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Retail detail: how Brazil’s largest employer successfully outsourced payroll



Introduction


Antonio Salvador is the former chief digital officer for GPA — a vast supermarket brand in Brazil. When he joined the HR team, he was astonished to find just how complicated, disjointed, and inefficient the entire HR system was.

“It took six months — six months! — for me to work out how many employees we had, and where they were. People weren’t getting the set-up they needed, or the benefits they needed, because nobody knew whose job it was or what system it was on or which service center was responsible. It was a big mess.”

Something needed to be done. And fast, because the Brazilian government was implementing something called eSocial.

“eSocial is a centralized system where all companies need to send daily information about their employees”, Antonio explains. “And if you do not send that data daily or if it’s not accurate, you’re going to pay fines. Our system was just so big and so messy that we didn’t have or couldn’t find this data. So, this was the cherry on top for me”.

Luckily, Antonio Salvador is an ambitious man who likes a challenge. He knew that outside help was needed, and he knew it had to come from ADP: “we just don’t have anyone else in Brazil who is strong enough and capable enough to handle GPA”.

To get people to support his plan, Antonio used two main arguments. “I said, we really don’t need another supplier; we are living in a situation where we really need a partner. And second, I explained that it was about simplicity. We were really looking at simplicity for the whole project. Because the environment is already complex enough”.

Eventually, they listened. And that’s how GPA began partnering with ADP.

 

 

The challenge


GPA is a big brand, with over 150,000 employees. During the project, the peak employee numbers hit 170,000. Taking into account legacy members, their health insurance covered close to 400,000 people. That’s a lot of people to manage in one country — a situation that gets even more complex when you note that these people are spread over almost 2,000 locations in an enormous nation.

That’s not the only thing that was complicating matters. “GPA is owned by a French group and, like any retailer, it grew through acquisition, so you can imagine the state of the legacy system”, Antonio says.

At the time of the project, GPA was going through a very high turnover period. It had three shared service centers covering 2,000 stores, which were hiring and separating from almost 5,000 people every month. This 40% turnover rate made HR’s job even more complicated than usual.

With the old and disjointed legacy system, it was taking up to 10 days for new employees to get the set-up and employee benefits they needed.

“And then there are fines — fines for error, for late terminations, almost seven million euros a year. That was the cost to run this operation. Seven million euros a year in fines.”

And then, there was eSocial to contend with. So, how did GPA and ADP get on top of this situation?


 

Outcome


“We went for the big-bang approach”, Antonio says. Over 18 months, ADP and GPA developed best-practice protocols and worked hard on a single, user-friendly app, which presented the team with some interesting issues.

“Only 30% of employees have access to a computer. And at that time in Brazil, we were still talking about this system being accessed through a desktop. But smartphones were big, so we had to convince everyone that an app was the way forward. That took some investment in tech and in training! But look at where the world is with smartphones now — we were so right to take that route.”

Ultimately, all that time and effort paid off. And Antonio is very pleased with the results.

“Today, we have one shared service center. It’s fully concentrated, with 50 staff who run the operation very smoothly. 50% of all the requisitions are done electronically. It’s a significant improvement.”

“All the benefits, everything a new employee needs to set them up — it’s done in hours, not weeks. It’s better for the employees and it’s a huge cost saving to the company.”

Reliability and stability are the main benefit for Antonio — not to mention saving millions of euros in fines!

“Now, we’ve got a reliable core system, which gives our managers all the information they need right then and there, across the board. So, they can make smart decisions and they can make them quickly.”

He was also pleased with how the development process went. “It was a very open and honest conversation. We have an open-book kind of partnership. And the result is that we now have this very smooth HR process across all of GPA in Brazil.”









































 


 
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