most remarkable initiatives in the improvement of the training services provided.
The main output of the selection process is to get the best possible candidate for a specific job. Besides the time in which selection is carried out, it is also important to improve the quality of this selection. To do so, it is fundamental that the team frees up time from tasks with less added value, such as managing requests to open processes, preparing interviews, or creating recruitment notices. In this context, automation and standards have been created that allow online requests for opening processes or even the creation of hiring notices using anti-error systems that detect failures when entering data.
Other important initiatives were the dissemination of the improvement culture throughout the organisation, and these initiatives made a positive contribution towards an increase in the productivity of the payroll and human resources team (reduction of 4,200 and 3,500 hours of work per year, respectively). The service delivered by these teams became more differentiated and relevant for the different business units. Quality and service levels were significantly improved during this transformation.