Now, let’s turn to a research-based overview of the HRM function. In this visual you can find an overview of HRM actors and HRM activities they often execute. Please check whether the overview aligns with the list of actors you identified in the previous exercise.
The Corporate HR Department
The corporate HR department is an organizational unit that directly reports to an organization’s top management team. In fact, the head of the corporate HR department – e.g. Vice President of HR or the HR director – may be a member of the top management team of the organization. Often, one of the primary responsibilities of the corporate HR department is to formulate HR policies that ideally align with the strategic objectives of the organization (see also the session on “HRM strategy”). Amongst others, this may involve formulating an employer brand, establishing the capabilities needed to implement business strategies or drafting succession planning policies. To ensure these policies are implemented effectively and consistency throughout the organization, the corporate HR department may set implementation guidelines and coordinate the activities of other HRM function actors (including HR business partners, Centers of Expertise and/or HR shared service centers).
Centers of Expertise
Centers of Expertise (CoE) are consulting units inside the organization that specialize in a selected HRM activity. The “clients” of CoE are HR business partners and/or line managers that turn to CoEs with questions that require specialised HRM knowledge. Accordingly, CoEs may offer support in handling grievance issues, help HR business partners select the ‘right’ HRM activities for an individual business unit, offer training to line managers to build their HRM competences or offer guidance on selecting new employees. To ensure the activities of CoEs align with the organization’s strategy as well as the needs of individual business units, CoEs often report to both the corporate HR department and the business units they serve.
HR Shared Service Centers
HR shared service centers (SSCs) are responsible for the execution of operational HRM activities. Besides executing administrations related to compensation and benefits, (e.g. payroll administration) and selection (e.g. drafting employment contracts), HR SSCs also often operate call centres that HR business partners, line managers and/or employees can turn to when having HR administration-related questions (e.g. how to apply for maternity leave, how to do pension planning, which employee benefit schemes to select, etc.). On top of this, HR SSCs may be engaged in what operational HRM activities in areas such as recruitment (e.g. publishing job advertisements), selection (e.g. executing assessment centers) and training (e.g. offering workshops to employees). In theory, HR SSCs are under the full control of (and thus have to report to) the business units they serve. In practice however, due to their involvement in executing HR policies, HR SSCs often have to report to the corporate HR department as well.
HR outsourcing vendors
HR outsourcing vendors are responsible for the execution of operational HRM activities. In this respect, they are similar to HR shared service centers, in that they execute HR administrations and/or operational activities in areas such as compensation and benefits (e.g. payroll companies) or training and development (e.g. professional training instuttes). While HR shared service centres reside within the boundaries of the firm, HR outsourcing vendors are independent businesses. While they reside outside the boundaries of the organization, HR outsourcing vendors have a more arm’s length relationship with the organizations they serve. In selected cases, organizations may decide to consolidate HRM activities in internal HR shared service centres, before outsourcing these activities to an outsourcing vendor. In most cases, the corporate HR department represents the organization vis-à-vis the HR outsourcing vendor.
HR business partners
HR business partners (HRBPs) work directly with line managers and a business unit’s leadership team to clarify HR policies and tailor HR practices to the needs of an individual business unit. Accordingly, HRBPs may also be referred to as “embedded HR professionals” (i.e. embedded in a business unit). HRBPS may assist line managers in making a long-term personnel planning, join line managers during selection interviews or help employees with their personal development plans. Besides reporting a business unit’s leadership team, HRBPs may also report to the corporate HR department.
Line managers are seen to be at the front line of HRM implementation. After all, they are in direct and daily contact with employee. Accordingly, line managers are responsible for hiring new workers, discussing employees’ development plans, conducting appraisal talks and/or offering employees the possibility to participate in decision making. Besides these operational HRM activities, line managers are also responsible for approving employees’ HR-related requests (e.g. applying for leave or other secondary benefits). In case line managers need support, they can turn to HR business partners, centers of expertise or HR shared service centers for help.
Although employees may be considered the “objects” of HRM activities, or better, the recipients of HRM activities, they are also actively involve in executing them. For instance, in order for performance appraisal to be implemented by a line managers, employees have to prepare and take part in annual talks. Moreover, without the active participation of employees, training activities will not be ‘implemented’. As such, one may argue that employees and line managers together co-create HRM activities. The involvement of employees in HRM is further evidenced by employees operating self-service technologies that allow employees to make use of employee benefits (e.g. applying for leaving, pension planning, etc.). Often, such self-service technologies are offered by HR shared services.
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