Direct Line insures its future with HR in the cloud

Insurer invests in new HR systems as part of divestment from state-owned RBS

UK insurance group Direct Line has opted for what it calls a "standalone, FTSE-grade HR solution" based in the cloud.

The home and car insurance group, which includes brands such as Churchill and Green Flag, is the UK's largest such insurer by number of policies, according to the company.

A new core HR management system from Workday is one of a range of best-of-breed systems being installed by Direct Line's HR department as part of the group's "preferred route" towards IPO in the second half of 2012, according to Mark Martin, the group's HR director.

Royal Bank of Scotland (RBS) was ordered to divest the Direct Line business in 2010, in the wake of the £45bn state bailout to prevent the bank's collapse during the 2008-09 financial crisis.

Martin told Computing that creating a new HR system for its 16,000-strong workforce, based in the UK, Italy and Germany, has been the priority for the group in advance of the divestment process, which needs to be completed by the end of 2014.

"The HR function was the most tightly integrated [with RBS systems], with two-thirds of it delivered by the RBS group," he explained.

He said that Direct Line was presented with the opportunity to build a strong, new standalone HR function from a single base, including new terms and conditions, contracts and benefits. A cloud-based solution was core to that decision, he said, with investment from the state-backed bank.

This is partly because an object-based system, rather than a relation-based one, gives Martin a single view of all the group's HR processes, he said. "It's all about configuration. You have to go for core processes. Let's focus on the employee experience.

"I was brought in to lead the separation and to create a bold new system. We obviously worked very closely with RBS IT, but with the overall strategy of creating a standalone HR system."

Martin, who joined the group in 2010 to spearhead the project, said that lower costs and speed of implementation prior to divestment were not the main drivers of the decision to go down the software-as-a-service (SaaS) route.

"It's cheaper, but it's like comparing apples and pears. The real advantage is the regular updates from Workday, versus the cost of upgrading from, say Oracle, PeopleSoft or SAP," he said.

The new system goes live in a fortnight.