AI Roadmap, Efficiency & Quality Matrix, Post Merger Integrations with Nina Kirr

Thomas Kohler:
Where did you see on your metrics in terms of hours save plus quality increased? Where do you see the processes with the biggest impact so far it is.

Nina Kirr:
Talent acquisition, for instance, CV screenings or candidate interview scheduling. There is a lot possible with automation how to scale it more efficient Then we see that in P and C operations for reporting for self service for our employees. We see that also for talent management or employee service feedback. There are a lot of possibilities with automation, how to structure that better, how to gain via AI. And here AI really is an enabler, supports you with actions how actually create then or draw from the feedback actions that you can work together with the managers and people to really then increase better solutions at the organization.

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Thomas Kohler:
Today’s guest, Nina Kirr, SVP President of People and Culture at Proalpha, a very successful tech company here in Germany. And maybe Nina, I’m really glad that you’re here and we start with an introduction about yourself.

Nina Kirr:
Yes, thank you very much Thomas. Thanks for the invitation and for having me. And I’m happy to start with a short introduction. So as you said, I’m Nina, I’m SVP People and Culture at Proalpha. We’re a leading ERP software company and we’re providing our services for mid sized industrial companies, primarily with a focus on the Dach region. Today the Group consists of 12 specialized software units with more than 2,400 employees and we’re operating in nine different countries and we’re supporting thousands of customers, driving digital transformation, operational excellence, long term growth with our products that they use. To myself, a few words might be interesting as well. So I’m with the company for almost three years and when I stepped in that role, I inherited a function that was still, I must say, focused on administrative HR tasks.

So my mission was to transform into a modern strategic people and culture organization on the one hand, that connects a diverse group of companies that we acquire through acquisitions and to combine them with a shared framework with common principles, with regular collaboration across countries and the business units. And today my team and I, we’re working on one of the biggest opportunities I think that many HR leaders and teams are facing and that is demonstrating real return on investment through technology use. And AI plays a very important role here and we have a situation that we were forced to change our HCM system in a very short way. I will share that in a second in more detail. And that really brought us in a situation to completely rethink our tech stack and how we can actually bring automation and AI into our people & culture department.

Thomas Kohler:
Can you share why you had to change so short notice?

Nina Kirr:
Sure. So that was, I think, a very unuseful situation. But actually our service provider decided to end the corporation for strategic reasons. We have in our Proalpha Group our own HCM product. And for strategic reason, the service provider decided that they do not want to have a customer that are actually having their own HCM product in their portfolio.

Thomas Kohler:
Okay. Because of competitiveness, for instance. Okay. Okay, understood. Okay. That’s really an ad hoc scenario. Then what was then the timeline for you and what were the implications?

Nina Kirr:
Yeah, so the time was quite tough because the termination period was six months. So we had six months receiving the termination and making sure that we go live with our new product. We’re actually short before go live because actually Go live is planned for January. So we’re in the final steps. And as I said, it brought the opportunity to really rethink our own tech stack. It brought secondly the opportunity that we can use our own products in the group now, our product persistentizaware. And we will add or have already added an external ATS system to combine the tech stack that we’re using. And what was also very important is that with creating a new tech stack, we got the chance that we really. But now a structure with a more cleaner data would say with more harmonized processes and which really builds a good foundation for automation. And that is very, very much important for us.

Thomas Kohler:
What data did you harmonize? Is it the classical stack of recruiting data with the HR data, with maybe some payroll data?

Nina Kirr:
We started actually a bit earlier. So we started first of all with our infrastructure. So. So our HCM system was implemented, I think it was seven years ago. And as we’re growing so fast via acquisitions, we have now a different situation in the company. We have aligned much more how controlling is actually looking at the business and reflecting that in our new HCM box structure, we have also added more opportunities how to actually look at the organization from a metrics perspective, from a controlling perspective, from a legal entity structure, from an employment structure. And we have then harmonized processes to the needs that we see in the organization with the different entities we have, we’re able to include also works council processes, which is important for us as well to reflect this. And yes, we have included payroll processes, have also aligned that to be scalable and integrate that for the different countries as well and it will make us much more powerful in the future and more efficient.

Thomas Kohler:
How many companies did you acquire?

Nina Kirr:
We have acquired, we’re now a set out of 12 companies, we acquire per year, two to four companies on average.

Thomas Kohler:
And what is the focus there? Is it varying over time or do you have a certain strategy?

Nina Kirr:
We do have a strategy. So our core product is ERP. That is really where Proalpha has been established. 30 years ago and seven years ago we took the decision that we want to change the strategy and that we not only want to grow with our own ERP product, but acquire solutions that will add to our ERP product like hcm, like CM solutions, like finance solutions. Everything that provides a benefit to our own ERP product to our customers. And we’re having always 100, 220, I would say assets in the pipeline where we’re looking. Okay. What makes sense to add and what is important.

We have created lines of businesses. So for teaserware parasis quibly this is our HCM product. It’s their own line of business. We we have financial products that are supporting the financial needs of our clients and we always looking when we acquire new companies, which line of business does this fit best and what are the needs that we see at our customers? And that brings the advantage that we have a high cross selling potential for all our ERP customers that we already have. But we have also a high opportunity for the acquired companies that they can do cross selling. And we are more diverse in our business when we see for instance at the moment for automotive bit challenging the situation. And we are more diverse with our products to tangle different industries.

Thomas Kohler:
Wow. Okay. And how do you decide if you want to integrate a company into your overall structure or you just keep them independent? Do you have an one size fits all approach or do you just also determine case by case?

Nina Kirr:
We have a strategy. I would say it’s a light integration approach. So what we do is that we keep the brand because most of the time it is a USP that we acquired brand. We focus and keep the go to market functions in the business unit and we integrate in a shared service model the general and admin functions. I would say like people and culture like it like internal controlling, finance, legal, et cetera. And that way we combine both of best worlds that especially for people like culture. When we acquire companies that are usually smaller than Proalpha so they’re usually around between 30 to 120 employees. They always very open to get a professionalized people and culture team with the benefits, with the talent structures, with the compensation structures and we support their teams and include our formats and processes to that new acquired companies.

That’s one aspect and the second one is that we see that it’s very important that we are able to Create a common culture that means we do respect and we need the individual cultures that we acquire when we acquire companies. And at the same time we need to build a framework that every single employee makes themselves familiar with, also an employee of the Proalpha Group. And therefore it is helping to have common processes for tele development, for payment development, for celebrating together to actually create that framework. And that is how we do integration.

Thomas Kohler:
And how long does an integration take for you that you say it’s done, it’s maybe never done, but when you say, okay, it’s good enough.

Nina Kirr:
Never finished, yeah, it’s a transformation. That’s right. But we usually start quite after the closing of the deal so that we get in contact with the relevant stakeholders. So in my part, it’s usually the HR responsibility or whoever owns HR. And it’s usually a process of six to 12 months, depending how large they are, what they have and what the needs are. We’re always checking what is the business situation and the needs of the business. We do not want to interfere or risk any kind of business because of the integration activities. But usually we have the shared services rolled out after 12 months. The talent management process take a bit longer because it requires certain standards that we integrate together with the acquired companies time after time.

Thomas Kohler:
Okay, interesting. You shared that you are also automating a lot and trying a lot of AI use cases. Can you maybe share what was or is on your automation in the AI roadmap?

Nina Kirr:
Yeah, sure. Yeah. So yeah, what did we do? So we had, we were sitting down after that HCM situation occurred and looked very critical at our tech stack. And we said, okay, we need a roadmap here and we need clear milestones how we want to proceed and what we want to achieve. So we have a clear focus on talent acquisition because there are a lot of requirements, competitive tasks where automation and AI can help on PNC operations or everything, which is a transactional business, and on analytics and decision support. What we do is, and what we have created is that we measure really the return on investment that is very important for me. Return on investment and KPIs. So we really measure the saved hours in FTE equivalent and we also measured service quality improvements because that is also what it’s about.

We want to have happy customers, which are our managers and our employees. How do we approach when we integrate the automation solution? So what we do is that we lead the selection of the tools that we need. But we have a strong support from our IT department, which is very important. So they actually ensure together with US that we select solutions that are then really based on our needs, but also guarantees that technical quality, security and the integration in our existing tech stack in the company will be successful. And what we’re very clear about, and that is always important for me to say is that AI is for me, not the destination. AI is for me the enabler inside a broader automation roadmap. You need firstly ensure balanced processes. Then start with automation and then add AI and that is really the key for success for me to really integrate AI successful in the world.

Thomas Kohler:
And where did you see on your metrics in terms of hours save plus quality increased? Where do you see the processes with the biggest impact so far?

Nina Kirr:
It is talent acquisition, for instance, CV screenings or candidate interview scheduling. There is a lot possible with automation, how to scale it more efficient. Then we see that in PNC operations for reportings, for self service for our employees. Or we see that also for talent management or employee service feedback. There are a lot of possibilities with automation, how to structure that better, how to gain via AI. And here AI really is an enabler, supports you with actions how actually create then or draw from the feedback actions that you can work together with the managers and people to really then increase better solutions at your organization.

Thomas Kohler:
Yeah, definitely. What I also see is a very great increase in reporting and creating certain reports from unorganized data. What you may be in the past you would need to draw an export, then you need to manipulate the data in a certain way that you can create a chart or something. And this is what I see also as a very big also what you see. But also this is also something additionally what I see that reporting can get way more easier and faster and pragmatic with just throwing a certain data source that can be unorganized into a tool. And then it’s organizing it for you very, very fast. And also very simple through prompting. I see this very often through our note takers we use, but also through our reporting in terms of hires we made and so on, that you could just prompt and say okay, what are the number or what are the hires we made in a certain sector, for instance in the IT professional service space in Germany, for for instance SAP integrations. And then you get a list of candidates and then otherwise you would need to filter, you need to build a list and so on. And this is really interesting for me, especially if I’m talking to customers, for instance, who also maybe sometimes some benchmarking data. This is really powerful because in the past it would take hours of preparation and sometimes now it can Happen live in a call while prompting.

Nina Kirr:
Absolutely agreed. And that is also something I think which is for HR so important because I mean you will always get the attention that you need and to say in the C level if you have really proof of your numbers, right. And you have arguments that you can fill with figures and even, especially I mean if we’re talking salaries increases and everything, that’s also very, very powerful when we think about copilot that they can actually access your company data. You prompt there something and get in a second perfect, not perfect, but almost perfect results. And you can then add additional questions to get the one or the other tweak that you really need to present. And that is something which is absolutely powerful. I totally agree.

Thomas Kohler:
What I really like in your style is the clarity on how you describe things, the strategic perspective and also the commercial perspective in an people and culture function. Now I would be really interesting on what is your and your C levels or CFO and CEOs relationship perspective towards the HR budget because often I see that this is just seen as a cost center and then they don’t have a say and so on. And then they never get out of this say perspective where it’s not really a value adding function, it has to be done. And this is I think not a good state of people and culture. Can you share some insights or experience from your end?

Nina Kirr:
Sure, yeah. And I must say yes, it’s always a challenge for me as well. But I think we’re making good progress here. So I’m in the, in a very good situation that our C level, our CEO and our cfo, they do understand that we’re in software and a people business and that it’s all about the people and that actually the people are the ones that bring the results and the success of the company. So they do understand that it’s very important that we have a strong invest in our people and also in the culture. And that’s why how it works for us is I get a budget and I can fill that budget with the needs that I see. I get budget additionals if I think that they’re necessary. What I need to do then is and that we’re coming back, I really need to present a business case.

I need to show why I believe that it’s important to do what are actually the efficiencies that we have. And ideally I have to present that in numbers and in figures. And what is the benefit for the company and the business. Exactly what you just said. And if I’m able to present that then we’re having usually an alignment that is the right way to proceed and I do get the budget. On the other hand, to be honest, we have sometimes challenging situations. I’ve experienced that where we need to do budget restraints and everybody. And that is for people in culture, the same needs to contribute to debt.

So yes, sometimes we need to challenge critical our budget and have to make cuts off. But we always make a decision here. What is important for me is that I have overall the backup from my C level, that they understand that the function is important and we need to invest here.

Thomas Kohler:
And how did you get there? Was it always like that or did you build that reputation?

Nina Kirr:
I think I. Yeah, I was part of it, I would say to build that reputation. So what really helps is, as I said, showing figures and numbers. We have a very low attrition rate, it’s below 4% at the moment, which is for the software industry, very, very low. And I’m talking about voluntary attrition. And that has even since I’m in the company, declined from 8%, which was already low. But we are constantly moving in a good direction and we are doing feedbacks, we’re receiving positive feedback, we’re having good communion rate where they see and they have understood that if we are able to retain our talents that we can save costs a lot. I mean, everybody knows you better than me.

I believe how expensive it is actually a valuable source, valuable employee to actually, yeah, costs much more. And also it’s hard to build up that knowledge again. So yeah, it was time over time for the different processes and the feedback they see and then it actually works.

Thomas Kohler:
Nina, therefore I have a really good example for you. We are also a service company and we don’t have our own software or something, right? But let’s say I get a monthly executive summary from my finance team on the productivity per employee, also financial productivity per employee. And sometimes when there is somebody leaving the company, then I’m always looking at the lifetime productivity. And I see the longer people stay, the higher, not just the absolute number is because, okay, the longer they stay, the longer they are productive, the longer they are profitable. Of course the number is higher, but also in percentage. If you compare it, you can see that the longer they stay that the increase in productivity at some point, of course has a ceiling, but is increasing over time until year one to two and then it stays a bit of like flat but consistent. And I had this year and last year two cases where we in the probation period ended or the person just rejected and left and There we saw a negative impact on the productivity as well. And it just cost money if somebody leaves after one year.

It’s not ideal because you never get in this leverage phase. So I see how much it costs in terms of people leaving the company early. Also the context that is lost, that is not just considered there. It’s just a financial perspective. But I really always see it black and white in front of me and just try to focus on retention and with our incentive program and so on. And when companies do this right, I think they really have the ability to make a difference, especially in the service field as well, because a lot of things are happening also through relationships and so on. And there you can see a big leverage and momentum effects that are also not measurable. So that’s definitely the case.

Nina Kirr:
Yeah. And that actually brings us back to automation and AI in terms of retention as well. Because I do see at my example earlier screenings, we’re receiving more than two and a half thousand applications per month. So somebody needs to look at all these applications and the cvs. And I think if I have the capability to reduce this repetitive kind of boring task and free up that space, that those people can actually create more valuable task and coach and work closer with the hiring managers together. That does always does also something do with retention. We are helping to retain them, developing the people with that. And I think that is something that is also an important aspect.

At the same time, we need to balance that. We do not ask for too much at the same time from the people, that we help them to get there, that we train them, that we get feedback. That is an important aspect. But overall I think it’s a fantastic chance for the whole team to grow and develop.

Thomas Kohler:
I also saw on a post from Alex Meier in your team that I think you were also winning the Employer Branding Awards or something.

Nina Kirr:
Yeah. As Alex received that as employee Branding Manager of the Year. Yes. Deserved, I must say!

Thomas Kohler:
Yeah. Great. So what contributed to that?

Nina Kirr:
Yeah, so that was one of the projects I would say that I soon started after I joined Proalpha. I said, okay, we need to work on our employer brand. And what is very important for me was we always had a quite good repetitive or a brand external. But what was for me very important was to remember and remind our people inside our employees that we’re actually quite a good employer, that we have interesting benefits, career opportunities. And actually the project was for me even more about reputation inside than external. So we did a project where we really integrated employees from all our business units, management. We did Workshops and we created and worked what is actually the value proposition as an employer that we have. And from that together we created our strategy and our claim, which is Pro U where we said we really want to put the people at the center of what we do at Proalpha because as I said, we are in the people business.

It is about our people to being successful. And Alex, our brand manager and talent acquisition manager, she together with the team actually created the entire content about it. Let the workshops. We did communication internal. We have worked closely with our employees. We did a complete rebranding of our career website which was also received very, very positive external, but also internal. And that is now a strong part of our PNC DNA and of the company, our Pro U employer brand.

Thomas Kohler:
I really need to get her on the show for that as well because I think that’s really, really interesting. Yeah. Okay. Is there anything what you could give our audience as learning or as a main learning from your perspective when they want to automate or do something, what you did with the AI roadmap, efficiency, quality.

Nina Kirr:
I think just start would be my advice. It might look very big, but just sit down and start and you can start small. Measure an impact of one process. Make sure that you balance them first, as I said, then invest in smart automation and then at AI and then share that story. It’s very important that we in HR people and culture also share the stories and success so the people hear that. And what is also important, I think very important to get the team on board. It is not about replacing people, automation and AI. It’s really not about it.

It’s more about focusing the human side of HR and making it more important because it actually frees up more time to focus on the really valuable part of HR of coaching, consulting, supporting leadership, building, fostering culture. And if you consider this, I think you will be certainly successful in being or increasing automation and AI.

Thomas Kohler:
Great. Thank you so much for your time.

Nina Kirr:
Thank you Thomas, very much. Was fun and I wish you a fantastic rest of the day.

Thomas Kohler:
You too.