Report Tile

1. Human Resources Line of Business Performance Reference Model (PRM) Presentation to IT Performance Management Council July 20, 2006 Report Tile UNITED STATES OFFICE OF PERSONNEL MANAGEMENT

2. Agenda • HR Line of Business (HR LOB) Background • HR LOB Enterprise Architecture Overview • The HR LOB PRM v1 • Approach • Value • Workshop Methodology • Results • Lessons Learned • Questions

3. HR LOB Background

4. HR LOB Vision & Goals

5. HR LOB – Two Dimensions • Common Solutions • Address distinct business improvements that have a direct impact on HR LOB performance goals • Achieve economies of scale • Utilize shared service centers • Standardization • Solutions are developed through a set of common and repeatable processes and tools that are compliant with the Federal Enterprise Architecture (FEA) guidance

6. Concept of Operations (CONOPS) • The Shared Service Centers will take a phased approach to delivering HR services • At a minimum, all service centers will offer the same common, core functionalities • The solutions that operate at these service centers will be evaluated and recommended by a multi-agency steering committee that stresses scalability, interoperability, and portability • Shared Service Center solutions can be COTS or GOTS and will be selected on a competitive basis • Agencies will have choices when they shop around for the service centers that best meet their needs • The shared service centers will leverage “plug and play” architecture concepts

7. Shared Service Centers • September 2004 five agencies submitted proposals to OMB to be HR LOB Shared Service Centers (SSCs) • February 2005 OMB announced five “candidate” HR LOB SSCs • March 2005 OPM established a multi agency Technical Panel and Advisory Board to evaluate the SSC candidates from an HR perspective • August 2005 OPM and OMB announced the final selection of 5 HR LOB SSCs • October 2005 a Shared Service Center Advisory Council (SSCAC) consisting of five HR LOB SSCs and four Payroll Providers was established • Additional Federal and Private Sector SSCs may be announced in FY 2006

8. OPM HR LOB Program Director Co-Chair MAESC OMB IEE Portfolio Manager, Co-Chair MAESC HR LOB PMO HR LOB Multi-Agency Executive Strategy Committee OPM Ex Officio Seats CIO Council Liaison CFO Council Liaison Small Agency Council Liaison Federal Acquisition Council Liaison Budget Officers Advisory Council Liaison AGENCY REPRESENTATIVES HR LOB Governance Director, OPM CHCOC Chair E-Gov Administrator OMB Strategy / Policy, Planning & Oversight Requirements Board BRM Workgroup Management Improvement Program Requirements Work Groups DRM Workgroup PRM Workgroup User Requirements SSC Workgroup Configuration Control Board Indicates Inactive Governance Body Information Security Practice Workgroup SRM Workgroup] SSC Advisory Council / PAC Operations & Delivery Shared Service Center Shared Service Center Shared Service Center Shared Service Center Shared Service Center

9. HR LOB Enterprise Architecture

10. Results of the HR LOB EA approach • Agency consensus in a variety of areas regarding government-wide view • Common vocabulary for processes and activities • Management tools • Improved decision making • Basis for standardization and common solutions • Enhanced communication • Consistent with OMB’s FEA rationale • Alignment • Integration • Change • Time to Market • Convergence

11. The FEA consists of a set of interlinked reference models to facilitate cross-agency analysis & collaboration Core SRM - 2006 TRM - 2007

12. Business Reference Model Sub-functions

13. Target Requirements The HR LOB Target Requirements: • Focus on the common government-wide HR processes that may be delivered by shared service centers • Utilize the HR LOB Business Reference Model (BRM) for processes and activities that have been identified to move to SSCs • Identify a common view of the role of the SSC in Federal HR

14. DRM The HR LOB Data Reference Model (DRM): • Identifies data needed to execute BRM processes • Depicted at the conceptual and logical level – does not describe how the data will be implemented • Enables the government to communicate more accurately and efficiently about the purpose, content and structure of human resources data • Enables standardization for data descriptions, data context, and for data sharing • Reflects a future target

15. SRM The HR LOB Service Component Reference Model (SRM): • Uses FEA guidance to identify service components – potentially reusable self-contained business capabilities • Organizes service components by service type and service domain using FEA as a guide • Proposes a common view of service delivery • Identifies generic enabling technology required to deliver service components to customers

16. HR LOB Performance Reference Model (PRM) Approach

17. Purpose of HR LOB PRM v1 • Establishes a standardized set of measures based on Business Reference Model (BRM) processes against which to measure Human Resource Management (HRM) processes • Develops a series of measures to assess the performance of services offered by Shared Service Centers (SSCs) • Addresses the sub-function processes • Develops a set of normalized measures across the Federal HR community • Supports the objectives of Human Capital Assessment and Accountability Framework (HCAAF) • The HCAAF offers guidance and integration for transforming human capital management and describes the expectations that guide the assessment of agency human capital efforts

18. FEA guidelines define the PRM for Human Resource Management based on the HR LOB Business Reference Model (BRM)

19. Human Resource Development Performance Mgmt Compensation Mgmt Separation Management Org & Position Management Employee Relations Labor Relations Staff Acquisition Benefits Mgmt HR Strategy Improved Management Operational Efficiencies Cost Savings/Avoidance Improved Customer Service The strategic objectives span Human Resource Management and the HR LOB sub-functions • The strategic objectives address how the HR LOB contributes to the Management of Government Resources, one of the FEA measurement areas • The PRM describes how each sub-function contributes to the strategic outcomes • The BRM is the validated scope for Human Resource Management

20. The PRM is derived from the BRM and target requirements; it forms the basis for SSC service level agreements BRM HR LOB PRM Service Level Agreement Target Requirements

21. Development Process

22. Work Session Process

23. 1 2 3 The recommended PRM measures are the result of four levels of analysis • First level provides • Metric definition by activity • Alignment to measurement characteristics • Second level provides • Consolidation of common metrics • Alignment with design principles • Highlights metrics specific to the potential SSC roles • Third level provides • Alignment to HCAAF’s Human Capital ‘systems’ and/or Business Results • Final level addresses manageability • Selection of the ‘most relevant’ measures 4

24. First step: Defining relevant metrics • An activity template was presented to the PRMWG during the working sessions • The PRMWG will brainstormed to develop the metrics for each activity, including definitions • Agreed upon a few (up to 4, but at least one) potential measures for each activity • We evaluated potential measures against the Measurement Characteristics • What questions are answered? • Do we have a standard definition of the metric? • Are these sound metrics for this process? • Measure the output • Measure what’s important • Do these metrics fulfill the measurement characteristics?

25. What questions are answered? Which Strategic Objective does this measure address? Do these measures comply with the design principles? Could this measure apply to SSCs? Second step: Evaluating the metrics

26. Third step: Aligning measures to outcomes • What question is answered? • How does the measure align to HC and/or agency results?

27. 1 2 3 Vol. 1 Scope (plus Personnel Processing) Final step: Provide a manageable set of standard measures The alignment with HR LOB Strategic Objectives provides alignment to business results

28. Results

29. Measurement Indicators Types of indicators for core areas • “Tip of the Iceberg” – Indicators that reflect the health of the process to deliver results • If the measure is not in the expected range, or changes drastically, additional analysis would be performed to understand the causes of the change • Additional analysis may indicate an agency process issue, an SSC process issue, or a issue between the agency and SSC • Transactional measure – Indicators track time or accuracy regarding completion of a task • These measures are typically relevant to SSC service and/or processing

30. Common Themes in Compensation Management Measurements • Customer Service • Measures that track transactional procedures which can reflect an organization’s ability to provide customer service. • Timeliness • Measure that track how long it takes to complete a task. The intent of these measures is to evaluate efficiency. • Quality • Measures that track errors over a period of time. By tracking quality, customers can better understand the impacts of delivering HR service efficiently and could affect the perception of employee-customers. • Cost • Measures that calculate the cost of a process or transaction. Cost metrics are essential in determining long-term benefits of new technology initiatives.

31. Compensation Management Measurement Indicators

32. Common Themes in Benefits Management Measures • Customer Service • Measures that track transactional procedures which can reflect an organization’s ability to provide customer service • Timeliness • Measures that track how long it takes to complete a task. The intent of these measures is to evaluate efficiency • Quality • Measures that track errors over a period of time. By tracking quality, customers can better understand the impacts of delivering HR service efficiently and could affect the perception of employee-customers • Cost • Measures that calculate the cost of a process or transaction. Cost metrics are essential in determining long-term benefits of new technology initiatives

33. Benefit Management Measurement Indicators

34. Common Themes in Personnel Action Measures • Self-Service • Measures that track the availability and usage of self-service applications. • Customer Service • Measures that track transactional procedures which can reflect an organization’s ability to provide customer service. • Processing & Workflow • Measure that track how long it takes to complete a task. • Quality - Measures that track errors over a period of time. By tracking quality, customers can better understand the impacts of delivering HR service and could affect the perception of employee-customers. • Evaluation & Compliance • HR and SSC ensures that personnel actions are compliant with applicable standards, policies, rules, and regulations.

35. Personnel Action Measurement Indicators

36. PRM Report Results • Developed measures across three sub-functions • 17 for Compensation Management • 11 for Benefits Management • 9 for Personnel Actions • Some measures were recommended for use with more than one sub-function • While the majority of measures had SSC involvement, some measures are relevant only to agencies. • Measures are being leveraged in the SLA process development

37. Strategic Outcomes People Processes and Activities Customer Results Mission and Business Results • Processes and • Customer Technology • Activities • Results VALUE Other Fixed Assets Mission/ Business Results: As the cost of HR is decreased, those savings can be reallocated to support agency mission objectives. Alternatively, cost savings may result in reduced agency budgets, thus passing benefits on to taxpayers. Line of Sight What: Technology What: Process/ Activity What: Results What: Strategic Objective IT Investment: Self-Service application BRM Business Area: Personnel Actions PRM Measurement Indicator: Self-Service Usage HR LOB Strategic Objective: Cost Savings/ Avoidance Cause And Effect Cause And Effect INPUTS OUTPUTS OUTCOMES Line of Sight Example

38. Value of the PRM v1 • Provides a common language and set of definitions that can be used to accelerate the development of Service Level Agreements (SLAs) between agencies and SSCs. • Creates a set of measures that are aligned to business results. • Agencies can use to validate HR contributions to agency mission-critical results. • Provides an opportunity to highlight significant process improvement opportunities. • Provides agencies with an approach for developing measures that provide visibility to the business benefits of capital investments.

39. Lessons Learned • Prepare to discuss many measures – hundreds of measures were considered, but didn’t meet characteristics threshold • Start small – agencies agreed with the vision of developing a small, manageable set of measures that are likely to evolve as inputs and outcomes are aligned • Prepare for further analysis – agencies are interested in decomposing the definitions to standardize cost information

40. Questions Kunal Suryavanshi – HR LOB PMO Kunal.Suryavanshi@opm.gov 202.606.1273 Tim Biggert – EA Team Leader Timothy.Biggert@opm.gov 202.606.4185 Melanie Meador – PRM Lead mmeador@us.ibm.com 703.633.4279