(Re)Designing the Hr Organization

Many HR functions have gone through the process of transformation over the past decade. This redefinition of the work of HR is intended to allow a more strategic focus on talent management and organizational capability while systematizing and controlling the cost of transactional work. Little formal consideration has been given, however, to how these new complex HR organizations should be configured to best achieve these goals. This article highlights the operational challenges created by the most common organization design used by HR departments-the business partner model-and presents an emerging model-the solutions center-that is intended to address these flaws. Each model is described and discussed and a set of considerations for the HR leader is offered in order to maximize the effectiveness of the chosen organization design.

Over the last decade there has been a profound shift in the work of the HR function. The publication in 1997 of David Ulrich's Human Resource Champions spurred HR leaders across various industries to realign their organizations in order to undertake "strategic business partner" work. At the same time, a focus on cost-cutting and efficiency aimed at staff functions in general-and at HR in particular-has pushed much HR transactional work into shared services or to out-sourced vendors.

For many HR departments, this process of "transformation," as it is popularly called, has been a wrenching experience. It has required rethinking the fundamental role of the HR function and shirting the definition of the HR "customer" from the traditional focus on the employee to an almost total focus on the management ranks. The goal has been to create an organization that can deliver the necessary, daily (but low value-added) transactional work of HR consistently and efficiently while at the same time undertaking complex consulting and project-based work that is intended to further strategic business initiatives.

Many companies are still in the midst of this process, and it will he a number of years before we know if these changes will have paid off for the organizations they support. In the meantime, much attention has been paid to redefining the new work of HR. However, although most human resource departments have been through one or more major restructurings in the past 10 years, less consideration has been given to how to best configure these new HR organizations.

This article highlights the challe...

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