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The Art & Science of HR Service Delivery
Carrie Alexander, Senior Consultant
Tara Morey, Senior Consultant
Findley DaviesSeptember 17, 2015
Speakers
Areas of Expertise (12+ years)
HCM Technology Evaluation
HR Strategy
HR Service Delivery
Project Management
Strategic Employer Wellness
Areas of Expertise (15+ years)
HCM Technology Evaluation
HR Strategy
HR Service Delivery
Project Management
Process Improvement
Carrie Alexander, PHR and MOL Tara Morey, HRIP and PMP
Today’s HR Service Delivery Topics
Why is an organization’s HR service delivery model important?
HR represents a significant expense for all companies
Value in correctly aligning people, resources, and technology
We all want to deliver HR services better and more efficiently
What is HR Service Delivery?
How HR organizes and structures people, processes and technology to deliver value and align with the business
How do you determine the right approach for your organization?
Art and science in determining and implementing the right approach
The Cost of Human Resources
“In most organizations, including large organizations such as the Fortune 500™, total human capital costs, also known as total cost of workforce,
average nearly 70% of operating expenses. While an organization’s total cost of workforce percentage may vary, with few exceptions these
costs remain the single biggest organizational expense”.
Source: Human Capital Management Institute
“Companies spend between $748 and $1,500 per employee per year on HR administration (separate from
training and payroll expenses).”
Source: Bersin & Associates, 2011
There’s a need for HR leaders to shift focus….(number of staff, percent of time and costs (e.g., technology fees, outsourcing fees, and general administrative fees )
HR Strategy; 23%
HR Talent Man-agement; 31%
HR Transactions and Administration; 46%
CURRENT
HR Strategy; 36%
HR Talent Management; 36%
HR Transactions and Administration; 28%
DESIRED
HR Resource Allocation (costs, time)
Source: FD 2015 HR Service Delivery Survey
Other Similar Findings
Source: Accenture,, 2011Source: Bersin & Associates, 2011
Source: Capgemini, 2007
What is HR Service Delivery?
How HR organizes and structures people, processes and technology to deliver value and align with the business
An effective service delivery model is one that delivers the maximum value for minimum cost
The appropriate HR Service Delivery model is determined by examining: If work is unique to different locations or business lines
What services need to be consistent throughout the organization or locally tailored
Whether HR can be centralized at corporate or decentralized locally
Why organizations make service delivery changes
Improve efficiency Align/adapt HR priorities Streamline operations Synergize processes and
investments Improve quality Support globalization
React to changing business strategy
Respond to reorganization Enhance strategic role of HR Achieve flawless HR
administration Connect the organization Measure HR performance
Initiatives to improve HR Service Delivery
Re-engineer key HR processes Implement new technology (HRMS, portal, employee and
manager self-service) Create or refocus role of HR Business Partner (HRBP) Build HR analytics Outsource (e.g., payroll, benefits, pension, relocation) Implement a shared services model with Centers of Expertise
(COEs), HRBPs and administrative call or service center Build HR project management function
HR Service Delivery Models – Terminology
Model Definition
Shared Services
environment with
HR COEs and HR
BusinessPartners
• HR Business Partners draw support from skilled resources in Centers of Expertise (COEs) and service centers
• Commonly referred to as the Ulrich model: was introduced by David Ulrich in 1997 (University of Michigan)
• Many organizations implement variations of this model• Initially suited for large (over 20,000 employees) and mid-
size (over 5,000 employees) employers due to the need for strong technology, high quality documents, and training
Centralized or Single HR Function
• One HR function managed centrally for the entire organization; designs programs and processes, accountable for execution
• Most commonly reported HR structure (2012 Towers Watson survey)
HR Service Delivery Models – Terminology
Model Definition
Decentralized/ separate HR function by business unit Corporate oversight
• Separate HR functions run by a specific business unit• Separate HR functions are responsible for execution• Some corporate oversight to support the business units
with program design and processes
Decentralized/ separate HR function by geography Corporate oversight
• Separate HR functions run by region• Separate HR functions are responsible for execution• Some corporate oversight to support the business units
with program design and processes
HR Service Delivery Model – Comparison
Advantages Disadvantages
Shared Services
environment with
HR COEs and HR
BusinessPartners
• Allocates resources according to functional need, business cycle• Enhances quality control• Quickly create and adapt new
processes• Provide specialized/dedicated
expertise to business units • Consolidates work, standardizes
processes for economies of scale
Requires• Well defined processes• Well deployed
technology – self-service, portals for searchable answers to questions, case management tools
Centralized or Single HR Function
• Consistent process delivery across organization• Traditional model: familiar and
adopted fairly easily
• May not be as aligned with needs of business units• Multiple points of contact
for HR
HR Service Delivery Model – Comparison
Advantages Disadvantages
Decentralized/ separate HR function by business unit Corporate oversight
• Complete alignment with the business unit to deliver specialized HR
• Increased HR headcount• Redundant services,
roles• Costs can be higher
Decentralized/ separate HR function by geography Corporate oversight
• Complete alignment with the regions to deliver highly specialized HR services
• Increased HR headcount• Redundant services,
roles• Costs can be higher
Case Studies
How do you determine the model for your organization?
Case StudiesHR Service
Delivery Model
Head-count
Business Need
HR Leadershi
p
Technology Client’s Need
A Decentralized with some centralized oversight
8,000 More consistent HR practices for complianceReduce risk
New Very limited technology in place (aside from Payroll)
No interest in surveys and assessmentsJust tell us how we should be delivering HR!
B Decentralized with some centralized oversight
2,500 More talent management and streamlined administration
Newer (within 3 years)
Very limited technology in place(aside from Payroll)
Existing HR roadmap and strategy – not sure it’s the right path; not achieved it yet
C Centralized and paternalistic
6,000 Be better HR business partners; less administrative
New Some HR technology for payroll and recruitment; not fully deployed
HR roadmap to guide transformation
Our Approach – Client A
Interview organizational leaders
Conduct focus group with operational leaders
Facilitate action planning meeting with HR leaders
Review industry benchmarks and best practices where possible
Develop roadmap
About Client A
Decentralized HR
7,000 employees
Desire for more consistent HR practices for compliance and reduce risk.
Very limited technology in place (aside from Payroll)
New HR leadership
No interest in surveys and assessments
Just tell us how we should be delivering HR!
Interviews & Focus GroupObjective: to provide the business leaders with an opportunity to provide input on how HR Services can best support the current and future business needs/strategy.
Comment on the top 3 HR services that you utilize
How do you think the organization is doing in regard to attracting, retaining and developing talent and top performers?
How can we best equip the organization (you) to attract, retain and develop top performers?
What services should we be providing that we are not doing today?
HR Action Planning Session How can we best leverage
technology to drive value for our organization?
Ways to ensure the HR team is properly aligned with the goals and direction of the business plan?
How will we monitor/measure our alignment and progress?
What will have the highest business impact and HR importance?
What will we do next, what are the obstacles to address, who needs to be involved and when?
HR Realignment: Current State
HR Realignment: Future State
Roadmap
Outcomes – Client A
Created and filled new roles in HR Selected and implemented HCM technology to streamline
administration – core HR, benefits, self-service Continue to improve processes and implement technology (e.g.,
time and attendance, talent management)
Our Approach – Client B
Vet the existing HR Service Delivery Model in a Planning Session with HR Leadership
Conduct an HR Activity Analysis (with salary allocation) with all HR team members
Review industry benchmarks and best practices where possible
Vet the results of the HR Activity Analysis with HR Leadership and determine roadmap
About Client B
Decentralized HR
2,500 employees
Desire for more talent management and streamlined administration
Very limited technology in place
New HR leadership
Had an HR roadmap and strategy – just not sure it’s the right path; had not achieved it yet
Vetting the Existing Model
Where are we now?
Where should our target be to achieve business goals?
Client’s
Activity Analysis Survey
Activity Analysis Survey
HR Staff Allocation Comparison
Action Planning & RoadmapPurpose: To vet and prioritize the results and key findings/observations from the Activity Analysis survey
Are there other key findings and actions to consider that were not significant outliers that should be considered priorities?
What are your reactions?
What needs to be considered in order to move forward?
What are the consequences if we don’t make these changes?
What is the highest priority?
Outcomes – Client B
Revised the HR roadmap collaboratively with the new HR leadership team so there is now a shared vision that the team can support
Developed a clear list of prioritized next steps to move to an Ulrich-like service delivery model that is appropriate for their organization’s size and decentralized business model
Developed business case for new and integrated HCM technology
Our Approach – Client C
About Client C
Centralized HR – paternalistic
6,000 employees
Desire to be better HR business partners and less administrative
Some HR technology but not fully leveraged
New HR leadership
Needed an HR roadmap to guide their transformation
Project planning meeting with HR Leadership Team
Time Allocation Survey with all HR team members
HR Practice Questionnaire with HR Team Leads
Interview Organizational Leadership Survey all managers on HR Service Delivery HR Skills Inventory with all professional level
HR team members Review industry benchmarks and best
practices where possible Present and vet the results of all
assessments with HR Leadership and determine roadmap
HR Planning Session Things we have done well So-so activities What we have failed to do Key competencies for the
ideal HR associate What should we stop doing? What should we start
doing?
Assessment Tools: Time Allocation
Each HR staff member completes
on-line survey indicating how much time they spend delivering
services in the 12-16 Core HR processes
Assessment Tools: HR Practice Questionnaire
Collect and measure data on the current costs
and practices related to the 12-
16 core HR processes utilized
to deliver HR service
Assessment Tools: Manager Survey
Focus on key competencies relevant for HR professionals
Assessment Tools: Interviews
One-on-one interviews with a select group of executives to
supplement the feedback from the manager survey
Assessment Tools: HR Skills Inventory
Focus on key competencies relevant for HR professionals
Action Planning & RoadmapReviewed positions to reflect a new organization structure. Discussed:
What leadership positions need to exist (Director and Manager roles)? Consider prioritizing recruitment and training.
Where should HRIS report? What level?
What locations should have dedicated HR Business Partners?
How would a Shared Services model work?
How would a PMO work?
Consider integration of global activities into organizational structure
Outcomes – Client C
Measurement – The HR team developed a baseline measurement of performance. The manager survey was re-administered one year later to find improved results.
Roadmap – given our recommendations, the HR team then collaboratively developed an action plan and are implementing the changes. Shared services are on the horizon.
Continuing to improve processes and better leveraging existing technology.
Key Take-Aways There’s no silver bullet or off the shelf solution. What works for one
organizational structure, culture and budget might not work for your organization. Take the time to assess what your organization’s business needs are and configure the model appropriately.
Change takes time. It’s a journey. Expect a 3-5 year roadmap.
Be prepared to build the business case. You must have a solid handle on what you're asking to deploy from a cost/benefit perspective.
Determine up front how you will measure your progress. This means you will need a baseline. Capture the data before you start your journey.
Gather support, resources, and get started! There’s never a perfect time.
Resources
HR Service Delivery Checklist Top 10 Project Management Words of Advice HR Service Delivery Survey Report HR Rapid Reads
http://www.findleydavies.com/
References
Developing a Value Driven HR Delivery Model. Applying the Ulrich Model of HR. Capgemini NCOAUG Presentation (2007). Available at http://www.slideserve.com/abril/developing-a-value-driven-hr-delivery-model
Industrial-Organizational (I-O) Psychology's Contribution to Strategic Human Resources Outsourcing (HRO): How Can We Shape the Future of HR?, Accenture/Kevin Kramer, January 2011. Available at http://www.siop.org/tip/jan11/03kramer.aspx
Managing an Organization’s Biggest Cost: The Workforce. Human Capital Management Institute. Available at: http://www.hcminst.com/files/OrgPlus_Total_Cost_Workforce_.pdf
The HR Factbook: Executive Summary (2011). Bersin & Associates. Available at: http://marketing.bersin.com/rs/bersin/images/060111_ES_HRFactbook_KOL_Final.pdf
