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HR grows but still lacks time for “strategic” activities


More HR departments have grown in size and influence over the past five years, according to new research published today.

More than half of the 118 organisations in the IRS survey reported that the number of staff in their HR departments had increased over the past five years. This is due to increased workload (57%), a change in employee numbers (50%), and organisational restructuring (41.5%). However, these and efficency improvements are also the most likely reasons why some HR departments have shrunk in size.

Key findings


  • A typical HR department has one member of staff for every 95 employees, and a budget worth 2.66% of total company operating costs.


  • HR is torn between its wish to contribute to the strategic direction of the organisation and the need to handle huge volumes of administrative work. A typical HR department spends just half a day a week on "strategic" activities, but would like to spend a day and a half on this sort of work; it spends a day and a half providing a consultancy service, but would like to find two days a week for this.


  • Administration remains a time-consuming activity that the HR department would like to see outsourced, passed to line managers or reduced through improved technology. A typical HR department spends three days a week on this sort of work. The most time-consuming HR activities are also the most important in just 13% of HR departments surveyed.


  • The most important activities for HR include training and development, change management, and recruitment and retention.


  • "HR" remains the favoured term among HR departments, with 67% using it. The popularity of "personnel" has increased, from 13% in 2003 to 21% in 2004.


  • Around seven in 10 organisations expect HR managers to be qualified, while one-fifth prefer HR managers to hold a qualification.


  • 60% of organisations employ a director with responsibility for HR, although just under half of these also hold responsibility for another area of the business.


  • Just over half of the respondents had a dedicated strategy for the HR department – 86% of large companies compared with 43% of small companies. Three-quarters of service sector organisations operate an HR strategy, compared with 42% of manufacturing companies and just 32% of public sector organisations.


  • Fewer than half of HR departments surveyed measured the effectiveness of their department. The most common tool is through key performance indicators – used by 41%. Typical indicators are attendance/absence levels and staff turnover. Other measuring tools include performance appraisal, employee surveys, customer satisfaction levels and the number of grievance, disciplinary and tribunal cases.


  • 69% can regulate their spending as they have their own budget but this proportion is considerably higher amongst large organisations (92%) and private sector service companies (84%).


  • Public sector HR professionals face uncertainty, as they feel 'very dependent on what happens at the next general election'.

IRS Employment Review Managing Editor, Mark Crail, said: "With the ever-increasing burden of legal changes and the opportunities to align the HR function with organisational strategy, HR professionals have the chance to demonstrate their true value to the business."

For further details on the survey, click here


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