The HR Shared Service (HRSS) delivery model, with its specialized Centers of Expertise (COEs), represents a significant evolution in how human resources functions are managed within organizations. By centralizing core HR activities, organizations aim to achieve greater efficiency, consistency, and a higher quality of service.

Benefits of an HRSS Delivery Model for Employees and Management

An HRSS delivery model offers numerous advantages for both employees and the management of an organization:

Benefits for Employees:

• Improved Service Quality and Consistency: Employees benefit from standardized processes and clear service level agreements (SLAs). For example, if an employee has a question about their benefits, they know exactly which channel to use (e.g., HR portal, dedicated hotline) and can expect a consistent, accurate response. This contrasts with traditional models where the answer might vary depending on which HR generalist they speak to. A COE for benefits administration ensures that all inquiries are handled by specialists with in-depth knowledge, leading to higher accuracy and faster resolution.
• Faster Access to Information and Support: Self-service portals and centralized contact points (like HR call centers) empower employees to find answers to common questions, update personal information, and initiate requests (e.g., leave applications) at their convenience, often 24/7. This reduces reliance on individual HR representatives and speeds up administrative tasks. For instance, an employee needing to update their address no longer needs to wait for an HR generalist; they can do it instantly through the HR portal.
• Enhanced Employee Experience: By streamlining administrative tasks and providing quick access to information, HRSS allows HR professionals to focus more on strategic initiatives and employee development, which can lead to a more positive overall employee experience. Employees feel more supported when their basic HR needs are met efficiently.
• Increased Fairness and Transparency: Standardized processes and policies applied across the organization by the HRSS team promote fairness and reduce the likelihood of inconsistent application of rules, which can be a source of frustration and demotivation in traditional, decentralized HR models.

Benefits for Management:

• Cost Reduction and Efficiency Gains: By consolidating transactional HR activities, organizations can achieve economies of scale, reduce duplication of effort, and optimize staffing levels. For example, instead of having multiple payroll specialists in each business unit, one central payroll COE can manage the payroll for the entire organization, reducing the overall headcount required for this function. This was a primary driver for many organizations adopting HRSS (Ulrich et al., 2009).
• Strategic Focus for HR: With transactional tasks handled by the HRSS, HR business partners (HRBPs) and COEs can dedicate more time to strategic initiatives such as talent management, organizational development, succession planning, and change management. This shifts HR from an administrative function to a true strategic partner for the business. For instance, a talent acquisition COE can focus on developing advanced recruitment strategies to attract top talent, rather than being bogged down by resume screening.
• Improved Data Analytics and Reporting: Centralized HR data enables more robust reporting and analytics. Management can gain deeper insights into workforce trends, performance metrics, and HR program effectiveness. This data can inform strategic decision-making, such as identifying skill gaps across the organization or evaluating the ROI of training programs.
• Consistency and Compliance: An HRSS model ensures consistent application of HR policies and procedures across all business units, reducing compliance risks and ensuring adherence to labor laws and regulations. This is particularly crucial for large, geographically dispersed organizations.