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Centralized vs. decentralized HR
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Centralized vs. decentralized HR
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Currently, our plant HR managers report directly to their respective plant managers (6 in total). Any thoughts on the pros and cons of leaving the structure as is vs. having the plant HR managers repo
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Forums » Topic Forums » General Forum » Centralized vs. decentralized HR
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Centralized vs. decentralized HR
posted at 10/27/2009 5:59 AM EDT
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Posts: 1
First: 10/27/2009 Last: 10/27/2009 |
Currently, our plant HR managers report directly to their respective plant managers (6 in total). Any thoughts on the pros and cons of leaving the structure as is vs. having the plant HR managers report directly to the HR function? I have to make a recommendation to my VP and would like some additional insight. Thanks. |
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Centralized vs. decentralized HR
posted at 10/27/2009 6:15 AM EDT
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Posts: 155
First: 8/24/2009 Last: 2/9/2010 |
I'd start with the question...Who is their customer? I'd follow that up with are the HR Managers at the plant graded on plant productivity even though it may only be HR specific productivity (nebulous items like turnover, time to hire, pct of disciplinary actions per employee, etc)?
If the customer is the Plant manager and the measurement is plant productivity then the only answer is to leave things as they are. Now, if someone simply wants to make a change then the next question would be "what is the value added from the change?" If the value added is some HR person feels better because they have more direct reports or they simply have always done it that way then that is the wrong answer. If the answer is better organizational performance/productivity, and that can be modeled and demonstrated (projected financially or other measurement) then make the change. |
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Centralized vs. decentralized HR
posted at 10/27/2009 12:01 PM EDT
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Posts: 50
First: 11/21/2005 Last: 11/2/2009 |
Amen, there is a business trend to have shared services that are centralized, but it doesn't always mean more efficiency or lowered cost.
Customer service is almost always compromised, it doesn't have to be detrimental, but it does mean that everyone might have to learn to do things differently. It might not be worth it. |
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Centralized vs. decentralized HR
posted at 10/30/2009 1:47 PM EDT
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Posts: 2442
First: 2/12/2000 Last: 9/14/2011 |
Shared services is not intended to replace the business partner function. It is merely the gathering up of administrative tasks and doing them more effectively and efficiently with less labor. Do not confuse this with Centralized HR. |
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Centralized vs. decentralized HR
posted at 12/15/2009 4:41 AM EST
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Posts: 1
First: 12/15/2009 Last: 12/15/2009 |
It depends if HR is Administratvie in nature, or a true Business Partner. To be more effective, HR should report directly to HR with a dotted line to Plant Manager for daily operations. When HR is in a capacity to monitor and evaluate EEO, Harrassament, Policy Adherence, etc. it is difficult to tell your manager that they need to make changes. When HR is on an equal plane as the Plant Mgr, advising on policy and impletmenting change, is easier. It is sometimes difficult for an employee (HR Manager) to tell their boss (Plant Manager) that they are handling a situation incorrectly. The organization is better served when HR is functional and reports to the CEO. |
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Centralized vs. decentralized HR
posted at 12/15/2009 5:17 AM EST
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Posts: 155
First: 8/24/2009 Last: 2/9/2010 |
Sorry Debbie but I disagree. If HR is a true "business partner" (one of the more over used euphemisms to describe HR) then it not only is a separate function but it's key operating components report through and to operations.
Anything else, especially given the enforcement role you indicate is setting HR above all others in the organization. While in my experience ethically they may well be they cannot be a true partner of anything if they attempt to be so. |
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Centralized vs. decentralized HR
posted at 12/15/2009 8:58 AM EST
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Posts: 9
First: 1/27/2009 Last: 3/18/2010 |
In essence, Debbie and HR PRO are both right in their arguements. I don't think it really matters where field HR reports to. At the end of the day, regardless of where HR reports, the field HR function has 2 bosses. To be effective, one must be able to manage both masters equally. At GE, we had both models operating within various businesses. The effective HR people were adept at managing their solid-line and dotted-line managers. I do think that the CHRO must report to the CEO. That shouldn't even be negotiable. |
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Centralized vs. decentralized HR
posted at 12/15/2009 1:06 PM EST
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Posts: 1
First: 12/15/2009 Last: 12/15/2009 |
The answer depends on what the HR staff does. HR jobs that provide direct services do not have to be centralized: e.g. analyzing jobs, investigating employee complaints, resolving grievances, internal recruitment; etc. Decentralized staff can handle these matters quickly and more effectively because they tend to have better knowledge of the people involved and the local issues. On the other hand, HR needs to be at the highest organization level possible if they devote their time to activities like planning, creating and modifying programs, program assessment, oversight of service providers, or addressing other organization-wide issues. Those activities need to be centralized because they affect everyone, they take time, they require broad knowledge of organizational needs, and they require top management involvement. Centralized may mean at corporate, at the company level under the local CEO/COO, or even reporting to the head of a lower organizational unit if there is enough work to justify it. You may need centralized AND decentralized, depending on how big your company is, who does the stragetic-type work (i.e. corporate or local), and how much of the latter there is. |
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Centralized vs. decentralized HR
posted at 12/15/2009 4:26 PM EST
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Posts: 155
First: 8/24/2009 Last: 2/9/2010 |
I think AlbertaJane is on the right track. Certain functions can easily be centralized, e.g. benefits. I am not a fan of HR being the sole owner of "analyzing jobs, investigating employee complaints, resolving grievances, internal recruitment" because to do the job right they cannot be. They can be active players and can lend expertise, but they do not and should not totally own the process. (Goes back to the Dr. Sullivan issue of HR Generalists being dinosaurs)
The top HR person in the organization should report to the CEO (as dlhhr shared) and be on the same position level as the CFO, CIO and any other Chief Officer role. To assign it elsewhere devalues HR and sends the wrong message throughout the company. |
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Centralized vs. decentralized HR
posted at 12/18/2009 9:23 AM EST
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Posts: 4
First: 11/15/2006 Last: 12/18/2009 |
As a Plant Manager, I hated it when the new owners transfered the reporting of my HR Manager to corporate staff. It was a policy move, but felt like an insult, and was one of the reasons I left that company.
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