DHL – Updating an ageing payroll system

The payroll system for any organisation is business critical, but not necessarily viewed as a high priority. Often outsourced, there may not be the expertise in-house when it comes to updating an ageing payroll system, or it may be viewed simply as an IT project.

Background

DHL has nearly 50,000 employees operating out of over 500 locations and runs a 24-hour operation. It has grown through acquisition and transfer which adds to the complexity of a payroll system that has varying pay scales, terms and conditions, shift rates, overtime rates and expenses.

The support period on DHL’s outsourced payroll service was due to end, so the decision was made to implement a new payroll system from a new service provider. They had chosen the ResourceLink system from NGA. This new system had to cope with a high level of complexity across the business and provide flexibility and efficiency in payroll management.

i-Realise was brought in by DHL as an impartial advisor to help them to achieve the best value from their investment in the new payroll system. They needed to complete a smooth implementation, minimising disruption to the business and because they had outsourced their payroll management for many years, they did not have this expertise
in-house.

The key issues

  • This was a high profile change within the organisation, the management were keen to reduce the associated risks and avoid any disruption.
  • The company had a non-standard operating model around payroll, so new processes needed to be designed.
  • The payroll supplier was able to manage the technical aspects of the project, but the client needed help with defining their requirements, managing the business change and the relationship with the supplier.
  • There was a hidden side to the project, which was the huge amount of stakeholder engagement and management that was required.
  • DHL needed a full implementation plan for the payroll system, including planning all of the resources required.

The approach

i-Realise started with a requirements gathering exercise and a thorough ‘as is’ analysis of the client’s systems and ways of working. This involved examining the formal organisational structure and all of the diverse ways in which  each site or business area operated. The team at i-Realise followed the existing operational processes involving payroll to find out how they worked and who was responsible. This involved visiting various different operating locations as well as telephone calls to employees across the country.

The next stage was to work out where the client needed ‘to be’ at the end of the process. The i-Realise team defined the requirements of the new system and developed new payroll operating processes for the business. They then put together a clear change map for the organisation, so the client could understand how both the systems and business change would be delivered.

Communication

Communication was a major part of this change plan as in essence, i-Realise had to find a way of having a conversation with tens of thousands of employees. They identified the key stakeholders and mapped all the processes required. These key stakeholders were then able to disseminate information to all employees.

A training and communications plan was put in place to support the implementation and the i-Realise team were available to answer all questions from employees throughout the project. Answering them honestly and providing information to the right people at the right time, meant that employees were engaged with the project and the management was comfortable with how it was proceeding. A project can easily be derailed if employees feel threatened or isolated, so it was essential that they were informed and reassured.

Using their experience in payroll implementation, the i-Realise team was able to bridge the gap between the supplier and the client, ensuring that the client fully understood all the implications of any decisions made regarding the new system.

A structured testing programme was put in place for the new payroll system. As each phase was validated, employee engagement and confidence in the new system increased. It was then run in parallel with the existing system before going live.

Successful outcomes

  • i-Realise helped the client to implement the new payroll system successfully. It was updated to become more efficient and better suited to meet the needs of the business.
  • At ‘go live’ all staff were paid on time and correctly, with no fall out, which is rarely achieved in payroll implementation terms.
  • Crucially, everyone was fully engaged in the change process and the senior management had every confidence in i-Realise’s ability to deliver the implementation smoothly. The payroll system went live with very little fuss.

i-Realise were able to see the company from a different perspective and challenge the way the business went about its change programmes. Using their experience in payroll implementation combined with knowing how to deliver business-critical change into a complex organisation, i-Realise ensured a successful outcome. In addition, DHL has continued to use the change management and engagement approach developed for the payroll implementation elsewhere in the business.

Have a similar project?

“i-Realise have exceeded my expectations in bringing external specialism to the company whilst integrating
seamlessly within our organisation, to the extent that most of the business consider them to be our employees.
They have been instrumental in ensuring a smooth and successful implementation of a very complex payroll
system as well as helping us to employ best practice elsewhere in the organisation. We couldn’t have done it
without them!”

Margaret Rose, Programme Director and Sponsor, DHL

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