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1、,Shared Services for HR,Peter Horan,Mercer Human Resource Consulting 2006,HR Shared Services Why the interest?,Shared services in the US has been shown to save 28% of HR labour costs. As well as better quality, consistency and employee satisfaction. Does it work outside the US? In a large country or
2、 region? In Latin America, in Europe, in Asia, in China?,Mercer Human Resource Consulting 2006,The Success of Shared Services It works . but,Q1. Has it been a success? Yes. A huge success . . . when well planned and executed. Q2. Does it work for all organizations? Yes, but the impact, challenge and
3、 ROI varies between organizations Q3. Does it work in every country or region? Yes, but the impact, challenge and ROI varies between geographies Q4. Does it actually result in better support to the local businesses? Yes, provided that HR skills and competencies are appropriate.,One size does not fit
4、 everyone!,Mercer Human Resource Consulting 2006,HR Shared Services Criteria for a good business case,The financial benefits depend on: Labour Costs Just like outsourcing. Locate the SSC in lower cost location. Locations More sites or divisions. More duplication or variation. More opportunity to imp
5、rove. Population Large workforce means economies of scale from consolidation. Consistency More variety in programs and policies, and particularly regulatory or cultural, the tougher it is to consolidate.,Mercer Human Resource Consulting 2006,Criteria for Business Case How it varies by region by regi
6、on,Drivers are the same - impact varies dramatically between regions,USA,Europe,Latin America,Asia,China,Labour Cost,H,L,H,L,?,Locations,M,H,M,H,?,Population,H,H,M,H,?,Consistency,H,M,M,L,?,Mercer Human Resource Consulting 2006,Typical HR Shared Services Model In the final state,Geography/Business U
7、nit HR BU specific Administrative,Geog/Bus Unit HR,HR Centre of Expertise,HR Service Centre,Outsource Providers,Local HR Service,HR Shared Services,Business Units,Self-Service,Managers & Employees,Technology Platform,Mercer Human Resource Consulting 2006,Emerging Model for International HR “As commo
8、n as possible as unique as necessary” *,HR Partners,HR COE,Administrative & Transactions,Local HR Teams,HR Governance,Common = Shared,Unique = Local,Large Workforce,Small Workforce,Virtual Shared Services,Physical Regional Shared Service,Local,Physical Regional Shared Services,Locally Outsourced,Reg
9、ionally Outsourced,Local & Regional,Local & Regional,Local,Local,* motto of Cisco Systems,Sub-Regional Shared Service,Mercer Human Resource Consulting 2006,Phasing the Change Rationalisation is the first step,Dont just standardise maximise consistency in programs and processes Consistency will enabl
10、e better quality and exploitation of economies of scale,The journey might be a series of smaller steps,Mercer Human Resource Consulting 2006,Criteria for Success Not same as business case,Rationalisation To achieve economies of scale Technology To get beyond immediate borders,Governance Most common
11、cause of failure Ownership Most common cause of ROI erosion,Showstoppers,Enablers,Shared Services is not optimisation its real change!,Mercer Human Resource Consulting 2006,Getting Ready for Shared Services What you want to do,High level of integration, consistency and organisational commitment,Desi
12、re,Ability,Best Practice,Just Starting,Consolidating,Shared Services,Not ready,Very ready,Low ROI,High ROI,Mercer Human Resource Consulting 2006,Unintegrated platforms Inconsistent data and processes Leadership unwilling to mandate consistency HR not professionally trained,Platforms Data Leadership
13、Competence,Getting Ready for Shared Services What you can do,Just Starting,Some integrated platforms Working toward quality data Willingness toward consistent data and processes Leadership commitment Increasing professional competencies,Consolidating,Integrated platforms High quality data Consistent
14、 and integrated data and processes Total organisational commitment Professionally trained HR Focus on measurement,Shared Services,Mercer Human Resource Consulting 2006,Internatl Telecoms Great result. CEO/VPHR commitment. Global US Chemical Abandoned. Could not agree governance. Global US Food Compl
15、ete autonomy. Start with rationalisation. Global Hi-Tech Focus on policy and process harmonisation. Global Japanese Hi-Tech Internal teams. US used as the pilot. Global German Manufacturer Abandoned. Challenge too big. Return too slow.,Some Examples With variety of outcomes,Mercer Human Resource Con
16、sulting 2006,Common Misconceptions about HR Shared Services Economy of scale and depth of expertise is better for business support,Decentralized More competitive local service Few local HR services add distinct value to business. More economical local service Few economies of scale or leverage of technology know the true cost/benefit of service Locals can give better service Small volumes result in frag
