HRMS Scoping Study

Proposal
Human Resources

Submitted by: Joe Kittleson, Benefits Manager Date: 10/29/2004

Executive Sponsor: Patti Carson, Vice President for Human Resources

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1.0 Business Case

At the University of Washington many core Human Resources functions are performed
in departments by departmental staff. The current workforce management processes
and systems have as their foundation the University’s payroll system, the Higher
Education Personnel and Payroll System (HEPPS). For over 20 years business
processes and systems changes have been wrapped around HEPPS in an attempt to
force it to function as an ad hoc workforce management system as well as fulfill its core
mission a payroll system. As a result, the current systems that departments use to
manage staff are built around payroll functions alone, not the full scope of human
resource management functions. The current system design’s focus on compliance
with payroll requirements and regulations ignores the reality that labor contracts,
policies and regulations are written and enforced at the person level, not at the level of
labor distributions. A HRMS is needed to manage and analyze workforce information to help
the University be more efficient, be able to plan and develop our workforce, and to enhance our
ability to proactively identify and correct deficiencies.

1.1 Purpose of Project:

Why an HRMS?
A modern HRMS helps an organization plan and manage the intake, classification,
staffing, orientation, compensation and benefits administration, deployment,
performance management, employee and labor relations, development and
competency of its workforce through effective information management, reporting and
analytics. An HRMS can be one system, purchased or internally developed, or an
integrated blend of internally developed and purchased “best of breed” applications.
Whatever its composition, a modern HRMS informs payroll systems with respect to who
is employed, what position they hold, benefits eligibility, etc., but it also holds and
supports analysis of long-term critical workforce information including organizational
information, individual skills and competencies, performance evaluations, labor relations
information, licensure requirements, and career development plans. Information is
entered and monitored through workflow, transaction and reporting tools for employees,
managers and departments. An HRMS includes tools to easily monitor and query
workforce data in a manner that enables an organization to efficiently find and deploy
talent, identify staffing-related inefficiencies and meet regulatory, contract and policy
requirements. In the UW’s decentralized environment an HRMS is especially mission
critical as it provides the infrastructure to enable departments and HR to perform their

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 functions in a consistent compliant manner while meeting the requirements of
departments, employees, administration, regulators and represented labor.

Current Situation
HEPPS’ underlying data design, programs and processes were built around payroll
process data needs for the specific point in time that a person is to be paid. An HRMS
takes a person as the fundamental piece of data upon which all other roles, processes
and rules are built while HEPPS relies upon appointments, job class codes, earnings
types and budget distributions as its fundamental level of data to define the person.

Without an HRMS the University lacks the ability to assess and manage employees as
individuals who have more substance and nuance than their respective payroll actions.
We lack any view into how staff are performing or (whether or) how their performance is
being regularly assessed. We do not have a reliable view of who is working for us at
any given time or the roles that they are working in.

The dynamic nature of the modern employment world yields numerous unpredictable
program, process and data changes, e.g., new state retirement plan requirements, Civil
Service Reform, etc. Such mandates have compelled the University to graft pieces of
Human Resource data management into HEPPS despite the fact that the payroll
system is not designed to function as a modern HR data repository.

With the right infrastructure provided by an HRMS, departments and HR could work
together to effectively manage performance evaluations, compensation, classifications,
training records and development plans, licensure and eligibility to work from a central
“dashboard” of tools. An HRMS will also provide analytical tools for HR professionals to
advise and consult in a highly decentralized environment.

All of this required work around workforce management is attempted by departments

and by HR currently through intensive manual processes, spreadsheets and other
inconsistent, unreliable and inefficient methods. Untimely and inconsistent workforce
information is a source of liability for the University in labor negotiations, audits and
litigation. This is but one of the systemic deficiencies that would be dramatically
reduced by an HRMS.

Risk of Continuing Current Situation

Not only is HEPPS being asked to do more than its design supports but it has been
changed by many different people in response to changing needs over time. Further
liabilities are likely to accrue if the UW does not implement an HRMS to separate,
manage and analyze employment and payroll information appropriately.

Without a fully integrated HRMS system, department and HR staff will continue
dedicating resources to redundant and cumbersome manual processes in order to fill
compliance gaps that could otherwise risk the medical centers’ continued accreditation,
funding (federal grants, Medicare) and compliance with federal and state regulations or
collective bargaining agreements.

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 The UW is poorly positioned to manage the people who are the core of its business.
We have a limited capacity to establish consistent paths of support and accountability
for departments, managers and employees.

Return on Investment
There will be a substantial return on investment in an HRMS through reduced liabilities
due to regulatory noncompliance, efficiencies in staffing and resource allocations, and a
reduction of the amount of work performed by departmental and administrative staff to
try to find, analyze or report information that could be provided easily in an HRMS.

The real return on investment for an HRMS is the value it delivers when in use.
Supporting managers and employees with the right tools to place the right people in the
right roles at the right times will allow departments and managers to spend the
University’s overall staffing dollars wisely. Data analysis tools will enable departments
and the UW to assess and compare staffing distribution and costs and evaluate the
efficient use of the people who account for more than 60% of the University’s annual
operating expenses (over $1.5 billion in salary and benefits). With an HRMS we can
provide both support and accountability in the management of the people who make up
the University.

1.2 Drivers:

a. Is project a regulatory requirement?

Yes. While there is no regulatory requirement to have an HRMS there are
requirements to maintain and report on the information that we now either lack or
achieve only due to thousands of hours of effort by departmental and administrative
staff.

b. State other project drivers (cost, quality, risk, performance)

• Reduced business operating costs

• Decreased liability
• Increased workforce management capacity

1.3 Benefits:

• Reduced business operating costs

o Substantially reduce the amount of work departments and administration
must perform to plan HR program offerings or benefits, prepare for labor
negotiations, and respond to audits, public information requests and litigation.
• Improved analytics for workforce management
o An HRMS will provide departments with the information and tools needed to
analyze labor costs and plan the most efficient use of their staffing dollars
which comprise more than 60% of the UW’s operating expenses.
o An HRMS will provide reliable information on which to model impacts of
legislation, policy or program changes and labor contract proposals.
• Decreased liability

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 o An HRMS will enable the University to meet contract and regulatory
obligations and reduce risk stemming from noncompliance.

1.4 Key Business Owners:

• Patricia Carson, VP of Human Resources

2.0 Project Elements

2.1 Scope of Work:

This proposal is to fund the first of three phases necessary to obtain or develop an HRMS.
All phases are described briefly below. This first phase of the project will produce detailed
business requirements, recommendations and high level scope of work estimates for
obtaining an HRMS with solid connections to payroll and financial systems (i.e., build within
UW heritage systems, purchase, blend or outsource). Project phases include:

Phase 1: Business Requirements, recommendations and high level Scope of Work

A joint HR and IS team with guidance from departmental users and Financial Management
will thoroughly analyze and document the business requirements for a complete HRMS
solution that will meet the business and regulatory needs of the University. The teams will
draw together their findings, analyze the results for any missing information and prepare a
decision framework and recommendations for the University’s executive management to
make an informed decision about the possibilities and costs of different methods of
obtaining an HRMS. Each choice presented will contain a high-level scope of work and
costing estimate for the technical requirements phase.

Based on the outcomes and recommendations in Phase 1 funding would be required to

implement the following phases:

Phase 2: Technical Requirements for HRMS

When the University has used the information acquired in Phase 1 to decide the direction it
wishes to pursue in order to obtain or develop an HRMS, the gathering of detailed technical
requirements phase can begin. Detailed technical requirements are key to bringing the
selected path to fruition. If a purchased solution is selected rather than an internally
developed solution the vendor would be brought in during this phase. This phase would
also determine and create any business process maps and change education programs
that might be required.

Phase 3: Develop or Implement HRMS solution

This phase is the actual development or implementation, testing and deployment of an
HRMS.

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2.2 Enterprise System Features and Standards

Element Yes/No Notes

Pubcookie UW authentication service Y
ASTRA UW authorization service Y
SecurID security service Y
MyUW personalization Y
C&C-hosted servers Y
Data feed Y
High availability server configuration Y
Privacy issues Y
Purchased package N
Integrate with existing systems Y
Data warehouse Y
Disaster recovery Y
Nebula desktop Y
External system N
Other <describe> N

3.0 Resource Needs – Preliminary

Preliminary estimates of functional and technical resources needed for this project. Hours
are rounded to nearest 10.

Resources Est Est Notes

Low High
Hours Hours
UW Department Staff
Business Project Mgmt 2,080 2,080 Provide reports, assist in requirements
analysis, estimates gathering. Hours
estimate is 1 FTE for 12 months.
HR Business Analyst(s) 2,080 4,160 Hours estimate is 1 - 2 FTE for 12
months.
Administrative Assistant 0 2,080 Assist with project documentation and
coordination of user group.
Other HR Staff 300 500 Provide subject matter expertise as
required (Labor Rel, Comp, HR Ops.,
etc.)
C&C Staff
Technical Project 1,040 2,080 Provide reports, assist in requirements
Management analysis, estimates gathering. Hours
estimate is 0.5 - 1 FTE for 12 months.
Technical Analyst 1,040 2,080 Assist in requirements analysis,
estimates gathering. Hours estimate is
0.5 - 1 FTE for 12 months.
Other C&C Staff 300 500 Provide subject matter expertise as

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 required (DBA, networking, DW, etc.)
Project Oversight Staff
Steering Committee 250 500 Estimate is for a 6 - 9 person steering
committee with monthly 1 hour
meetings plus escalated issue time.
User Group 1,000 2,000 Four hours per month plus prep for 8
person User group for 12 months.
Financial Management 0 500 Provide subject matter expertise and
Liaison coordination with Financial
Management.
Outside Staff
Vendor
Contractor
Other
Total C&C Staff Hours 2,380 4,660
Total HR Hours (Phase 1) 4,460 8,820
Total Other Hours (Phase 1,250 3,000 User group, steering committee, payroll
1) liaison
Total Project Hours 8,090 16,480

4.0 Cost Estimates by Fiscal Year - Preliminary

4.1 Implementation Cost Estimate

The following table summarizes estimated expenditures by type. Dollars are rounded to
the nearest ten.

Fiscal Year Type of Expenditure Est Low Est High

FY 2005 C&C Staff Costs $166,600 $326,200
FY 2005 HR Staff Costs $160,000 $240,000
FY 2005 FM Staff Costs $ 0 $ 20,000
FY 2005 Contingency, hardware, software $ 25,000 $ 50,000
Total Estimated Implementation Costs $351,600 $636,200

4.2 Maintenance Cost Estimate

The following table summarizes estimated recurring expenditures by type (e.g. hardware,
software licensing) on an annual basis.

Fiscal Year Type of Expenditure Est Low Est High

FY 2006 $ $
FY 2006 $ $
FY 2006 $ $
Total Estimated Annual Costs $ 0 $0

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5.0 Funding Sources

5.1 Non-Recurring Project Costs:

Source of Funds Status Amount

<dept> $
C&C $
Other <describe> $
Grand Total $0

5.2 Ongoing Support Costs:

Source of Funds Status Amount

<dept> $
C&C $
Other <describe> $
Grand Total $0

6.0 Schedule – Preliminary

Estimated start and end dates for each major phase of the project. Dates may overlap.
See glossary for project phases.

Project Phases Est Start Date (Mo/Yr) Est End Date (Mo/Yr)
Business Requirements July, 2005 June, 2006
(Phase 1)
Technical Requirements TBD TBD
(Phase 2)
HRMS Solution (Phase 3) TBD TBD

7.0 Assumptions / Notes

Assumption is that a project “go ahead” means performing Phase 1 and then considering
Phases 2 and 3 separately.

8.0 Implementation Challenges

8.1 Coordination Issues:

Changes to the systems and processes being assessed, particularly as a result of Civil
Service Reform will need to be integrated as they happen if the project begins prior to the
completion of CSR. If this project can be coordinated with Civil Service Reform, Phases 2
and 3 could benefit from the expertise of resources who are intimately familiar with the
University’s current systems.

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8.2 Success Criteria:

Key success criteria for the scoping study phase of this project include delivery of:
• comprehensive Business Requirements for an HRMS that will meet the needs of
the University community
• high-level scope of work and costing estimate for the technical requirements
phase of each recommendation and
• recommendations and a decision framework for the University’s executive
management to employ in selecting which option to pursue in order to meet the
UW’s HRMS needs.

9.0 Alternative Approaches

Phase I of this project will enable the University to have a comprehensive view of its
workforce management requirements. No matter what path is selected to deliver on these
requirements, whether incremental or comprehensive in nature it will be a path that is
pursued with the full picture in mind rather than a piecemeal approach. The current path of
adding more data, processes and rules over time to HEPPS in an attempt to make it
perform as an HRMS ignores the fact that it is not designed at its most fundamental level to
manage people. The status quo is inflexible, fraught with liability, expensive over time and
does not enable the University to manage the workforce that is the core asset to delivering
on its mission.

10.0 C&C Confidence Level

Confidence in the C&C estimates is:

Low ___ Medium __X__ High ____

Comments: If the lower level of staffing is funded then our confidence level is medium. It is
quite possible that the process would take longer than estimated to develop fully costed
estimates for technical requirements at the low end of the range. If the higher level of
staffing is funded then our confidence level increases as well. This phase is very doable
with adequate knowledgeable resources

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