Myth busting HR Shared Services

How accurate are your perceptions of HRSS?

Myth busting HR Shared Services Posted by Greg Vert on March 16, 2016

If you still think of HR Shared Services (HRSS) organizations as little more than call centers and data entry hubs, it may be time to reset your perceptions—and your expectations. HRSS is continuously evolving to meet a new set of demands from the businesses it supports. To meet these demands, the modern HRSS operates more like a commercial business—focused on cost control, value creation, and customer service all at once.

For many years, companies have used HRSS organizations to handle highly transactional services like HR data administration and basic employee inquiry resolution. These administrative activities are still part of the scope for many HRSS organizations, but they are increasingly supplemented by a range of interactive and knowledge-based services. HRSS organizations are also becoming more operationally focused, emphasizing service and process excellence with a continuous improvement mindset, rather than simply driving transactional volume and other “throughput” metrics.

Not convinced? Don’t believe the hype? Let’s debunk a few of the common myths about HRSS.

Myth 1: HRSS is all about cost savings and reducing HR headcount

HRSS implementations have traditionally started out with a detailed business case to estimate the return on investment generated by transitioning to a new model. The output of the analysis was often translated into financial targets and benchmarked ratios of HR staff to employees. While cost-effectiveness is still a goal, more companies today are focused on the value HRSS can deliver and the potential for intangible benefits aligned with overall business strategies to extend beyond the hard-dollar savings. Here are a few examples:

  • Global organizations are faced with a number of talent management challenges. The HRSS model brings with it harmonized policies and consistent service delivery practices to facilitate cross-border reporting relationships and the more seamless deployment of talent around the world. It is also generally easier for HRSS organizations to scale or extend to new markets to support growth strategies.
  • The governance and controls associated with the HRSS model have allowed organizations to improve compliance levels both globally and locally. The standardization of processes and practices can increase adherence with enterprise policies and global regulations while variations in HR service center operations can create enough flexibility to accommodate local laws and critical business practices. In other words, HRSS can help an organization strike the right balance between standardization and flexibility.
  • Many industries are experiencing unprecedented levels of M&A activity. The standardization and centralization of data and processes associated with the HRSS model can make it easier for organizations to both integrate and carve out business units, which potentially enables increased speed of value capture for the transaction and reduced disruption for the future-state organization.
  • With increasing pressures to simplify work, organizations are using the HRSS model as a foundation to deploy a more productive and collaborative employee experience. There are new tools and technologies available on the market to help HRSS simplify process and transactional work and to make it easier for employees to connect with support resources, similar to the online experience customers would expect from a commercial business.

Myth 2: HRSS organizations employ a low-skill workforce

HRSS is increasing scope to add more advanced and complex activities. According to Deloitte’s 2015 Global Shared Services Survey, 81 percent of organizations surveyed are planning to expand by adding knowledge-based services. Supporting and leading these enhanced services requires a different set of capabilities, such as a high degree of business acumen and operational understanding not often associated with traditional HRSS roles. These new talent requirements could make HRSS an important development ground or career destination for HR professionals. Here are a couple of the new capabilities for a modern HRSS organization:

  • Drive for operational excellence. Transaction processing skills are no longer the endgame. HRSS talent needs to understand how to drive process optimization and use new technologies to increase automation and create an intuitive experience for end users.
  • Focus on continuous improvement. Modern HRSS organizations require analysts with the ability to evaluate business problems, develop solution options, and recommend and fully implement leading practices to drive more value for the business.
  • Establish and manage effective partnerships. HRSS professionals need to have the ability to create productive and synergistic partnerships with other functions, HR teams, and outsourced providers. Understanding the end-to-end service delivery model can help HRSS identify opportunities to improve the handoffs and interactions between the different components to create an efficient operation and improve the overall experience for customers.

Myth 3: HRSS organizations sacrifice personalized customer experience

Many organizations are concerned about losing the personal touch associated with receiving services from on-site HR representation. However, moving to the HRSS model can provide more opportunities to deliver a consistent set of services through multiple channels (phone, online, chat) to allow the customer to decide how to interact with HR. Online channels can provide 24/7 access to services and are often expected by employees accustomed to web-based interactions outside the workplace.

The HRSS model also promotes consistency by centralizing the knowledge and content needed to address different types of employee needs and managing operations against pre-defined SLAs. As a result of the governance and discipline of HRSS, many organizations experience improved response time, quality, and overall customer satisfaction.

Myth 4: HRSS is dependent on implementing an enterprise core HR technology

HR transformation has historically started by first building a technology infrastructure (traditionally ERP-based) and then developing the service delivery model to support it. The cloud-based options and systems of engagement available in the market today make it possible to jump-start the journey toward HRSS without having a single, unified HCM platform as the foundation. These front-end tools are designed to provide an intuitive and consistent user experience by sitting on top of multiple back-end systems, which are a common reality of the modern business landscape, especially for large enterprises. While standardization and harmonization of HR processes are still required, these top-layer tools make it possible to have a consistent service delivery model supported by HRSS without having a single system behind the scenes.

The HRSS evolution continues to break down traditional perceptions of the model. As a result, many organizations are now unlocking new opportunities for HRSS to add more value and improve customer service levels. Don’t let old misconceptions prevent your organization from capitalizing on the latest trends and innovations.

Greg Vert is a manager in the HR Transformation practice of Deloitte Consulting LLP. He works with his clients to improve overall HR service delivery through the design and implementation of leading practice HR processes, shared services, and enabling technologies.

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