Organisations use shared services as a way of organising their HR activities, typically concentrating administrative activities into a centralised and commonly shared function. The shared service model often helps businesses reduce costs as well as many other factors such as avoid duplication of effort and allow a greater focus on HR strategy.
What are HR shared services?
The most important dimension of HR shared services is that the activities which are involved are available to a number of parties, all of which are common services. This then further defines the customer level of service and decides which services to take up.
A range of activities can be covered in HR shared services. These include activities such as administrative tasks. These tasks include payroll changes, benefits administration, pension administration and much more.
Benefits of HR shared services
There are many benefits with HR shared services. These include:
- Lower and transparent costs
- Improved management information
- Better and more selective and strategic contribution from HR
- Better quality services
- Improved cross-group learning
Issues surrounding HR shared services
There are many issues which can arise with HR shared services. These include:
- There are different types of customers to be convinced
- Anticipating communication difficulties
- Guarding against a lack of effective accountability
- Devolving work to line managers successfully
- Deciding to whom resources should be allocated