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HR departments strive to be more strategic

From the National Computing Centre, Manchester UK.
For issue 28th February 2011

Transformation is very much the order of the day for Human Resources (HR)departments due to a mixture of changing working patterns, evolving organisational needs and the ever present requirement to deliver a varied range of services more cost effectively. In fact 34% of HR departments have experienced significant reorganisation in the past year and a further 43% in the last 1-2 years. This is according to new research undertaken by the National Computing Centre’s Evaluation Centre service an interactive online service guiding IT buyers in the selection and use of business software, services and technology.

The major driver for change is to enable the HR department to become a more strategic contributor to the business rather than merely an administrative operation, mentioned by over half the respondents (51%). Hand-in-hand with this, 40% state the need to reposition the HR function to better fit the evolving role and structure of the wider organisational model. Reducing costs is another significant factor for 34% of organisations and the need to improve service delivery is a requirement for 26%.

A viable alternative to organisations maintaining all their own on-premise HR solutions is to adopt a Software as a Service (SaaS) model. This allows software to be purchased from a supplier on an annual per-user licence, with the software being maintained and enhanced by the supplier. So far this option has been adopted by 14% of the respondents for delivering all or some of their HR functions. Another 6% are evaluating its use, while 28% may consider it in the future compared to 26% who have no intention of doing so.

Steve Fox, Evaluation Centre Managing Director, commented: “With the current pressure on the HR department to adopt new ways of working then using a Software as a Service approach can be a cost-effective way of bringing about change quickly.”

A key part of the HR department’s transformation to a more strategic role is the provision of self-service capabilities. This allows employees and managers to directly input and retrieve information without the involvement of HR, so reducing HR’s administrative load and freeing it to concentrate on higher value activities. To date, 60% of companies have adopted self-service capabilities, 9% plan to do so and 26% have no plans to move in this direction.

Another increasingly popular approach for delivering HR services is the creation of shared service centres: 40% of the companies interviewed have already implemented a shared service centre, 14% are planning to and 6% are evaluating the option, the key benefit being the opportunity to cut administration costs, mentioned by 80%. Other factors are that it allows the concentration of skills and expertise to deliver a better service (40%) and the implementation of best practice to improve HR processes (37%).

Those companies using shared services report encouraging results, with 86% saying they have been successful and no company stating it was a failure.

Survey statistics:

For this study, we asked over 100 companies for their opinions on a number of issues relating to the development of their HR systems. Among the market sectors represented are public sector (28%), IT & telecoms (8%), professional services (8%), banking & finance (6%), distribution & logistics (6%) and publishing & media (6%).

The respondents represented a spread of different sized organisations with 17% in excess of £5 billion turnover, 14% in the £1 billion to £5 billion bracket and 11% in the £500 million to £1 billion range.

In the mid-market 32% are between £100 million and £500 million and 10% in the £50 million to £100 million.

At the smaller end, 10% have a turnover between £10 million and £50 million and 6% are not for profit organisations.

The survey is available from http://www.evaluationcentre.co.uk/hr_software_payroll_software/home.go

NOTE TO EDITORS

About The National Computing Centre (NCC)
The National Computing Centre (NCC) is an independent organisation that helps IT decision makers deliver effective solutions to business problems by bringing together users, experts and vendors to share experiences and develop best practices.

About Evaluation Centre
Evaluation Centre (www.evaluationcentre.co.uk) is an interactive service for end users and consultants to assist them in the procurement process for software, services and technology.

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