Everything you need to know about HR shared services

Consolidation is a buzzword when it comes to increasing efficiency. Whether it’s data, debt, or freight, consolidating several disparate elements makes understanding and processing them significantly more manageable. And, thankfully, this can be applied to the world of Human Resources too.

Implementation of HR shared services is an effective way to consolidate technology, strategies, and resources into one cohesive, consistent shared service model.

From regular operational duties to the leveraging of HR tech, HR shared services acts as a centralized hub that takes on daily responsibilities, allowing companies to get precious time back, and focus on strategic initiatives.

That said, rolling out an HR shared services model isn’t without its risks. Organizations will face challenges if they do not prepare adequately and conduct thorough investigations into which model will work best for them. But for those businesses hungry for a more strategic outlook, in search of operational excellence, and looking to improve employee experience, HR shared services is worth the time and investment.

What are HR shared services?

Put simply, HR shared services is a multi-tiered solution that creates far reaching coverage of multiple HR responsibilities. With growth and expansion on every businesses’ respective minds, internal resources can quickly become stretched thin. And that can leave an HR department overwhelmed with sourcing new staff, onboarding, processing queries and paperwork, and overseeing talent development.

But thanks to evolving technology, organizations now have the ability to encapsulate the entire HR experience for multiple departments, or even in some cases, different subsidiaries. This is achieved by grouping together administrative activities, such as recruitment, payroll, training, and absence monitoring. Queries and tasks associated with these duties are then sorted and process by a tiered HR shared services structure.

Tier 0

Using a centralized HR portal, employees are able to field and resolve self-service queries by themselves. This can include checking paystubs, logging annual leave requests, or completing mandatory training exercises.

Tier 1

Queries that cannot be handled by the employee alone, are processed by an internal customer service center. And is usually completed over phone or email.

Tier 2

This tier focuses on queries and tasks that have a level of complexity which goes beyond a straightforward solution. As such, an HR specialist will be required to investigate further and report back their findings.

Tier 3

Not every employer will have or need a third tier, as this final stage of escalation is designed for queries that call into question HR policy or strategic decision-making. And require higher ranking consultancy and intervention.

Now, regardless of how broad and expansive your company may become, you have the necessary tools and structure in place to counteract the ever-growing employee base, and all the accompanying queries that generates. Which then affords the wider HR department the time and resources to turn their attention to initiatives that will improve company culture, maximize efficiency, and elevate employee experience.

Benefits of HR shared services

Having an HR shared services structure in place can lead to a wealth of possibility for companies. Not only in terms of reactionary damage control and impact limitation, but most notably when looking at the changing industrial landscape and where to take the business in future.

A well-researched HR shared services model creates consistency and compliance throughout the company. This is because all HR matters are processed in a consistent manner, that mitigates risk and aligns with regulations, ensuring staff at every level are protected. And with employees becoming quickly familiar with this level of efficiency, businesses see a sharp increase in employee engagement and satisfaction.

Also, through the assignment of designated responsibilities, the HR process is streamlined and optimized, to guarantee an impressive degree of excellence. Which is primarily down to the fact that when your teams aren’t being weighed down by myriad routine issues, their skills can be put to better use on larger, more impactful projects.

Cost reduction is another HR shared services benefit that can’t be overlooked. Every business is constantly trying to optimize efficiency and save costs without cutting corners. And HR shared services achieves this through a simplification of connecting employees with the information they’re after in a prompt fashion. It also sees the consolidation of transactional services through HR tech, and less reliance on employing expensive HR professional consultancy for simple matters.

But one of the key benefits is the time freed up to be redistributed elsewhere. When your experienced HR professionals and specialists are no longer inundated with smaller daily duties, they can spend more time hunting down exciting opportunities. As well as analyzing HR metric data, contributing to business strategy, and providing the necessary insight to create robust people management that skyrockets employee experience.

Potential issues arising from HR shared services

HR shared services challenges can present risk to a company and require due attention and care. With that in mind, here are a few key factors to consider when considering HR shared services examples and options.

Ensure you undertake the necessary planning and budgeting to successfully increase your HR automation. Without a clear digital roadmap, your organization could end up with costly incompatible technologies, overly complicated systems, and resources pulling in opposite directions.

Board level approval and buy-in is essential. Without the support and drive from the top down, any significant effort to reap the benefits of HR shared services will falter at the first hurdle.

It’s important to remember that while HR is adaptable to fit any type of organization that hires and uses the services of people, the vast programs and solutions out there are by no means one size fits all. Your team will need to extensively study not only the options available to them, but the gaps within your company that need addressing. Making finding an HR shared services model that suits your requirements a less daunting task.

And finally, as with all new endeavors, there will be resistance to accepting new processes and ways of operating. Rather than battling these voices, it’s crucial to hear this feedback and respond to it in an open way, that is both reassuring and acts to motivate and inspire employees with what’s to come.

The best practices to implement HR shared services

Transform

Any organization looking to achieve positive growth must undergo a transformation. And, in this instance, the first step is ascertaining the specific activities and duties that will fall under your new HR shared services.

Conducting an internal audit to understand where resources are being spent, is a critical first step in deciding how they can be repositioned and better utilized.

Knowing this, you will then be able to designate roles and responsibilities internally, or conclude if you require an external company to centralize oversight across multiple sites and locations. Furthermore, understanding what is needed and where it must be rolled out, can help inform the decision-making process when it comes to choosing the right technology to support your workforce.

Maximize capabilities

Now that your HR shared services implementation has been a success, it’s important to maximize its potential. This can start by investigating and offering new, expanded services. Which can take the form of an increase in reporting and analytics to improve your HR output. Allowing upper management to study and digest predictive analytics that assess where the company is heading, prescriptive analytics which offer actions from emerging trends, and diagnostic analytics that identify the source of problems arising within the organization.

Additionally, with so many duties being successfully conducted in a standardized manner, it’s possible to explore the option of further automation and enhanced digitalization of the HR process.

Enhance

With the power of a transformed workplace and a steady stream of analytical HR data, where can businesses take HR shared services next? At this point, your HR team are able to collect reliable feedback to provide continuous improvement. By enhancing workflows, and considering the changing needs of the company, policies can be drafted and rolled out that signal your organization as true thought leaders.

On top of this, further process automation can be explored confidently, clear digital roadmaps for future goals can be drawn up with greater ease, and employee development can sit in the spotlight. All because the necessary steps have already been taken and your HR shared services solutions have been tried and tested to produce the results you need.

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