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The design of an HR organizational model requires considering a number of potential factors - the available HR budget, business organizational structure, business and HR strategic plans, critical workforce segments, and the company's culture. Each element has a possible impact on the organization's design and assignment of roles and responsibilities to ensure that the company's business and talent needs are being met simultaneously. No matter the structure selected, an annual review should be conducted to understand new business initiatives and requirements, and the extent to which the current structure continues to support those evolving needs.
The first design consideration is based on the available budget for HR headcount, processes, technology, and business support. An HR budget often becomes part of the "chicken and egg" challenge. In many cases, the staff is determined before any given HR leader is installed; in that case, the decision becomes one of how to best allocate resources given the challenges faced. When developing a structure from the beginning, the course of action tends to be simpler, with required HR capabilities matched to a desired budget and current/anticipated business needs.