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Building the Employee-centric HR with Service Design Thinking

Building the Employee-centric HR with Service Design Thinking

As a consumer of various services, like banking, I’m occasionally frustrated by the surprising complexity of doing simple things, stuck in some multi-layered voice system or surfing across internal silos (sometimes in an endless loop) when trying to resolve an urgent problem.

I like to complain about customer service as much as anyone, but I must admit that on average, my experience has improved dramatically in the past few years as some of the better players out there have upped their customer service game. The very best deliver an effective blended online/bots/phone/in person experience that help me get things done easily. In more sensitive situations such as the occasional fraud on my account, a knowledgeable agent will (often) own the problem and eventually resolve it with empathy and courtesy. All this with no visible increase to the cost of service.

How did they get there so quickly and what is the secret sauce? Answer: Service Design Thinking and Customer Experience (CX) Management.

As employees, we’ve all experienced ‘Kafkian’ frustration with HR services or systems. In many respects, employees and candidates are the customers of HR services. We react to HR service experience in the workplace with equal or greater frustration / appreciation as we do when consuming banking services. Our expectations of HR are now shaped by ever-improving experiences as consumers – in other words the bar keeps going up for HR service quality and the pace is set by rapidly accelerating CX improvements outside of HR.

Service Design and CXHR management: Why bother and what’s at stake for HR?

In the world of customers, great service experience translates into significant Business Value, in the form of increased retention rates and customer spend, which in turn drives market share and revenue growth. Customers with a choice will naturally flow to the best available experience. An additional benefit is often reported: Reduced cost to serve and therefore higher margins.

In the world of HR, great service experience will drive engagement (of either employees or candidates) with benefits of increased retention and workforce productivity. This applies to the most transactional HR interactions, where employees naturally expect an effortless experience (for more on Effortless Customer Service see this excellent book). For the more critical ‘Moments that Matter’ (Onboarding, relocation, recruitment, life event, etc…) where HR creates – or destroys – disproportionate amounts of employee engagement, employees expect ‘White Gloves’ experience levels in return for engagement towards the company. In many ways what we’d expect from our banking provider in the event of fraud or other ‘charged’ event…

We live in a talent-constrained environment where employee experience is transparently shared on Glassdoor and good talent will pick their employer of choice. This is a ‘buyers’ market’. Just as customers flow to the best service experience, the best talent naturally flow to companies with the best employee experience.

 

 

HR does controls most (but not all) levers of Employee Experience and Service Design Thinking offers a potentially game-changing opportunity for the HR function to directly improve Engagement and workforce productivity. An added benefit of reduced cost to serve is the icing on the cake in a ‘do more with less’ world.

We’ve seen companies adopt two approaches to this challenge / opportunity:

First Approach: Do nothing for now and stay on the fence – ‘I never worry about action, but only inaction’ (W. Churchill). In current course and speed, HR Leadership Teams are consumed by two families of priorities:

1. Implementation of a cloud-based HR system

HRIS systems do deliver benefits such as data centralization and access, UI improvements etc… However, they are designed to advance HR staff experience rather than to improve Employee Experience. While there are possible secondary (one of our clients used the word ‘accidental’) employee experience benefits, weak end-user adoption and the failed promise of employee self-service currently get in the way of many HRIS business cases.

2. Focus on HR productivity

We see a mix of productivity/efficiency focused initiatives such HR Process reengineering, more automation in the form of bots and apps sprinkled throughout the HR service landscape, investment in point technology solutions that incrementally increase productivity in select areas, etc…

All good things on paper but one major piece of the puzzle is missing: The point of view of the most important person in the room when it comes to Employee Experience: The Employee.
Meanwhile, the bar for HR service experience keeps accelerating upward and more nimble talent competitors get ahead… Attracting and retaining the best talent is a zero-sum game.

Second approach: Put employees at the center and embrace Service Design Thinking for HR: A growing number of HR Leadership teams are keen to import design thinking principles from the product and service world and use the methodology to redesign HR services.

Cisco famously convened their global HR staff in a two-day giant hackathon, with a mission to redesign HR services and deliver on the vision set by the CHRO Francine Katsoudas and HR Leadership Team: ‘One size fits one’, i.e. mass customization to deliver the best employee experience in a scalable way.

 

We now see great urgency from global HR leaders to follow early adopters and innovate their services from an employee-centric perspective. However, the path to success is not obvious and still a work in progress for most. Let’s explore it in more depth, beginning with learnings from the world of Customer service design.

What is Service Design Thinking?

According to Ideo, one of its pioneers, product design thinking “Utilizes elements from the designer’s toolkit like empathy and experimentation to arrive at innovative solutions. You make design decisions based on what future customers really want instead of relying only on historical data or making risky bets based on instinct instead of evidence.’”– Ideo

When applying the principle to services rather than products: “A service is something that I use but do not own. Service design is therefore the shaping of service experiences so that they really work for people. Removing the lumps and bumps that make them frustrating, and then adding some magic to make them compelling.” – Mat Hunter, Design Council

The key steps of this method to innovate services are:

• Group users in segments represented by Personas
• Draw a customer journey map from the persona’s perspective through data and empathetic observation
• Clearly define the problem we’re helping the user solve
• Cross-silos teams collaborate to innovate a ‘Minimum Viable Service’ that solves the holistic problem (not just a segment) and re-draw the journey map
• Measure user experience (CX) and iterate

What lessons learned from Customer-facing teams who have implemented the method?

1. This approach is about fast experiment / measurement and redesign, not about getting it right first time. Over time, teams adopt a new mindset of continuous improvement and constant innovation of the services they manage.

2. ‘Service Design Thinking’ is really ‘Service Design Doing’: Teams learn by doing and practicing. Training, white papers and lots of thinking don’t change mind or skill sets. The website ‘This is Design Doing’ is a treasure trove of resources on how to do service design, including a recently published book. The site’s name says it all…

3. On how to transition an existing service structure to Service Design Thinking , three main lessons from practitioners and some good detailed perspective in this McKinsey article:
• Real gains in customer satisfaction are realized when optimizing journeys at the touchpoint level as well as the entire journey level – the whole experience is not necessarily the sum of its parts.
• Most begin with one ‘High Reward’ service to validate the concept and use early success as leverage point for change, rallying teams etc…
• Essential to manage through CX KPIs: measure CX early and bake it into management / recognition systems to reinforce customer-centric behaviors over time

One great piece of news for HR: Customer-facing teams had to overcome the major challenge of silos being owned by multiple functions (Sales, Marketing, Service, etc…), making it difficult to drive action and ownership.  We in HR directly own our service silos so driving change in our world should be much easier!

How are companies using Service design thinking in HR?

We have not yet encountered a mature implementation across all HR services (please let us know if you have!) but a blend of efforts involving Design thinking training as critical HR competency and part of a renewed focus on HR innovation; Hackathons (local or global) and Creation of Employee Experience committees / governance systems and EE communication streams.  Practitioners have reported 5 challenges and questions and here are some partial answers:

1. How does Service Design fit with other elements of our HR strategy (HRIS, digital, etc…)?

Service Design thinking is an essential asset in a fully digital HR function – see Volker’s post on the What and the How of a Digital HR strategy. By placing employees at the center, service design and CX measurement are the reference ‘truth-tellers’ of what should be automated and when… Automating a poorly designed service that generates negative experience will make it worse, under the cover of being cheaper in the short term.
Bots, apps, and other automation systems hold huge potential to handle HR service tasks with high quality / low cost to free-up resources. However, HR teams should use employee-centric service design to guide the roll-out and own the roadmap. Design and experimentation comes first – technology second.

2. We’re not sure about what to hack first – where to start?

HR teams do not have much spare capacity beyond their day job and must prioritize which services to redesign. Services are not equal in their impact on engagement and require different levels of experience:

• Moments that matter are the most critical. Employees follow a complex journey that often spans multiple HR silos during these moments (i.e. Onboarding or Relocation). Practitioners use a shortlist of ten or so, where the target for employee experience is at its highest, both ‘Effortless’ and ‘White-Glove’. In other words it should feel both easy and memorable (in a good way!).

Our co-creation group of 25 companies is currently building a CXHR measurement system for moments that matter: They have prioritized ‘Recruiting’ and ‘Onboarding’ as the first to tend to – not surprisingly given how much business value is at stake there. We measure two KPIs:  Customer Effort Score – CES – for effortlessness and Net Promoter Score – NPS- for satisfaction.

 

• The objective with Transactional services is less ambitious: To become Effortless, as measured by CES (Customer Effort Score). A rule of thumb is to begin with the most ‘abrasive’ service i.e. generating the most negative experience

3. How do you sustain the effect of Hackathons and Design Thinking training over time?

Hackathons (also see here) and associated training efforts are an effective point of rally for teams and a jolt of energy that sparks new ways to think and collaborate. However, in line with the principle of ‘Design by Doing’, HR teams should quickly bake Service Design in their everyday work to sustain the drive for service innovation and user-centric design over time.  To do so, a comprehensive and prioritized ‘service redesign roadmap’ guides teams as they tackle the long list of HR services. This map includes KPIs and progress milestones as well as suitable reinforcement through HRLT’s management practice and communication streams.

Some start small to validate the proof of concept before a broader roll-out, while others use a big-bang approach, but the philosophy is the same: Teams learn and embrace the concept ‘by doing’ not ‘by training or reading’

4. How do we use a scalable design method globally and still capture local needs?

Employee journeys at moments that matter can be quite complex and difficult to capture; in large, global organizations, applying different methodologies, terminology or tools when redesigning these journeys, leads to breakdown in scale for services that should inherently be global with local versioning.

 

For example, a recruitment journey (pictured above) should be different in the United States vs China but the methodology to capture, build and redesign should be the same. Some organizations use purpose-built tools to do so and anchor a consistent approach through the HR function.

5. We can’t drive forward without KPIs – what/ how should we measure and benchmark?

CES and NPS are the KPIs of choice. Measured at the touchpoint and journey level, they offer an exciting solution to manage the effectiveness of HR teams and services as perceived by the employee and user of these services.

As leaders of Customer-facing teams have found, these measurements will focus the HR function on what matters most: the experience it creates for employees. The ability to benchmark experience data internally or against talent competitors also offers a great opportunity to manage the function upwards in a spirit of continuous improvement.

Conclusion

Service design thinking (or doing!) is a relative newcomer to the world of HR yet brings a great pedigree of success and proven business benefits from the Customer-facing world. No other approach to HR innovation or process redesign holds as much potential to directly drive Employee Experience and shape HR’s contribution to Employee Engagement.
The method is intuitive and engaging for HR teams, does not require massive investment, promotes lower cost to serve and supports one of the major reasons why most HR professionals chose an HR career path in the first place: ‘to help people’.

CM

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