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					Is Your Server Serving You?




             Al Doran, CHRP




                          www.pmihrm.com
What is the new Technology in HR?

   24/7 Access

   Access by both Managers and Employees
    –   Those who need it


   Seamless – integrated with other Business
    Applications

                                    www.pmihrm.com
Why Technology?

   Reduce Costs
   HR Metrics – Headcount
   Instant Access – Real Time
   Business Decisions and Communications
   Global Economy




                                 www.pmihrm.com
                      Key Findings
            Recent CedarCrestone Survey

   Workforce technologies and service delivery
    approaches growth enable HR transformation
    –   All workforce technologies use continue to grow
    –   Outsourcing usage is growing
    –   Organizations blend high-touch and high-tech service delivery
   Results are significant
    –   Transaction and compliance cost reductions of 25% to 75%
   Success factors
    –   A solid business case
    –   Business process improvement
    –   Change management

                                                 www.pmihrm.com
              CedarCrestone HCM Blueprint
                           #8: CedarCrestone HCM Blueprint

                                Portal Framework                 Performance Excellence
                                                                 Service Delivery Excellence
                                                                 Administrative Excellence
  Help Desk
  • Call Tracking              Identity Management
  • Case Management            • Single Sign-on



       HR Knowledgebase                                      Self Service Transactions
                                     Analytics               • Native ERP
                                                             • Third-party Vendors

SCM
                                 Data Warehouse                   Strategic HCM Apps
      CRM                                                         • Recruiting
                                                                  • Competency Mgmt
            FIN            Core HRMS/ERP foundation               • Learning Mgmt
                          Data for Roles, Personalization,        • Compensation Mgmt
                                   Position Mgmt                  • Performance Mgmt
                                                             www.pmihrm.com
                  All Applications Grow In Use
                      Many Up 50% or More
                                                   Trend in Application Usage, Budgeted,
                                                           and Planned Worldwide
Employee Productivity Applications
                             2007

                             2004
 Manager Productivity Applications

                             2007
                             2004

         Strategic HR Applications
                             2007

                             2004
              Measure/Plan Talent
                             2007

                             2004

                                    0%                    20%                     40%                     60%               80%   100%
                                            In Use
                                            Budgeted within Next 12 Months
                                            Planned for Next 36 Months
                                                                                                             www.pmihrm.com
                                     Source: CedarCrestone 2005 Workforce Technologies/Service Delivery Approaches Survey
                                  Figure 1. Licensed Customer Share for Companies With More Than 10,000
                                  Employees




* = Gartner estimates

Source: Gartner (February 2008)




                                  * = Gartner estimates

                                  Source: Gartner (February 2008)


                                                                                                     www.pmihrm.com
      Years to Achieve Payback Faster than
         Expected with Most Solutions
                                       #33: In-house Solutions: Payback Achieved/
                                              Payback Expected – Worldwide
                                                                                                                        Years
                                                                                       Achieved   Years to    Not Yet   When
                                                                        Years in         ROI      Achieve    Achieved Payback is
                                                                         Place            %       Payback      ROI     Expected
 Core HR Record Keeping System
    HR Management System                                                    6.6          35%        3.1        22%        4.1
    HRMS Upgrade                                                            1.8          24%        1.1        27%        2.4
 Service Delivery Solutions and Applications
    Call Center Technologies                                                3.4          16%        1.1        18%        1.9
    Employee Self Service                                                   2.7          42%        1.3        20%        2.3
    Manager Self Service                                                    2.3          31%        1.2        31%        2.4
    Time and Attendance                                                     5.5          36%        1.6        18%        1.2
 Strategic HR Applications
    Web-based Recruiting                                                    2.4          22%        1.6        24%        1.8
    Web-based Learning Management (excludes content)                        2.4          15%        2.5        18%        5.0
    Performance Management (appraisals, goal alignment)                     3.9          28%        1.6        17%        4.0
    Succession Planning                                                     2.5           9%        1.0        17%        3.0
    Compensation Management                                                 3.3          24%        1.7        18%        3.3
 Measurement Solutions and Applications
    Data Warehouse (for HR)                                                 3.5          29%        2.1        20%        2.9
    Workforce Analytics (including scorecard)                               1.4          11%        0.6        21%        3.0

Source: CedarCrestone 2005 Workforce Technologies/Service Delivery Approaches Survey
                                                                                                   www.pmihrm.com
What does the Future Hold?

   Dramatic shift away from Data Input and
    Maintenance toward data interpretation.
   Shift to technology applications for most
    employee needs and questions
   Increased outsourcing
   Call Centre operations

       And more…


                                      www.pmihrm.com
More on the Future

   More demands on Human Resources
    –   Shorter time frames
    –   Clients will expect Metrics
    –   Instant access to data by management
   HR will be champion of change




                                         www.pmihrm.com
       Evolution -Application
       Technology



                                                Service
                                               Oriented
                                              Applications

                                 Internet
                               Applications


               Client-Server
               Applications


 Mainframe
Applications



                                     www.pmihrm.com
Typical Web Based Application




                                www.pmihrm.com
Typical Webserver Interface




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Typical Security Architecture




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Web Based Systems

   As an HR Professional:

    –   Do you really care how this all works?
    –   Or, are you more interested in that it works?




                                            www.pmihrm.com
Does your HRMS do what you
want it to do?

   Does it maintain the records on all your
    employees?
   Does it provide you with the management
    reports you need to do your job?




                                    www.pmihrm.com
Does your HRMS have?
   Real time communications w/ employees
   Newsletters
   Job postings
   Training
   Employee data to managers
   Sign up events, training, etc
   Polls and surveys
   Policies online
   Forms
   Benefits enrollment

                               www.pmihrm.com
    Comprehensive data


     –   Single source of employee data
     –   Staffing issues (vacancy, approvals, hiring dates)
     –   Sharing of data
     –   Reporting
     –   Data access
     –   Skillset tracking
     –   Applicant tracking
     –   Data analysis
   Better, faster, more accurate data
   Data security
   Feeds to finance, budget, payroll, security, etc
   Customized reports
                                                     www.pmihrm.com
                                                                                 Components Of -HR   e
                                                                                  HR Data Warehouse/Mart
                                  MSS                                         Web           Web           Outsourced
                                                                            Recruiting    Training       HR Functions

                                                                 Position Mgmt             HR System




                                                                                                                        Middleware
Corporate Portal




                                         Third Party Reporting
                   HR Portal




                                                                                                                                     Legacy
                                                                                              Payroll                                Systems

                                                                                         Time Management
                                   ESS




                                                                                 HR Communities Of Interest


                                               Workflow & Business Rules                       Directory
                               Transactions & Information Flows Within a TCP/IP Web Environment
                                                                                     www.pmihrm.com
So what are our options in 2008?

   Traditional
    –   Web based
    –   Hosted internally
            Need IT support around the clock
            You own the servers
            Ongoing cycle of major upgrades

            And,



                                                www.pmihrm.com
New Options

   Not on your servers
    –   ASP
    –   SaaS
    –   Hosted




                          www.pmihrm.com
ASP – Application Service Privider

   ASP: Long Gone or just re named?
    –   a third-party entity that manages and distributes
        software-based services and solutions to
        customers across a wide network.
    –   ASPs are a way for companies to outsource some
        or almost all aspects of their information
        technology needs. They may be commercial
        ventures that cater to customers


                                           www.pmihrm.com
ASP continued

   (Application Service Provider) Hosted software contractor. An
    ASP operates software at its data center, which customers
    access online under a service contract. The first wave of ASPs
    were application outsourcers, who hosted software packages
    from established enterprise software vendors such as SAP,
    Peoplesoft and Oracle. They are being superceded by a larger
    group of 'web-native' or 'net-native' ASPs, who have developed
    their own software, often using open-source platforms such as
    Linux, Apache and Perl, specifically for delivery as a hosted
    service.



                                                  www.pmihrm.com
More on ASP

   "Application service provider" is remote
    software that you access through a web
    browser. Instead of installing megabytes of
    software on your local C drive, you simply rent the
    use of some ASP software that exists elsewhere on
    the Internet. You never really own ASP software, you
    borrow it for a fee. Hotmail is often used as an
    example of an ASP.


                                          www.pmihrm.com
SaaS 1.0 Hosted / ASP-based
applications

   The first generation of SaaS witnessed the meteoric
    rise and catastrophic demise of the ASP (Application
    Service Provider) market. The early hosting/ASP
    models were based on the ASP purchasing a
    restricted use perpetual license from the software
    vendor and then providing subscription-based
    offerings to their end customers. ASPs offered
    primarily packaged applications targeted at SMB
    market.


                                          www.pmihrm.com
SaaS 2.0 “Pure” SaaS Applications

   is reaching a stage of maturity. This version of SaaS
    offers a complete range of functional and
    departmental applications such as CRM, ERP,
    Financials, HR and more. The applications are
    mostly developed for SaaS (“ground up”/Web
    native). These apps typically have a shared code base and a
    one-to-many delivery model. The pricing is driven by a lower
    cost subscription, which includes support, rapid deployment,
    and easy-to-use functionality. Thus our SaaS model creates
    economies of scale for software vendors and also enables rapid
    growth.

                                                 www.pmihrm.com
SaaS 3.0 Hybrid SaaS Applications

   SaaS 2.0 focused on the small and mid-sized
    business markets. SaaS 3.0 is emerging with
    the adoption by Enterprise clients of the
    SaaS capability.




                                   www.pmihrm.com
SaaS Growth

   By 2010, Gartner predicts that 30 percent of
    new software will be delivered via the SAAS
    model. In a report in March 2007, Gartner
    Inc. estimated that the global Software as a
    Service (SaaS) market will grow to $19.3
    billion by 2011, tripling in size from the $6.3
    billion it was in 2006 .


                                       www.pmihrm.com
What is SaaS?

   Software as a service (SaaS) is a model of software
    delivery where the software company provides
    maintenance, daily technical operation, and support
    for the software provided to their client. SaaS is a model
    of software delivery rather than a market segment; it assumes the
    software is delivered over the internet. Software can be delivered
    using this method to any market segment, from home consumers to
    corporations. The term "SaaS" was coined by John Koenig for the
    SDForum Software-as-a-Service Conference in March of 2005 and
    has become the industry adopted reference term, clarifying and
    replacing the earlier terms "On-Demand" and ASP (Application Service
    Provider).

                                                      www.pmihrm.com
How does SaaS differ from ASP?

   The reason for moving away from the term ASP or
    application service provider is that the ASP
    generation was merely traditional client-server
    applications with HTML front-ends added as an
    afterthought. These applications were hosted by
    third-parties who ordinarily did not have application
    expertise, but were only managing servers. Because
    the applications were not written as net-native
    applications, performance was poor and application
    updates were no better than self managed
    applications..
                                           www.pmihrm.com
ASP to SaaS continued

   By comparison, current net-native SaaS
    applications or independent portions are
    updated regularly, many daily.
   The focus in SaaS is more on what the
    customer wants rather than what the vendor
    could give as was the case in an ASP.



                                   www.pmihrm.com
Continued

   Early SaaS approaches were application service
    providers (ASPs) who ran a turnkey application on
    behalf of their clients. But ASPs generally did not
    build the application themselves; rather, they took an
    off-the-shelf application (such as HRMS).




                                           www.pmihrm.com
Drivers for SaaS

   Everyone has a computer
   Applications are standardized
   Many SaaS providers allow a wide range of
    customization within a basic set of functions.
   A specialized software provider can target a global
    market
   Web systems are reliable enough
   Security is sufficiently well trusted and transparent


                                            www.pmihrm.com
Drivers continued

   Availability of enablement technology
   Wide Area Network's bandwidth has grown
    drastically
   Lower total cost of ownership
   Focus on core business and not IT




                                  www.pmihrm.com
SaaS – Gartner Definition

   The application is owned, delivered, and
    managed remotely by one or more providers
   The application is based on single set of
    common code and data definitions which are
    consumed in a one-to-many model by all
    contracted customers at any time.
   The application is licensed on pay-per-use or
    subscription basis

                                     www.pmihrm.com
Gartner on SaaS

   With the SaaS approach, the client is
    responsible for the business process, but the
    provider is responsible for the technology
    and its support. As discussed above, the
    application runs at the provider's facility and
    is based on common set of code and data
    definitions consumed by customers in a one-
    to-many model. In addition, SaaS providers
    use a subscription revenue model.
                                       www.pmihrm.com
Gartner on Hosted/ASP

   With this option, the client is still responsible
    for the business process, but the provider is
    responsible for the technology and
    technology support. In this option, the provider
    implements a separate instance of the application for
    each customer. There are several different
    economic arrangements possible ranging from
    subscription pricing to the client licensing the
    application from the software provider and
    contracting with the ASP provider just for hosting
    services.                                 www.pmihrm.com
The History and Philosophy of SaaS

   ASP to SaaS, a summary:
SaaS is an outgrowth of the application service provider (ASP) business
   model from the late 90's. However, SaaS is more web-native and less
   client-server oriented (see below). SaaS is generally associated with
   business software, while technically similar, consumer oriented,
   software is known as web 2.0. Often, the two overlap (for example,
   Google Apps hosted office and collaboration suite is available for both
   individual users and business domains.

    SaaS vendors often market their product as an alternative to standard
    boxed software, without the upfront price and the technical
    infrastructure and expertise required to install, configure, and manage
    traditional software.

                                                         www.pmihrm.com
Time for some examples




                         www.pmihrm.com
Workday model

On-Demand
On-demand is quickly becoming recognized as
 the delivery model of choice for business
 applications. There is no hardware, software,
    middleware, database or business intelligence tool to
    buy, install, maintain, and upgrade. IT resources can
    be redeployed to focus on business innovation and
    value rather than customization and maintenance.


                                          www.pmihrm.com
Benefits

Faster time to implementation
  Gone are the elongated implementation and
  re-implementation cycles of the past.
  Workday will have you up and running in
  weeks, not the standard months or even
  years you may be used to with on-premise
  applications.


                                 www.pmihrm.com
More benefits

Seamless updates and upgrades
 With traditional on-premise applications, companies
 were forced to update and upgrade their software on
 their own dime, often falling drastically behind
 release schedules. With Workday, all system
 updates and upgrades are made on an ongoing
 basis, which means our customers are always on the
 most current version of our service



                                      www.pmihrm.com
More…

Greater economies of scale
 Multi-tenancy (the ability for multiple customers to
 share one physical instance of the Workday solution
 without ever seeing each other's application data) is
 a key feature of Workday. Workday accomplishes
 this through the use of the Workday Object
 Management Server™ (OMS). Workday's multi-
 tenancy model reduces the costs associated with
 supporting our customers, and we pass that cost-
 savings directly on to you.
                                        www.pmihrm.com
Key difference between SaaS and traditional
on-site applications
                                                           Software-as-a-Service
Software-as-an-application


   User pays up-front for a perpetual license, usually       Users’ fees are “pay-as-you-go” based on
    based on the “potential                                    appropriate metrics, such as:
   use” of a server (as measured by MIPS, for                • per seat per month
    example), the numbers of users,                           • per transaction
   plus ongoing maintenance fees.                            • per software module
   A dedicated instance of the software is installed on      • other metrics and/or combination of the above
    a PC or server (or those of                               The software is managed and maintained by the
   the user’s hosting provider).                              SaaS provider (or the
   Users are responsible for deployment, operation,          vendor’s hosting partner).
    and maintenance of the IT                                 For SaaS users the “hoster” is responsible for the IT
   infrastructure required for the application.               infrastructure.
   Users are responsible for upgrading the software as       SaaS vendors upgrade the software automatically
    vendors issue                                              as new features and
   new releases.                                             functionality are developed.
   Users are responsible for ensuring the software will      SaaS vendors (or hosting partners) manage
    continue to operate as                                     changes to the computing
   their computing environment changes.                      environment.
   Users are responsible for configuring software to         SaaS applications are highly configurable and are
    meet specific vertical or                                  designed to integrate with
   other business                                            existing applications and infrastructure.
                                                                                     www.pmihrm.com
    Workday!

www.workday.com

                  www.pmihrm.com
Another Example




                  www.pmihrm.com
1. Traditional License Option

Client has a perpetual license to operate the software,
   based on a group of modules and a fixed employee
   headcount. Expectations: Client provides hardware
   (servers) and self-hosts Client installs software and
   future upgrades Client IT department performs
   backups and recovery services Clients purchase and
   administer SQL licenses Additional annual software
   maintenance contract required for product support
   Benefits: Cost efficient; multiple module discounts;
   Clients have on-site control of hardware and data;
   most flexibility
                                         www.pmihrm.com
2. Subscription (ASP) Option

   Client “rents” hardware/software for a per
    employee, per month fee, based on a group
    of modules and “active” employees.
   Expectations: NuView provides hardware (servers) and
    application through our datacenter NuView installs software
    and future upgrades NuView performs daily backups and
    provides recovery services NuView purchases and administers
    required SQL licenses Software maintenance and support
    included in monthly fee


                                               www.pmihrm.com
3. Blended (Hybrid) Option

Client has a perpetual license to operate the software, based on a group
    of modules and a fixed employee headcount, but the system is hosted
    in the NuView datacenter for an additional monthly fee.
    Expectations: Client licenses a group of modules, at a fixed employee
    headcount NuView provides hardware (servers) and application
    through our datacenter NuView installs software and future upgrades
    NuView performs daily backups and provides recovery services
    NuView purchases and administers required SQL licenses Additional
    annual software maintenance contract required for product support
    Additional per employee, per month fee for hosting
    Benefits: Most flexible option that provides the best of both worlds –
    cost efficiencies of a perpetual license, but no investment in hardware
    or IT resources is needed. Our datacenter provides security, reliability
    and disaster recovery peace of mind.
                                                        www.pmihrm.com
HRWARE in Canada

   NuView partner
   HRWARE SaaS™ provides your business with 24 X 7 global
    access to your HRW@RE application and data via Verizon’s
    award winning global network. The Verizon Business data
    network includes more than 446,000 route miles, spanning six
    continents and operates in more than 2,700 cities and 150
    countries.
   Via 16 high-speed IP POP’s, 2 Premium Data Centers, 4
    Hosting Co-location Centers and 4 GDL/PIP Nodes all
    connected with redundant backbone OC-48 and OC-12 circuits,
    HRWARE offers you award winning, world class, highly secure
    hosting services
                                                www.pmihrm.com
ADP

      ADP (Automated Data Processing, Inc.)
      announced that is acquiring Employease, a
      10-year-old company that provides SaaS
      HR, payroll and benefits services for 1,500
      clients, with more than one million client
      records under management.
      the blurring of business services with application
      services. ADP is not a software vendor, even
      though it uses a lot of software and computer
      power to run its service offerings. No one ought
      to start calling ADP a software-as-a-service
      vendor as a result of this acquisition. It hasn’t
      become a software vendor, it’s merely extending
      into new areas of automated business services
                                                     www.pmihrm.com
Oracle




         www.pmihrm.com
Oracle – Larry Ellison

   SaaS is all the rage these days. Cloud
    computing and SaaS are new paradigms and
    are one of the fastest growing segments on
    the web operations side. However, Larry
    Ellison, the founder and CEO of Oracle has
    said that his company hasn’t participated in
    the software-as-a-service trend because
    there’s no money to be made there.

                                    www.pmihrm.com
Larry really means…

What Ellison is saying, essentially, is that SaaS stinks because
  customers would pay so much less to Oracle. There’s less
  consulting fees, integration fees, and no big up-front license
  fees. Ellison called subscription-based software “very
  interesting, but so far no one has figured out how to make any
  money at it.” Oracle’s plan is to keep selling to big companies,
  pitching them on vertical applications once they’ve filled up on
  databases, middleware, and general ERP. It offers Siebel CRM
  On Demand, and has said it’s willing to host software for
  customers, but Oracle, by far, is primarily an on-premise
  software company, according to Information Week.


                                                 www.pmihrm.com
SAP hires SaaS Guru from RightNow

SAP SaaS ERP release for the midmarket

 SAP's rocky road to on-demand




                                         www.pmihrm.com
Ultimate Software

      Intersourcing is the pay-as-you-go hosted
      HR/payroll service that enables you to
      enjoy all of the flexibility and control over
      your own business processes while
      someone else worries about managing and
      supporting the HR/payroll system. You
      don’t incur the expense of running an ever-
      expanding IT department or have the
      headaches associated with playing the role
      of a systems integrator. You can spend
      time doing what you do best—moving your
      business forward.


                                                www.pmihrm.com
SuccessFactors




     http://www.successfactors.com/



     New Research Shows Superior Revenue
     Growth Achieved Through SaaS-Based
     Human Capital Management Usage



                                      www.pmihrm.com
Benefits of new tools such as SaaS

   Software as a Service (SaaS) for Payroll and HR
    Management
   Allows users Internet access to management tools
    online -- without warehousing and manual retrieval
   Guaranteed 98 percent up-time
   Remote disaster recovery centers
   Compliance with all federal/state laws and
    regulations
   hosting to eliminate expensive servers, licensing and
    technical allocations
                                           www.pmihrm.com
Benefits

   Benefit to the Client
For the client, there are low upfront costs. Executive
  teams, and Company Boards, desire to outsource
  critical functions that are not deemed part of the
  organizations’ “core business” address the corporate
  need to focus on core business. In particular for the
  HR space the perception of HR as a “cost center”,
  rather than a strategic partner in the organization –
  and makes a contrary vote all the more difficult.

                                         www.pmihrm.com
Benefits..
   Pricing is based on subscription / value based Hence the customer need not pay any
    upfront license cost and rather align his cost with his annual budgets.
   Less impact in IT: As there are no deployment and implementation needs, there is less
    impact in the IT infrastructure and support. .
   Quick and Reliable implementation
   No lock-in - Customers have the option of breaking the relationship and moving to a
    different vendor. Since there is no upfront cost and the cost is primarily subscription based,
    if they find a better service or low cost they can always move
   No need to pay for bugs in the application – traditionally the customers after paying for the
    software, also pays for the bugs in the software in terms of maintenance and support fees.
    In the new model the cost of hosting, maintenance and licensing are not separated,
    customer only pays a fixed subscription fees.
   This new model has created a level playing field, in which the software tools which were
    traditionally available only to big players (reason being huge License cost, lack of IT
    support and infrastructure) is now available for SMB’s too



                                                                         www.pmihrm.com
                                              Outsourcing Will Increase


                                          HR Outsourcing Components: Processes,
                                          Technology, and People – Worldwide

              Processes – Today

 Processes – 12 months from now



            Technology – Today

Technology – 12 months from now



                 People – Today

    People – 12 months from now

                              0%                      20%                   40%                    60%                   80%      100%

                                       0 Not outsourced, will never be outsourced
                                       1 Not outsourced today or for next 12 months, but may be someday
                                       2 Partially outsourced
                                       3 Fully outsourced

                                  Source: CedarCrestone 2007 Workforce Technologies/Service Delivery Approaches Survey



                                                                                                                 www.pmihrm.com
                                         Process Outsourcing Varies Widely




401k, superannuation, other retirement plans
                                   Pension
                                   Benefits
                                    Payroll
                                   Training
                                 Recruiting
                       Time and attendance
         Employee and manager self service
                             Compensation
                         HR record keeping
Performance mgmt. (goal setting, appraisals)
                       Succession planning
                        Workforce planning

                                              0%                     20%                     40%                     60%              80%   100%
                                                   0 Not outsourced, will never be outsourced
                                                   1 Not outsourced today or for next 12 months, but may be someday
                                                   2 Partially outsourced
                                                   3 Fully outsourced
                                                                                                                      www.pmihrm.com
                                               Source: CedarCrestone 2007 Workforce Technologies/Service Delivery Approaches Survey
Trends in SaaS – October 2008

   The use of software as a service (SaaS) among small-to-medium
    businesses is on the rise, according to a report by Access Market
    International Partners (AMI-Partners). The market intelligence firm
    surveyed various businesses, defining small businesses as having one
    to 99 employees and medium ones at 100 to 999 employees.
   The study, covering the year 2007, found that 21 percent of small
    businesses (SBs) and 31 percent of medium businesses (MBs) use
    SaaS, which are double the rates found in 2004. Adoption of SaaS
    was spurred by cost factors and ease of use, according to the report.
    Moreover, businesses are requiring software solutions that are easy to
    implement and maintain. The lack of infrastructure costs enabled by a
    SaaS solution can be a benefit too.
   MBs were the largest adopters of SaaS, spending six times as much
    as SBs http://adtmag.com/article.aspx?id=22208
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Questions?




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    Some HRMS Web Sites
   HRMSP                  www.hrmsp.org
   IHRIM                  www.ihrim.org
   Phenix                 www.pmihrm.com
   HRMS Book              www.hrmsbook.com
   www.hrtechconference.com
   KnowledgeInfusion
       www.knowledgeinfusion.com/




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Further questions:
Al Doran 416-505-6204
Aldoran@pmihrm.com
www.hrmsbook.com
www.pmihrm.com




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