covered by the IRS 2004b survey, there was on average one HR practitioner for every
109 employees.
The ratio is affected by all the factors mentioned above and can only be decided
empirically by analysing what HR services are required and then deciding on the
extent to which they are provided by full-time professional staff or can be purchased
from external agencies or consultants. The degree to which the organization believes
that the management of human resources is the prime responsibility of line managers
and team leaders affects not only the numbers of HR staff but also the nature of the
guidance and support services they provide.
There are, therefore, no absolute rules for organizing the HR function, but current
practice suggests that the following guidelines should be taken into account:
● The head of the function should report directly to the chief executive and should
be on the board, or at least be a member of the senior management or leadership
team, in order to contribute to the formulation of corporate strategies and play a
full part in the formulation and integration of HR strategies and policies. In prac-
tice, however, this does not happen as frequently as one would wish. Only four
out of 10 of the organizations surveyed by IRS in 2004 had a director with sole
responsibility for HR.
● In a decentralized organization, subsidiary companies, divisions, or operational
units should be responsible for their own HR management affairs within the
framework of broad strategic and policy guidelines from the centre.
● The central HR function in a decentralized organization should be slimmed down
to the minimum required to develop group human resource strategies and poli-
cies. It will probably be concerned with resourcing throughout the group at senior
management level and advising on both recruitment and career development. It
may also control remuneration and benefits policies for senior management. The
centre may co-ordinate industrial-relations negotiating if bargaining has been
decentralized, especially where bargaining is related to terms and conditions such
as hours of work, holidays and employee benefits. Although rates of pay may
vary among subsidiaries, it is generally desirable to develop a consistent
approach to benefit provision. A recent development is to operate as a ‘service
centre’, providing shared HR services to other parts of the organization, as
described later in this chapter.
● The HR function has to be capable of delivering the level of advice and services
required by the organization. Delivery may be achieved by the direct provision of
services but may be outsourced.
● The function will be organized in accordance with the level of support and
services it is required to give and the range of activities that need to be catered for,
58 ❚ Managing people