Shared services and outsourcing are effective tools for HR transformation and improvement in public-sector agencies, yet these services have traditionally been overlooked or underutilized, says a recent research by ADP National Account Services, part of ADP Employer Services Division of Automatic Data Processing (ADP), a outsourced payroll, benefits and human resources (HR) services provider.

According to the study, conducted by EquaTerra, outsourcing is beginning to gain ground in the public sector. Fifty-five percent of survey respondents — senior-level HR officials in federal, state and local U.S. public sector agencies — reported using full or partial shared-services solutions and 17% now outsource some HR-related functions.

In total, 94% of responding organizations that have outsourced HR functions were satisfied with the results. In addition, 53% said that the transition process for moving to outsourcing was relatively easy for the organization. Similarly, 53% of organizations indicated that they are likely to outsource additional functions in the future. Workers compensation is currently the most common HR function to be outsourced, followed by retirement plan management and benefits programs.