Quest to Make Public Sector HR Organizations Strategic Remains Elusive

Transformation Stymied by Lack of Resources, Inadequate Technology
and Aversion to Alternative Service Delivery Models
WASHINGTON, D.C.--(Business Wire)--
Public-sector HR executives stand poised and ready to deliver
greater workforce productivity, lower human capital-related costs and
the critical services needed by their constituencies. But efforts to
transform HR into higher-performing organizations continue to be
stymied by scarce resources, inadequate technology and an aversion to
alternative ways of delivering traditional HR services, according to a
recent survey by EquaTerra and Human Resources Executive magazine,
which polled 450 HR professionals, 30 percent of whom work in the
public sector.

"The study highlights the challenges public-sector HR faces in a
time of diminishing resources," says Neil Reichenberg, executive
director of the International Public Management Association for Human
Resources. "Progress is being made, but it's clear HR departments need
to develop innovative strategies and tools that enable them to become
leaders in total talent management within their organizations."

Equally troubling, public-sector HR continues to lag behind the
private sector when it comes to being perceived as strategic to the
organization. While 61 percent of respondents from commercial
companies felt executive management viewed HR as a strategic asset,
only half of the study's public sector respondents felt they were
perceived this way.

"When half of the respondents - HR practitioners themselves -
believe they aren't viewed by others as providing strategic value to
their organizations, we're in trouble," said Glenn Davidson, managing
director of EquaTerra's public-sector practice and co-author of the
white paper Making Public-Sector HR Strategic. "This self-assessment
signifies that, as a profession, we still have much work to do to
demonstrate HR is more than a cost center. Effective capital
management is the difference between a good and a great organization."

One of the biggest stumbling blocks to moving the public-sector HR
organization up the value chain may be its disinterest in alternative
service delivery models such as shared services for transaction
processing, the creation of consolidated centers of excellence for
delivery of core services and the use of outsourcing for either HR
information technology or HR business processes. Survey respondents
scored each of these alternative service delivery models in the
mid-to-lower end of a five-point scale.

Stan Lepeak, managing director of EquaTerra's research business
and co-author of the white paper, predicts, however, that
public-sector HR organizations will follow the commercial sector over
the next several years in adopting new methods of service delivery.
"The benefits include greater overall efficiency and effectiveness and
freeing staff to focus on the high-level, high-impact activities that
are strategic to the organization's success."

Other key findings from the EquaTerra HR white paper:

-- HR IT Operations Continue to Disappoint - The study shows
fairly low satisfaction levels with HR IT applications and
systems. On a 1-to-5 scale with 5 being most satisfied,
public-sector HR IT was rated 2.64.

-- Total Talent Management Top Priority - More than 70 percent of
study respondents indicated becoming a leader in total talent
management is key to making HR more strategic.

-- Lack of Resources Barrier to HR Transformation - Half of
public sector respondents cited lack of resources as the
number one barrier to overall HR transformation, with lack of
funds for HR IT transformation a close second.

-- Public Sector Disinterested in Outsourcing Models - While it's
generally understood shared services, HR ITO and HR mission
and business services outsourcing could free staff to become
more strategic, public-sector organizations are disinterested
in such models, particularly outsourcing.

-- RPO Not Deemed Critical Talent Management Tool - Despite
industry buzz, the adoption rate of Recruitment Process
Outsourcing (RPO) among public sector organizations is
glacial. Less than six percent of public sector respondents
indicated their organization had implemented a RPO strategy,
citing everything from costs to simply feeling a third-party
could not understand their recruiting needs.

EquaTerra will present a Webcast on How to Make Public Sector HR
More Strategic on Wednesday, July 23, at Noon EDT. Public-sector
panelists Naomi Wyatt, secretary of administration for the
Commonwealth of Pennsylvania and Donald Packham, executive assistant
director and chief human resources officer for the Federal Bureau of
Investigation will join EquaTerra's team to discuss and analyze the
findings of the recent survey and share their own insights and
experiences. To register, please contact:
allison.norman@equaterra.com. A free copy of the white paper can be
downloaded immediately following the Webcast.

About EquaTerra

EquaTerra sourcing advisors help clients achieve sustainable value
in their IT and business processes. Our advisors average more than 20
years of industry experience and have supported
over 2000 transformation and outsourcing projects across more than 60
countries. Supporting clients throughout the Americas, Europe, Middle
East, Africa and Asia Pacific, we have deep functional knowledge in
Finance and Accounting, HR, IT, Procurement and other critical
business processes. EquaTerra helps clients achieve significant cost
savings and process improvement with internal transformation, shared
services and outsourcing solutions. For more information, please
contact Lee Ann Moore at +1 713.669.9292; leeann.moore@equaterra.com;
www.equaterra.com.

EquaTerra
Catarina Wylie, +1 214-349-8507
Director of Public Relations
catarina.wylie@equaterra.com

Copyright Business Wire 2008