For most of Buck's Unpainted Furniture Inc.'s 41 years of operation, the manager of each location has done the hiring for his or her store. But things at the 40-employee retailer in Minnesota's Twin Cities area have recently changed. Now all hiring is done by a new human resources department operating out of Buck's Bloomington headquarters.
"We had some industry people come in and look at us, and this was one of the first things they recommended," says vice president Ray Buck, 50, one of four brothers who together run the company their parents founded.
The advice isn't surprising. Centralizing company functions-in a manner now known as the "shared services" model-is one of the hottest trends in business today. Those who practice it say they can cut costs while improving the quality of the services shared. The latter of those effects is the impetus behind Buck's move to share human resources among its three stores.
"In the past, with each store handling its own hiring, if you were looking for a new sales-person and some-body came in, you began talking to them and maybe it worked out," Buck says. Most of the time, that was fine. But as employment regulations and issues grew more and more complex, the brothers realized that a shared-services setup would make it far more likely things would continue to work out over the long haul. "There are so many laws now, there are a lot of things that store managers simply aren't going to know," says Buck. "Just the way you handle somebody's application could become a huge thing down the road if somebody says they never got a fair shot at a job. To ward off things like that, human resources was something we felt we needed to have a handle on."
Mark Henricks is an Austin, Texas, writer who specializes in business topics and has written for Entrepreneur for 11 years.