An increasing number of large and multinational organizations are moving
to shared services models in delivering the human resource function. It is
commonly believed that the adoption of an HR shared services model can
transform the role of HR by enabling the HR function to be more strategic at
the corporate level and more cost-effective at the operational level. However,
few academic studies have been carried out to investigate challenges to implementing
an HR services center successfully and the impact of adopting an
HR shared services model on different groups of employees. Through a case
study of a multinational corporation, this article reveals that there remains a
significant gap between literature espousing the efficacy and utility of HR
shared services and the extent to which the adoption of such a model is successful.
The financial and emotional cost of moving to a shared services
model can outweigh the tangible cost savings predicted by firms. The idea of
separating the HR function into strategic, operational, and administrative
components may prove to be too simplistic, although it underpins the initiative
of HR shared services