Shrm poll shared_servicesfinal

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Shrm poll shared_servicesfinal

  1. 1. SHRM Poll: Shared Services and Centers of Excellence July 23, 2010
  2. 2. SHRM Poll: Shared Services and Centers of Excellence Contents:  Introduction  Shared Services Centers  Centers of Excellence  Results by Organizations That Do Not Use a Shared Services/Centers of Excellence HR Transaction Model  Methodology Shared Services & Centers of Excellence | ©SHRM 2010 2
  3. 3. Introduction This study examined the shared services centers (consolidated administrative HR functions) and centers of excellence (localized areas of in-depth HR expertise) models used for administering HR transactions and services. The shared services model, as envisioned by Dave Ulrich, is a way to promote HR expertise and deliver improved services companywide through the division of tasks and expertise. Shared Services & Centers of Excellence | ©SHRM 2010 3
  4. 4. Shared Services Centers Shared Services & Centers of Excellence | ©SHRM 2010 4
  5. 5. Does your company administer and deliver HR transactions through an internal and central shared services department? No, 25% Yes, 75% Note: n = 484. Shared Services & Centers of Excellence | ©SHRM 2010 5
  6. 6. Does your company administer and deliver HR transactions through an internal and central shared services department? (Differences by organization demographics) • Publicly owned for-profit organizations (74%) were more likely than nonprofit organizations (53%) to administer and deliver HR transactions through an internal and central shared services department. • Large-staff-sized organizations (500 or more employees) (78%) were more likely than small-staff-sized organizations (1 to 99 employees) (62%) or medium-staff-sized organizations (100 to 499 employees) (63%) to administer and deliver HR transactions through an internal and central shared services department. • Organizations with multinational operations (75%) were more likely than organizations with single country operations (64%) to administer and deliver HR transactions through an internal and central shared services department. Shared Services & Centers of Excellence | ©SHRM 2010 6
  7. 7. What business model does your company use to administer and deliver HR transactions? Completely in-house shared services Completely outsourced shared services A combination of in-house and outsourced shared services 37% 61% 2% Note: n = 352. Only respondents who indicated that they administer and deliver HR transactions through an internal and external shared services department were asked this question. Shared Services & Centers of Excellence | ©SHRM 2010 7
  8. 8. What business model does your company use to administer and deliver HR transactions? (Differences by organization demographics) • Government agencies (58%) were more likely than publicly owned for-profit organizations (24%) or nonprofit organizations (21%) to use completely in-house shared services. • Publicly owned for-profit organizations (72%), privately owned for-profit organizations (68%) and nonprofit organizations (79%) were more likely than government agencies to use a combination of in-house and outsourced shared services. Shared Services & Centers of Excellence | ©SHRM 2010 8
  9. 9. To what degree has your company's shared services organization… To a large degree To some degree To a slight degree Not at all 3% lost endorsements and support from the business 18% 27% 52% unit(s) and local leaders it serves? (n = 267) 4% decreased employee satisfaction with HR service 18% 36% 43% delivery? (n = 267) gained endorsements and support from the business 32% 48% 11% 9% unit(s) and local leaders it serves? (n = 276) increased employee satisfaction with HR service 26% 50% 17% 7% delivery? (n = 277) 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Note: Percentages may not total 100% due to rounding. Shared Services & Centers of Excellence | ©SHRM 2010 9
  10. 10. To what degree has your company's shared services organization… (Differences by organization demographics) • Increased employee satisfaction with HR service delivery > Privately owned for-profit organizations reported greater average degrees of increased employee satisfaction with HR service delivery than publicly owned for- profit organizations. > Organizations with single country operations reported greater average degrees of increased employee satisfaction with HR service delivery than organizations with multinational operations. • Decreased employee satisfaction with HR service delivery > Publicly owned for-profit organizations reported greater average degrees of decreased employee satisfaction with HR service delivery than privately owned for-profit organizations or government agencies. > Large-staff-sized organizations reported greater average degrees of decreased employee satisfaction with HR service delivery than small-staff-sized organizations. Shared Services & Centers of Excellence | ©SHRM 2010 10
  11. 11. What are the top three positive outcomes your company has experienced as a result of its shared services center? Reduced HR staff time spent on administrative tasks 37% Reduced administrative costs 36% Consolidated redundant HR functions 33% Better tracking of employee data 31% Improved efficiency of operations 25% Greater strategic functioning of HR 19% Reduced/eliminated paper-based record keeping 18% Reduced routine HR-related calls/emails from employees 14% Reduced transaction errors 14% Improved employee satisfaction with basic HR transactions 11% Maintained (i.e., did not see an increase in) administrative costs 9% Improved ability to calculate metrics around HR functions 3% Other 1% 0% 10% 20% 30% 40% Note: n = 247. Percentages do not total 100% as multiple response options were allowed. Shared Services & Centers of Excellence | ©SHRM 2010 11
  12. 12. What are the top three positive outcomes your company has experienced as a result of its shared services center? (Differences by organization demographics) • Improved employee satisfaction with basic HR transactions > Privately owned for-profit organizations (19%) were more likely than publicly owned for-profit organizations (6%) to report improved employee satisfaction with basic HR transactions. • Reduced transaction errors > Medium-staff-sized organizations (22%) were more likely than small-staff-sized organizations (5%) to report reduced transaction errors. • Reduced HR staff time spent on administrative tasks > Large-staff-sized organizations (48%) were more likely than medium-staff-sized organizations (28%) to report reduced HR staff time spent on administrative tasks. • Reduced administrative costs > Organizations with multinational operations (44%) were more likely than organizations with single country operations (27%) to report reduced administrative costs. > Organizations with unionized workforces (49%) were more likely than organizations with non-unionized workforces (30%) to report reduced administrative costs. Shared Services & Centers of Excellence | ©SHRM 2010 12
  13. 13. What are the top three positive outcomes your company has experienced as a result of its shared services center? (Differences by organization demographics, continued) • Consolidated redundant HR functions > Organizations with multinational operations (40%) were more likely than organizations with single country operations (27%) to report consolidated redundant HR functions. > Organizations with unionized workforces (45%) were more likely than organizations with non-unionized (30%) workforces to report consolidated redundant HR functions. • Greater strategic functioning of HR > Organizations with single country operations(26%) were more likely than organizations with multinational operations (13%) to report greater strategic functioning of HR. • Reduced/eliminated paper-based record keeping > Organizations with single country operations (24%) were more likely than organizations with multinational operations (13%) to report reduced/eliminated paper-based record keeping. Shared Services & Centers of Excellence | ©SHRM 2010 13
  14. 14. What are the top three challenges your company has experienced with its shared services model? Employee resistance toward the shared services model 43% Transitioning from traditional HR delivery to the shared services model 40% Shifting HR staff roles and responsibilities 37% Difficulty with the IT infrastructure to support automated, web- 30% based HR functions Performance metrics for this model have not been effectively 27% tracked Time to implement the shared services model was lengthier than expected 24% Expected HR staff time savings not achieved 23% Difficulty with outsourced portions of HR services 22% Negative impact on relationship between HR staff and other company employees 18% Expected cost reductions not achieved 10% Other 4% 0% 10% 20% 30% 40% 50% Note: n = 235. Percentages do not total 100% as multiple response options were allowed.“Not sure” and “none” responses were excluded from this analysis. Shared Services & Centers of Excellence | ©SHRM 2010 14
  15. 15. What are the top three challenges your company has experienced with its shared services model? (Differences by organization demographics) • Negative impact to the relationship between HR staff and other company employees > Organizations with multinational operations (26%) were more likely than organizations with single country operations (11%) to report negative impact to the relationship between HR staff and other company employees. > Organizations in the midwest (27%) were more likely than organizations in the northeast (3%) to report negative impact to the relationship between HR staff and other company employees. • Performance metrics for this model have not been effectively tracked > Organizations with single country operations (37%) were more likely than organizations with multinational operations (19%) to report that performance metrics for this model have not been effectively tracked. Shared Services & Centers of Excellence | ©SHRM 2010 15
  16. 16. What are the top three challenges your company has experienced with its shared services model? (Differences by organization demographics, continued) • Employee resistance toward the shared service model > Organizations with unionized workforces (62%) were more likely than organizations with non-unionized workforces (38%) to report employee resistance toward the shared service model. • Transitioning from traditional HR delivery to the shared service model > Large-staff-sized organizations (48%) were more likely than medium-staff-sized organizations (27%) to report transitioning from traditional HR delivery to the shared service model. Shared Services & Centers of Excellence | ©SHRM 2010 16
  17. 17. Is the shared services center just for your location or the entire company? Just this location Multiple locations but not the entire company Entire company 3% 16% 80% Note: n = 219. HR professionals who were employed by a single location/business unit company did not answer this question. Shared Services & Centers of Excellence | ©SHRM 2010 17
  18. 18. How many separate locations are served by shared services? 80% 71% 70% 60% 50% 40% 30% 15% 13% 20% 10% 1% 0% One location Two to five locations Six to 10 locations 11 or more locations Note: n = 207. HR professionals who were employed by a single location/business unit company and responded that their organization’s shared service center was just for their location did not answer this question. Shared Services & Centers of Excellence | ©SHRM 2010 18
  19. 19. How many separate business units are served by shared services? 46% 50% 40% 30% 23% 22% 20% 8% 10% 0% One business unit Two to five Six to 10 business 11 or more business units units business units Note: n = 215. HR professionals who were employed by a single location/business unit company and responded that their organization’s shared service center was just for their location did not answer this question. Shared Services & Centers of Excellence | ©SHRM 2010 19
  20. 20. Which services are offered through an HR shared services department? Health care benefits administration 88% Flexible spending account administration 68% Retirement benefits administration 66% Payroll 65% Leave administration 60% Employee data collection and maintenance 48% Employee assistance/counseling 47% Recruiting support 43% Time keeping 39% Pension administration 39% Work/life benefits administration 38% Performance management 37% Training and development 36% Onboarding support 33% Compensation planning 32% Other benefits (i.e., not health care, retirement, leave or work/life)… 28% Relocation services 27% Information services 26% Expense reimbursement 24% Stock/share administration 18% Expatriate administration 12% Other 3% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Note: n = 234. Percentages do not total 100% as multiple response options were allowed. Shared Services & Centers of Excellence | ©SHRM 2010 20
  21. 21. Which services are offered through an HR shared services department? (Differences by organization demographics) • Relocation services > Publicly owned for-profit organizations (40%) were more likely than government agencies (12%) to report offering relocation services through an HR shared services department. > Organizations with multinational operations (38%) were more likely than organizations with single country operations (16%) to report offering relocation services through an HR shared services department • Stock/share administration > Publicly owned for-profit organizations (30%) were more likely than nonprofit organizations (7%) to report offering stock/share administration through an HR shared services department. > Organizations with multinational operations (24%) were more likely than organizations with single country operations (14%) to report offering stock/share administration through an HR shared services department Shared Services & Centers of Excellence | ©SHRM 2010 21
  22. 22. Which services are offered through an HR shared services department? (Differences by organization demographics) • Pension administration > Organizations with unionized workforces (58%) were more likely than organizations with non-unionized workforces (32%) to report offering pension administration through an HR shared services department. > Medium- and large-staff-sized organizations were more likely than small-staff-sized organizations to report offering pension administration through an HR shared services department. • Other benefits administration > Large-staff-sized organizations were more likely than medium-staff-sized organizations to report offering other benefits (i.e., not health care, retirement, leave or work/life) administration through an HR shared services department. • Payroll > Organizations with multinational operations (73%) were more likely than organizations with single country operations (58%) to report offering payroll through an HR shared services department. Shared Services & Centers of Excellence | ©SHRM 2010 22
  23. 23. Which services are offered through an HR shared services department? (Differences by organization demographics) • Retirement benefits administration > Organizations in the southeast (80%) were more likely than organizations in the northeast (52%) to report offering retirement benefits administration through an HR shared services department. • Flexible spending account administration > Publicly owned for-profit organizations (75%) were more likely than government agencies (44%) to report offering flexible spending account administration through an HR shared services department. Shared Services & Centers of Excellence | ©SHRM 2010 23
  24. 24. Centers of Excellence Shared Services & Centers of Excellence | ©SHRM 2010 24
  25. 25. Do you have centers of excellence that offer HR services/functions? Yes, 49% No, 51% Note: n = 222. Shared Services & Centers of Excellence | ©SHRM 2010 25
  26. 26. Which services do the centers of excellence provide? Training and education program planning and administration, mentoring, coaching 75% Recruiting, recruiting and staffing administration or recruiting and hiring policies 73% Employee relations 63% Performance management 58% HR policy development 57% Total rewards planning 53% Organizational design and change processes 51% Diversity programs 50% Legal 46% Succession planning 45% Other 5% 0% 10% 20% 30% 40% 50% 60% 70% 80% Note: n = 102. Percentages do not total 100% as multiple response options were allowed. Shared Services & Centers of Excellence | ©SHRM 2010 26
  27. 27. Which services do the centers of excellence provide? (Differences by organization demographics) • Employee relations > Organizations with single country operations (76%) were more likely than organizations with multinational operations (50%) to report providing employee relations through centers of excellence. > Organizations with non-unionized workforces (74%) were more likely than organizations with unionized workforces (40%) to report providing employee relations through centers of excellence. • HR policy development > Privately owned for-profit organizations (74%) were more likely than publicly owned for-profit organizations (44%) to report providing HR policy development through centers of excellence. • Other services > Organizations with unionized workforces (13%) were more likely than organizations with non-unionized workforces (1%) to report providing other services through centers of excellence. Shared Services & Centers of Excellence | ©SHRM 2010 27
  28. 28. Over time, to what degree have the services of your central centers of excellence… To a large degree To some degree To a slight degree Not at all 1% decreased employee satisfaction with HR service delivery? (n = 95) 14% 36% 49% increased employee satisfaction with HR service delivery? (n = 99) 23% 48% 15% 13% 1% lost endorsements and support from the business unit and local 15% 34% 50% leaders it serves? (n = 94) gained endorsements and support from the business unit and local 42% 35% 13% 10% leaders it serves? (n = 100) 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Note: Percentages may not total 100% due to rounding. Shared Services & Centers of Excellence | ©SHRM 2010 28
  29. 29. Over time, to what degree have the services of your central centers of excellence… (Differences by organization demographics) • Increased employee satisfaction with HR service delivery > Privately owned for-profit organizations reported greater average degrees of increased employee satisfaction with HR service delivery than publicly owned for- profit organizations. Shared Services & Centers of Excellence | ©SHRM 2010 29
  30. 30. Does your company have decentralized HR generalists in separate business units and/or individual locations? No, 42% Yes, 58% Note: n = 232. Shared Services & Centers of Excellence | ©SHRM 2010 30
  31. 31. Does your company have decentralized HR generalists in separate business units and/or individual locations? (Differences by organization demographics) • Publicly owned for-profit organizations (71%) were more likely than government agencies (35%) to report having decentralized HR generalists in separate business units and/or individual locations. • Organizations with multinational operations (72%) were more likely than organizations with single country operations (44%) to report having decentralized HR generalists in separate business units and/or individual locations. Shared Services & Centers of Excellence | ©SHRM 2010 31
  32. 32. Organizations That Do Not Use a Shared Services/Centers of Excellence HR Transaction Model Shared Services & Centers of Excellence | ©SHRM 2010 32
  33. 33. What is the primary reason for your company not adopting a shared services business model? No perceived need for this HR service delivery model for our organization 46% Concerns about lowered employee satisfaction with HR service 12% delivery Concerns about cost escalation 10% Lack of upper management support for this HR service delivery 10% model Model development/implementation in progress 9% Concerns about loss of support from the business units regarding HR service delivery 3% Current outsourcing arrangement of HR functions works well 1% Other 10% 0% 10% 20% 30% 40% 50% 60% Note: n = 102. Shared Services & Centers of Excellence | ©SHRM 2010 33
  34. 34. Does your company plan to change to a shared services/centers of excellence HR transactions model? 50% 42% 37% 40% 30% 20% 10% 7% 10% 5% 0% Yes, within Yes, within Yes, within No Not sure 12 months 13 to 24 the next 2 to months 5 years Note: n = 104. Only respondents who indicated that their organizations did not administer and deliver HR transactions through an internal and external shared services department were asked this question. Shared Services & Centers of Excellence | ©SHRM 2010 34
  35. 35. Does your company plan to change to a shared services/centers of excellence HR transactions model? (Differences by organization demographics) • Among organizations that do not currently administer and deliver HR transactions through shared services/centers of excellence: > Nonprofit organizations (81%) were more likely than publicly owned for-profit organizations (35%) to indicate that they do not plan to change to a shared services model. > Organizations with multinational organizations were more likely than organizations with single country operations to indicate that they plan to change to a shared services model within 13 to 24 months (23% compared with 5%) or within the next 2 to 5 years (18% compared with 3%). > Organizations with single country operations (78%) were more likely than organizations with multinational operations (36%) to indicate that they do not plan to change to a shared services model. Shared Services & Centers of Excellence | ©SHRM 2010 35
  36. 36. Demographics: Organization Sector 40% 37% 33% 30% 20% 16% 11% 10% 3% 0% Publiclyowned for- Privatelyowned for- Nonprofit Government Other profit profit Note: n= 330 Shared Services & Centers of Excellence | ©SHRM 2010 36
  37. 37. Demographics: Location Staff Size 39% 39% 40% 30% 22% 20% 10% 0% Small (1 to 99 employees) Medium (100 to 499 Large (500 or more employees) employees) Note: n = 316. Shared Services & Centers of Excellence | ©SHRM 2010 37
  38. 38. Demographics: Organization Operations Multinational, 45% Single country, 55% Note: n = 324 Shared Services & Centers of Excellence | ©SHRM 2010 38
  39. 39. Demographics: Union Status Union, 27% Non-union, 73% Note: n = 328 Shared Services & Centers of Excellence | ©SHRM 2010 39
  40. 40. Demographics: Region 37% 40% 28% 30% 19% 20% 16% 10% 0% Northeast Southeast Midwest West Note: n = 316 Shared Services & Centers of Excellence | ©SHRM 2010 40
  41. 41. SHRM Poll: Shared Services & Centers of Excellence Methodology • Response rate = 18% • Sample comprised 484 HR professionals from SHRM’s membership who were employed by organizations with 250 or more employees. • Margin of error is +/- 4% • Survey fielded May 6 – May 12, 2010 For more poll findings, visit: www.shrm.org/surveys Follow us on Twitter: http://twitter.com/SHRM_Research Shared Services & Centers of Excellence | ©SHRM 2010 41
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