Case study (UK): Premier Foods

Vicky Burr 21-Jan-2009

ROC helps Premier Foods standardize HR processes and systems across the business.

Introduction

As the largest food manufacture in the UK, Premier Foods is a company which houses ‘Great British Brands’ like Mr Kipling, Hovis, Oxo and Branston. Back in 2005, with a staff of 4500 people and a turnover of £700 million, the company was a much smaller concern than it is today. In the last three years, Premier Foods has embarked on a vigorous growth strategy, acquiring businesses like Campbell’s and Rank Hovis McDougall (RHM). The company now stands at around 18,000 employees with annual turnover in excess of £2.5 billion.

Challenge

Premier Foods’ acquisitive strategy signaled the need for technological standardization across the business. The solution has been an initiative called the Fusion program, which has focused on implementing an SAP Enterprise Resource Planning (ERP) system, including the Human Capital Management (HCM) modules.

Aligning the HR function has been a key element of the Fusion program. The companies Premier Foods has acquired include bakeries, canned goods manufacturers and mills, all of which operate different HR, time management and payroll systems. These disparate systems mean that the company has had limited visibility into its HR processes, to the extent that it has even proved difficult to extrapolate headcount.

As Mark Vickery, CIO of Premier Foods explains, “There was a mixed bag in terms of HR processes and systems in operation across the business. Whereas the original Premier Foods business had automated payroll and time management capabilities, other businesses used paper based processes. The challenge has been to standardize the systems across the business and conduct a significant change management program. We have employees who have never had to use clock in machines, for example.”

In terms of HR policy, there have been as would be expected, many differences that need to be reviewed and in some cases aligned. Some employees have been getting paid weekly, others monthly; some clock in, whereas others use time sheets. Other differences include some employees being entitled to advance holiday payment and variations in shift payments and overtime entitlements.  All these discrepancies needed to be reviewed.

ROC Solution

Risk mitigation and maintaining ‘business as usual’ were important considerations when Premier Foods selected ROC to work on the SAP HCM element of the Fusion program. ROC’s considerable experience in large scale SAP HCM implementations was one of the main reasons it was chosen, along with its Best Practice HR accelerated solution, which the consultancy developed in conjunction with SAP. The best practice approach meant the project was based on proven processes, so configuration time could be kept to a minimum and the time taken to test the system could be maximized to ensure successful delivery.

Phase one of the project dealt with the original Premier Foods business and 3500 employees and 10 payrolls spread across nine different sites. The back office solution focused on centralizing SAP payroll and time management, in addition to an HR agency labor solution that would give Premier Foods a much better insight into its use of temporary staff.

The next two phases, which are still underway, involve rolling out the same functionality across another 40 sites and five business units. The end result will be that the entire organization of around 18,000 employees will be migrated onto SAP payroll, time management and HR, as well as a new clocking system. A significant change management program is in place to educate the staff about the new policies and systems and to deal with the resulting organizational change.

Benefits

When the program reaches its conclusion in 2009, Premier Foods will have the transparency it needs in its HR operations to get a view of organizational management that didn’t previously exist.

For example, one of the key benefits has been the Daily Cost of Labor Report, which enables senior management to get an accurate picture of how many hours have been worked and the costs incurred, critical in helping to control overtime and temporary labor costs.

ROC’s Best Practice HR Solution has ensured that the design of the system and delivery of the project is of extremely high quality, which in turn means that it is a much safer option for Premier Foods, as any risks to the business are mitigated.

As Mark Vickery concludes, “It is extremely difficult to put a value on the SAP HCM program and ROC’s contribution in terms of ROI, but the return has been significant. It’s not all about cost reduction – there are lots of other intrinsic benefits. The project has had positive repercussions supporting other organizational initiatives.”