Case Study

HGS unites cross-border teams through consistent and efficient payroll and leave management processing

Objective
In the logistics industry, speed, timeliness, accuracy, efficiency, trust, and responsiveness are highly valued business traits. One of the world’s leading freight forwarding and supply chain management services company (11,000+ employees with a presence in 100+ countries) sought to apply these business concepts to some of their internal processes, including their Human Resources (HR) function. 

As an international business process management (BPM) company, HGS provides an array of services. This client was interested in the HRO services that HGS provides, which include human resource management systems (HRMS), payroll, HR administration, HR consulting, recruitment and staffing, training and development, HR analytics, and HR social media. 

The client, based in the United Arab Emirates, needed to integrate payroll processing services across nine middle eastern countries with diverse HR legislation and cultural standards. The client also required a leave management system (LMS) to support and manage employee absence data on a real-time basis. Finding efficiencies and bridging the gap between the HR and finance teams (as well as employees and managers) was top of mind. 

The client invited HGS to complete a needs analysis and prepare a proposal to explore the potential advantages of HRO. HGS and the client agreed that the solution involved increasing accountability and co-ordination related to the confidential salaries and payouts and replacing manual, Excel-based processes with automated systems. After offering a logical implementation approach and a scalable price per employee per month (plus upfront setup), HGS’s payroll processing unit in Dubai was engaged to deliver the solution. 

Our Solution
The HGS Middle East and North Africa (MENA) team was hired to coordinate knowledge transfer, document operational processes and procedures, design/build and generate reports, define governance structures to ensure success, establish standard workflows and exception workflows, implement the technology changes, provide appropriate training to the client’s HR administrators and employees, and support the HR function for a three-year period.

Payroll Automation

For the payroll operations, HGS took responsibility for database creation and population (across all geographies), report generation (including pay slips and customized reports for banking and management), and facilitating an ongoing automated processing system.

The client’s manual-based solution did not provide a holistic view of data and did not promote accountability or co-ordination between the HR and Finance functions. The client relied on calculations in local Excel spreadsheets for payroll and monthly, quarterly, and annual reports. With a goal to save weeks of labour each year, HGS collaborated with the local HR representatives to design and develop eight detailed reports. As the project progressed, the team began to see that, as a result, they would have more time to focus on their core, value-added HR tasks.

HGS’s approaches not only streamlined HR tasks, they promoted greater trust and better collaboration between departments, geographies, and employees. The workflows clarified when and which inputs were required. The system also minimized differences in languages, currencies, and labour laws. The implementation drove a level of operational efficiency that would be expected for a company that specializes in overcoming cross-border challenges.

Leave Management System Implementation

HGS was engaged to leverage the client’s tacit HR knowledge to design, implement, and facilitate a common leave module for managing real-time absence and attendance. Using the leave management module of HGS’s preferred HRMS platform, HGS oversaw the software installation, configuration/ customizations, and master setup, including migration of the existing workforce, ongoing employee entry and exits, user training and support, as well as technical administration and hosting.

The HGS-provided, cloud-based leave and attendance system module adheres and conforms to the client’s leave policy, master holiday calendar, and approval matrix in different geographies. The system design includes leave accrual calculations according to labour stipulations, contracts, and policies and leave application and approval workflows to ensure compliance.

The LMS provides employee self-serve access for leave application and leave balance tracking, and an HR administrative module for reporting and leave balance adjustments. Employees can cash in on unused leave time; these payouts are now based on unbiased, tabulated data rather than subjective estimates and negotiations. The implementation of the LMS has had a positive impact on employee engagement, as employees are happy to have self-serve access to vacation allotments. Automation not only increases financial accuracy, it ensures a greater level of fairness across locations and teams.

Outcomes
HGS’s service delivery model brings standardization, compliance, and predictability while optimizing HR efficiency. It also provides metrics and analytical tools for stakeholders across the client organization. As a result, the following aspects of the client’s middle eastern operation have improved:

1. Speed and Timeliness

  • Payroll processing time has reduced from three days to one working day per month. Pay slips are produced and distributed in a timely, reliable manner. Reports are generated on click.
  • Communication related to leaves and absences between managers and employees and between HR and Finance happens in real-time through a common interface.

2. Accuracy

  • Payroll accuracy has increased to almost 100%.
  • Leave-related formulas are applied with 100% consistency across geographies and departments, and managers now have an accurate and reliable record of employee holidays with which they can properly plan work rotations and assignments.

3. Efficiency

Using common systems and automating payroll has reduced mail and courier costs and time delays. The systems allow the client flexibility to scale up and down as required without adding extra HR team members. Automation ensures workflows are followed consistently.

4. HR Responsiveness

Employees now have the ability to track and record their planned and unplanned absences themselves, which allows HR, finance, team members, and management to make administrative adjustments accordingly and allows more time to respond to genuine HR issues.

5. Trust in HR

Trust in the HR function has improved, as the data, reports, and advice the HR team provides is more reliable. HR data is handled and viewed by fewer people, which increases confidentiality and provides peace of mind for employees.

Engaging HGS has united cross-border teams through consistent and efficient payroll and leave management processing and has provided tools and techniques to further streamline the HR function.

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