HR Shared Services and HR Operations have become a critical part of today’s successful HR organisations. The last decade many companies went through a major HR transformation program to establish an efficient set up. Usually this means for HR Shared Services the following set up: one single point of contact and contact centres, supported by experts and state of the art technology. The centres provide common and efficient HR services towards all employees and managers across the entire organisation.
In my article, 6 major trends in HR Shared Services, I have described the model and outlined the direction in which many best practice companies further develop their HR Shared Services.
In this article, I describe some additional and new challenges of which some are related directly to the generic HR trends.
Read also: 10 HR Trends for 2017
1. From HR-centric to employee-centric
More and more leaders start to realise they should build their organisation and systems to support the teams and individuals in their organisation, rather than hampering them. Richard Branson makes this clear by stating: “Your employees are your company’s real competitive advantage. They’re the ones making the magic happen—so long as their needs are being met.”
Secondly the expectation of employees of the workplace experience is rapidly changing. They expect the same experience in social media, mobile and technology as they experience outside the company. This trend is described as the ‘consumerisation of HR‘.
Both developments inevitably lead to a major paradigm shift for HR. Until recently HR typically organised all technology, processes and tools around the HR function itself, and partly around the managers, as being the internal clients. Going forward the HR ways of working and selection of tools needs to be much more, if not completely, employee- centric. These trends also implies cost can no longer be the single driver for HR transitions. Focus on cost rather than quality will lead to unwanted inefficiencies which often hamper managers’ and employees’ performance. In turn this will fuel disengagement, not only because of the inefficiencies, but also because it is often systemic for the disinterest of the organisation in supporting employee performance in the best way possible.
HR Operations needs to completely rethink their supporting technology landscape, process design and tools from the perspective of the employee. How to best support individuals and teams to deliver and create an experience for them, as they already know from outside the company.
Examples of possible new functionality are: enablement of employees to find the best skills for their new projects, the ability to initiate and organise performance feedback from peers and managers, ensure employees get automatic recommendations on career opportunities based on their profile and search behaviour, strong knowledge management capabilities, ability to online recommend peers that deserve recognition, availability of self – and team- assessment tools, online learning opportunities and so on.
2. New technology such as HR Apps and Virtual Reality
The fast development in new technologies such as HR Apps and VR is extremely exciting and will support employees in experiencing simple and intuitive tools, which help them to deliver. In previous articles, we provided many examples of helpful apps and VR applications such as in feedback apps and learning.
However, this development also requires ownership and leadership within the organisation to help create the maximum benefits of the new technologies.
Technology empowers employees in areas that were strictly the domain of HR and managers. Implementing these apps will have direct consequences for the current ways of working in the organisation. Policies and processes will need to be reviewed, and changed to be able to leverage these new and exciting innovations. In my previous article on this subject I argue that the most logical owner and initiator to lead these developments is HR Operations. This trend will pose additional leadership challenges for HR operations and will require new capabilities to be developed.
3. From workforce segment management to integral workforce management
In the last decade companies started to use more and more a highly skilled contingent workforce. The high volumes contingent workforce used to consist mainly of lower skilled jobs. These days are long over. In many companies the contingent workforce includes highly skilled professionals from agencies or (independent) consultancies in many functional domains such as IT and Design. In volume the estimates in 2014 were that on average 32% of workforce consisted of contingent workers, expected to further increase to 45 % in 2017 (research from Ardent Partners).
In many companies, however, the people in the contingent workforce are treated as external employees. They are often not a part of: the employee communications, the HRIS, the HR tools, the talent identification process, the engagement surveys, the performance review, and so on. To exclude such a significant and very relevant part of the workforce poses not only obvious financial and legal risks, but also causes more HR strategic challenges.
In many companies the volume and the composition of contingent work force will make it necessary for HR to develop inclusive strategies to manage the complete workforce, rather than only 30-50%. Many HR functions and thus their HR shared services have been reluctant to step into this arena, sometimes even for good legal reasons. But to be able to start managing the integral workforce, these roadblocks must be overcome. This includes overcoming the challenges for HR Operations to integrate contingent workforce into their cliental and start providing services.
4. From transactional to knowledge based
The professional expertise required in HR Shared Services will continue to increase. In the early days, when the services provided were still rather basic data- and HR admin processes also the skills required to fulfil these tasks were equally basic. In the last years the skill requirements started to increase because of the increase in more expert related services. In addition, the skill requirements increased because the HR Shared Services organisations started to be managed as commercial business, focused on cost control, value creation and customer service (Deloitte). By now HR Operations has become a profession, a complete new field in HR with multiple areas of expertise.
Going forward, it is my belief that this development will continue and accelerate. First because in many companies the HR services provided by HR Operations is expanding to the full width of services, including all learning, recruitment, people analytics and generic HR advisory. Secondly the more transactional tasks will continue to be further automated. Thirdly new trends in supporting technology such as in new HR apps, require new skills and expertise. Finally the consumerisation will further increase the demands from the internal clients to continue to professionalize.