.png)
Shared services: the benefits of working together
4 August 2008:
Peter Reilly is director of HR research and consultancy the Institute for Employment Studies
He joined the institute in 1995 as a senior research fellow after a 16-year career with Shell, where his work included an investigation of the changing nature of the employer/employee relationship and its impact on Shell in the UK, set in the context of likely internal business developments and external social and economic changes.
Before he joined Shell he was a senior research Officer at the British Institute of Management where he wrote reports on profit sharing, employee participation practices and trends in British industry. At the Institute for Employment Studieshe leads the work on reward, also contributing significantly to HR planning and labour market projects.
Spot the benefit
As originally conceived, shared services is about bringing together dispersed activities into a single organisational structure for the benefit of 'customers', or staff. In this model, according to HR business partner guru Dave Ulrich, 'the user is chooser'.
Cost reduction is an important driver, but not the only one. Savings principally come from cutting jobs, but accommodation charges can also be reduced and corporate buying power increased. A second driver is the ability to provide higher service quality through simplified, standardised processes based on best practice norms.
A variety of activities can be undertaken in a shared services centre, especially administrative tasks (such as payroll and employee record changes), but also the provision of information via an intranet and advice via a contact centre. Some organisations may also include case-work or consultancy support. Sometimes, but not always, shared services are introduced as part of a wider HR reconfiguration, creating centres of expertise and business partners.
According to a 2007 survey, conducted by the Institute for Employment Studies for CIPD, the top five benefits of shared services are:
- repositioning HR
- improving credibility of function
- HR becoming more strategic[?]
- improvement in service quality
- more responsive customer service.
Two things are striking about this list. Cost reduction, though an important driver for change, is not always achieved, perhaps because process standardisation and reform or systems improvement have not happened as they should have done.
Second, shared services are seen by HR as part of a transformation in its role towards becoming a strategic, rather than administrative/operational, contributor. This is because shared services (together with automated and self-service processes) should reduce the time spent on administration, leaving the HR function to focus on higher value-added activities.
Read more...
Source: Personnel Today
