FEBRUARY 2023HR TECH OUTLOOK8The shared services model, in which different functions such as finance and accounting, purchasing, IT, and human resources (HR) are centralized and shared across an organization, has been gaining attention since the mid-1980s. By the year 2000, the idea had become widely accepted and organizations across the globe had gradually started their journey to transform. From an HR journey perspective, the progression of the HR shared services (HRSS) model can be divided into three phases:Phase One: The initial adoption of the HRSS model in operation and the transition to an integrated cloud-based human capital management (HCM) system hosting the core HR functions including core HR, payroll, absence, and benefits or pension. Over the past 10-15 years, we see a spike in HR departments moving to a shared services operating model. As of 2020, 75 percent of the Fortune 500 companies have established their own HRSS centers, compared to fifteen years prior. Phase Two: The optimization and expansion of the initial HRSS model, which includes standardizing and simplifying processes, digitizing and automating tasks, as well as incorporating additional HR modules for compensation, recruitment, performance management, learning and development, communication, and DE&I.Phase Three: The achievement of artificial intelligence (AI) and machine learning (ML) empowered, robotic process automation (RPA) based, fully integrated digital HRSS operating model, where RPA is the main delivery source of the repetitive operational transactions and the AI algorithms generate predictions, insights and making operational decisions through processing, evaluating and learning from the everyday data pipeline. Hope Zhang, Director, HR Services & Payroll, Hudson's BayByCurrently, we see many companies either completed or almost completed their transformation to `phase one' or in the beginning or middle of their journey exploring `phase two.' With the future in mind, how do we go from here? The focus in the next few years will be--technology, employee experience, and HRSS team building.Focus on a multi-year HR Technology StrategyTechnology has been a key enabler, which has helped HR technology to progress significantly over the past 20 years, moving from data hosting and on-premises software to cloud-based employee experience platforms. Creating a multi-year HR technology strategy is crucial now more than ever to gradually and sustainably identify, implement and optimize HR technologies that support the company's journey to the final phase, step by step and module by module.On Cloud yet? Cloud technology allows for the storage and operation of real-time data in applications using the internet and eliminates the need for companies to concern themselves with storage capacity, backups, or upgrades.Functional HR Modules: Which HR modules or technologies are desired in your company? Identify and create a roadmap to implement based on the budget, needs, and implementation requirements.HUMAN RESOURCES SHARED SERVICES ­ WHAT NOW?Hope Zhang
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