A Introduction

Over the past decade, the Threefold Model proposed by Dave Ulrich (1997) has developed into a popular form of organizing Human Resources (HR) in large corporations worldwide. The model postulates that Human Resources should be transformed from a purely administrative function into a strategic partner of the operating business.

The central point of the model is a division of HR functions into three discrete elements: Business Partners, Shared Services, and Competence Centers. Ideally, those who were formally employed in a more general role as Human Resources Officers should be freed from administration-intensive routine work in order to take charge of strategic duties as Business Partners. They support line managers in the operating business proactively, thereby actively contributing to corporate value (Doyé 2004).

The model strongly builds on a centralized HR organization. The administrative activities are removed from the different business units, as are most HR processes and services that are duplicated separately across several divisions and are therefore redundant, and are brought together in an economically independent area of accountability called Shared Service Center. This organizational unit is normally still owned by the corporation but could also transferred outside of company boundaries (so called Business Process Outsourcing). From there, the administrative activities are provided centrally and the HR requirements of employees throughout the company are served using a high degree of standardization and automation (Wagner 2006). Competence Centers bundle knowledge and consist of specialists whose task it is to provide the other two columns with the information that they require to fulfill their tasks. Other scholars had previously made similar arguments, yet did not receive the attention paid to Ulrich (e.g. Wunderer XXXX).

For large companies with many decentralized organizational units, the model promises far-reaching rationalization gains. Because of the presence of high volume and standardized transactions it is very simple to generate learning curves, continuous improvement, and economies of scale for the internal administration of employees. The advantageousness of Shared Service Centers at least in terms of cost efficiency compared to conventional structures is considered uncontroversial and literature on the cost benefits in these types of activities is ubiquitous (for many: Wißkirchen 2002).

However, in realm that the costs of the administration of staff is usually marginal in light of the total costs of a company, the advantage of this model is predominantly seen in preparing a HR department for high performance in delivering HR products and services as well as expanding HR’s scope of tasks. For example the model is believed to lead to better service for employees utilizing HR as a centralized organization with standardized processes means it is easier to monitor and manage service levels than doing this at multiple sites separately (Middendorf 2005). And according to Ulrich (1997) the model is particularly suited to setting up the HR organization to be a value-creating partner-in-business. Thus, through proactively managing the whole human side of daily operations, a corporation improves its overall performance and competitive capabilities.

It can be summarized that this concept, because of its widespread use in business, has been very well legitimated. Because the implementation of the Threefold Model is seen as a necessary condition for enabling HR to perform well and to create value for the whole organization, it is likely that it will continue to enjoy increasing popularity in practice and we will see even more companies moving to this organizational form of providing HR products and services.

B Topic of Research and Research Questions

Despite this increasingly widespread real-world implementation, the Threefold Model has not yet undergone rigorous research. This is partly due to the fact that this is a relatively new form of organization (Cooke 2006, p. 212). Much of the available knowledge with respect to this research field is based on publications for practitioners with an anecdotal character which are not founded on empirical or theory-led methodology (e.g. Personnel Today from 15.04.2008).

In these publications, however, the model is shown repeatedly in a negative light. For example a non-representative study from 2008 by a U.S. American management consultancy is cited, where only 47 percent of 479 surveyed HR managers are satisfied with the results from introducing the Business Partner model in their organizations. A quarter of respondents actually considered the model to be ineffective (Personnel Today from 28.01.2008). In a study by another management consultancy, 59% of respondents responded that the satisfaction of internal customers in a shared-service organization is the central challenge (Dressler 2007: 30). Even on the scientific front Ulrich’s statements and the organizational structures associated with his concept are often criticized and viewed as problematic for a HR departments’ performance in delivering HR products and services (eg. Procter/Currie 1999; Scherm/Small 2008; Eberl/Gieselmann 2008).

Among these, however, the only empirical study I am aware of is an essay by Fang-Lee Cooke (2006) which is concerned with the implementation of the Threefold Model in a multinational corporation in the United Kingdom. She has also come to the conclusion that implementation of the model can be thoroughly beset with difficulties in regards to organizing work and found a significant gap between the claims of this model espousing high performance and her empirical findings. Cooke (2006, p. XX) concludes that "[t]he idea of separating the HR function into strategic, operational, and administrative components may prove to be too simplistic" and for further research she recommends a focus on the interaction processes of the social actors in such an organization.

This seems especially important as interactions between functions are an essential part of HR product and service delivery but have never been explicitly addressed in the work of Dave Ulrich (Procter/Currie 1999). Exactly because implementation of the model in an organization involves significant changes to the structure of the HR department and has a direct impact on coordination of work, employee collaboration, and service provision, greater knowledge about it would be desirable. 

We can conclude that we don’t know whether the adoption of the Threefold Model will actually lead to the utility it claims and in both, academia and practice, performance challenges are being identified that require a closer look. But because the existing work has mostly not been done on basis of a theoretical framework or empirically grounded studies, hardly any insights exist how the model actually manifests itself in organizations, how work is coordinated or what effects it has on performance of a HR department. To my knowledge high performance work practices in HR departments have not been explored and we do not have a clear understanding on the mechanisms of action that unfold through organizing a HR department in this form.

It seems important to learn more about how employees work together and to understand how work is coordinated in the Threefold Model. This also enables us to broaden our comprehension of the effects that this model has on performance in HR departments.

I address this gap in current research by adopting a perspective from the Theory of Relational Coordination to develop a conceptual model of high performance HR departments. The central concern of my research is to contribute a perspective of interactions, social relations and coordination. To my knowledge this has previously not been covered by academic research and could be helpful to expand our understanding of the model and to stimulate further research. Moreover, by applying the theoretical framework, I try to explain how high performance can be achieved in HR departments employing the Threefold Model.

The following research questions are leading my research with the overall objective to create a scientifically sound and practical analysis:

What is a High Performance HR Department? What are the responsibilities of a modern HR department that is asked to create value for the overall organization?

How does the Threefold Model manifest itself in HR departments? What work practices are currently employed in HR departments of large companies that employ the model? What impact do these have on coordination in and performance of the HR department?

What implications can be drawn from the results of this study for the design of work practices and in regards to the organizational structure of high performance HR departments?

C Theory

This study uses the Theory of Relational Coordination (Gittell, 2000, 2001, 2002a, 2002b) that specifically theorizes that the effects of high performance work systems on performance are mediated through the way members of an organization are able to coordinate their work relationally. The theory focuses on the interactions among participants, carried out through communication and a web of relationships between these participants. Thus, communication and relationships are the two dimensions of this kind of coordination, and each of these breaks down into different sub-dimensions. These dimensions constitute relational coordination and it is postulated that communication carried out for the purpose of task integration is influenced by the nature of the working relationships that exist between participants in a work process. These working relationships in turn are influenced by the nature of their communication. Coordination that occurs through high quality communication supported by well established relationships enables organizations to better achieve their desired outcomes. Empirical evidence from different service industries support that claim and it has been shown that companies that have high Relational Coordination have also a better overall performance in such areas as service levels, customer satisfaction, perceived quality, etc..

For this study I develop a conceptual framework of performance for HR departments that uses the seven dimensions of Relational Coordination. This framework will guide my empirical investigations by especially focusing on work practices (Gittell XXXX) as well as job design (Gittell XXXX) (fig. 1)

The Relational Coordination framework seems to be especially appropriate for this field of research as in the Threefold Model multiple specialized groups are involved in coordinating highly interdependent tasks. In larger enterprises, HR departments can span across multiple sites, in a globalized setting even across national and cultural boundaries posing challenges for employees working together. Additionally, organizational boundaries exist between the multiple and distinct subgroups that are highly fragmented due to functional specialization. The multitude of professions found in HR departments is also posing challenges for coordination: On the one hand archetypical post-bureaucratic knowledge work is highly represented. On the other hand HR departments entail also many relatively low-skill tasks such as getting and passing on information, filing, approving claims that need to be well organized. It can be assumed that the coordination of all of these team members seems to be essential for effectively processing work and thus for high performance of the HR organization. However, the involvement of multiple specialized groups alone is a common scenario and does not call for much special attention. In traditional production systems this is addressed by standardizing work processes and interfaces, allowing predefined sequential hand-offs of cases from one function to the other (cite!).

The distinctiveness in HR departments lies in the challenge that all of these parties while processing work are transferring complex information that has a high bandwidth. Due to this complexity and great variance of information, much of it is not readily codified and therefore often transmitted between HR staff in informal rather than formal ways, including face-to-face, telephone or e-mail interactions.

Most HR tasks require vast and specialized knowledge such as labor law, as well as HR practices and methods. HR experts also need to ensure that all information is always up-to-date as much of HR knowledge, especially laws, are prone to change. Additionally, employees in the HR field deal with a multitude of possible demands by their internal customers as HR usually covers various fields of services. HR is furthermore complex given the proliferation of different employee groups, collaborative agreements, benefits, work contracts, etc., each with its own restrictions and requirements.

Depending on each individual case, HR staff has to coordinate with each other relationally to effectively process work. As a result many of the work processes typically found in HR departments are characterized by reciprocal and iterative interactions between team members of different functions and professions as further knowledge and feedback is required along the work process. In this highly interdependent setting, tight coupling among the people that work together deems necessary for effective work coordination. By looking at work practices and job design in HR departments having adopted the Threefold Model through the lenses of Relational Coordination I expect to broaden our understanding how the separation as well as centralization of the HR function can provide an effective path to achieve high performance and what factors inhibit effective work coordination.

D Methodology

Given the relative lack of academic research and empirically grounded studies on this topic, an exploratory approach seems particularly appropriate. This raises the need for qualitative data and a sufficient level of flexibility in the investigation process to provide rich descriptions and explanations of processes as well as interactions of social actors between different levels of the organization. A static design could not provide this (Miles and Huberman 1994).

I engage in the multiple-case studies design for my research (Eisenhardt 1989; Yin 2003). The aim of this kind of analysis is to use the data from each individual case to get to an overarching understanding of the subject. This seems to be especially appropriate due to the nature of the research question where the boundaries between phenomenon and context are not clearly evident and the focus on a contemporary as opposed to a historical phenomenon is present (Yin 2003). 

This study is based on the six generally accepted quality criteria for data collection in qualitative research by Mayring (2002: 144 ff). Given how little is known in this field of research and in order to sharpen the analysis as well as to enhance empirical reliability I especially emphasize triangulation (Miles and Hubermann 1994; Yin 2003; Mayring 2002). Thus I’m using different collection methods, different sources of information, different types of data and the consideration of different interpretations, theoretical frameworks and methods. In addition to interviews as the primary data source, I also engage in close observation of work where possible (Barley/Kunda 2001). I furthermore validate results with HR experts and attend HR conferences to discuss results with practitioners. The goal is to gain a comprehensive and detailed understanding of work practices and coordination in HR departments that employ the Threefold Model.

Three companies of different industries were chosen for this study in a process of theoretical sampling based on maximizing differences using publicly available information (Glaser/Strass 1976; Eisenhardt 1989). I limit my research to large companies as these are more likely to implement the Threefold Model. All of the companies selected are multinational corporations of different industries, all having their headquarters in different countries, all with more than 130,000 employees worldwide and annual gross revenue of more than U.S. $ 9 billion. Due to this variance I expect that organization of work in their respective HR departments will vary across these firms. However, each company engages in sophisticated HR operations following the ideas of the Threefold Model. All corporations base their HR delivery model on in-house production and employ various means for HR product and service delivery such as Business Partners, Shared Service Centers, HR self-service portals, usage of sophisticated ERP software, and knowledge management tools. Being multinational corporations, all are faced with the conflict of administering HR in a globalized and as such, decentralized setting, despite the Threefold Model’s centralized approach.

Sites to conduct interviews and to make observations were selected from each of the three companies. Where possible I also based this selection process on geographic diversity, expecting more variation in work organization across sites that are located in different countries. Semi-structured interviews are conducted with employees believed to be central to coordinating work in different areas at the selected sites, trying to illustrate the complexity of interpersonal interactions on various levels in these organizations. Apart from this, I had no particular reasons to choose these firms, particular sites or people as my research population other than desiring various firms and considerations of accessibility and convenience.

In order to gain deep insight into HR operations for the purpose of research that is publically available, I am not able disclose any information that would allow the mapping of any findings to a particular firm, site or employee interviewed. I also have to observe various rules and regulations of Federal Co-Determination Acts that apply for different sites and companies, restricting the methods of recording and documenting interviews and observations.

E Proceedings of the Thesis

The study starts by summarizing current academic research in regards to the threefold model and challenges of current work in the HR field are presented.

function in general. This subsumes the current research and treatment leads to further problems down to. I address these challenges by focusing on coordinating mechanisms and the work practices that surround those in HR departments.

For that reason, I develop in the second chapter of a conceptual framework for a HR department Relational Coordination. The theory is introduced here and it is explained how interpersonal relations within a social network of an organization has an impact on coordination of work and high performance.

Part Three and Four include a descriptive overview of the results of the case studies. Part Three focuses on relational work practices and job design in HR departments that can be conceptualized as forming a relational work system that strengthen relational coordination and thereby improve performance. Part Four presents how the different organizations differ in organizing the HR functions within the threefold model and how work is coordinated among them. This will help ensure a better understanding of how the threefold model in practice is manifested.

In the next chapter the empirical results of this study are aggregated and analyzed in light of the theoretical framework developed before. Service delivery of HR products and services and its coordination

In the third part of this work is to sollenGoal, based on the results of the analysis letztlichUntersuchung knowledge that the management of HR in a business partner to guide the organization and too win, possibilities and limitations of the models, demonstrating how threefold. This will create a deeper understanding for the model to be developed to make it usable in practice, the better to machen.Focus is put on how role identities, job boundaries and the degree of functional specialization affect the cross-functional coordination of work and successes but which So what dysfunctionalities can result from this. Shortcomings of the threefold model are identified

from the relational perspective are analyzed as well.

5th The Relational Model HR

Service delivery of HR products and services is analyzed in the realm of its coordination aspects.

In a last step the findings of this study are used to develop a Relational Model of a High Performance HR departments for large companies. This part summarizes the ideas in an integrated and innovative approach to organizing and coordinating HR work. This chapter especially aims to give practical advice to practitioners who want to achieve high performance in their HR organization. The shortcomings within the threefold model are addressed here and ideas and deliverables of this study are to overcome the shortcomings Summerized in an integrated and innovative approach to coordinating and organizing work in a HR department.

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