Featured Profile

Will Hutton

Will Hutton

Principal, Hertford College, Oxford University and chair of the Big Innovation Centre

Wednesday 29 Aug 2012
New service models – where next?

New service models – where next?

What trends do we see today that will impact how HR service is done tomorrow? There are a number of underlying movements that have broad implications across all sizes of companies - but particularly those that are larger or more global in nature.

Global business services in larger companies. Often these units encompass HR, finance, procurement, and IT. These are very easily outsourced, before or after centralising. The trend some years ago was to outsource across many of these functional areas as a single unit. Now we see a trend towards outsourcing each part individually, as the people, process and technology links between them are less clear. Often key services are specialist, requiring detailed experience and knowledge. This know-how drives quality of service and this quality impacts the costs in the rest of your business tenfold. As Sir Henry Royce (Rolls Royce) said "the quality is remembered long after the price is forgotten". If you employ people in places where education and skillsets are low and engagement with the end client is poor, then the temptation is to embed all the intelligence in the technology, not in the people. This means poor engagement, inconclusive service delivery, slow and expensive change and therefore unhappy and unproductive employees. This generates noise, cost and management distraction in your business, distracting them from revenue and profit growth.

Proper partnership approach with a more consultative and knowledge sharing environment. This means much more of a "one team" feeling and driving towards proper end-to-end process improvements. Driving out inefficiency requires both provider and customer to change practices and activities and generates real value in your business. In this model, how risk and rewards are shared is often open to new ideas and we see these being played out currently.

Split on-and-offshore. How do you get the best of both worlds? The cultural fit of onshore services, with the cost of offshore delivery. We see organisations, like our own, having onshore front office and contact centres, with tools in place to help the offshoring of some of the more repeatable processes. This drives companies and suppliers to think about how to control training, process performance, reporting and improvement programmes across boundaries of geography, technology and culture; we have seen this can be highly effective.

Continued pace of change. Organisational pace of change is not reducing. This means that services provided need to keep up and help promote change, rather than drag it back. This has implications for many things:-

  • How close the support function is to the business to help plan the change
  • How flexible the technology is to cope with next week's demands (ERPs are traditionally very poor at this)
  • How much you automate, with higher cost to set it up, and longer times until it's live and working
  • How much you train and how to keep close to those actually delivering day-by-day
  • How much time and focus you have on future improvements, rather than keeping the lid on yesterday's workload challenges.

The next steps look interesting from a number of perspectives, but one thing is for sure; tomorrow will be more complex, more fast-paced, and more dynamic than yesterday.

Nick Laird, chief commercial officer at Ceridian UK