1/11/2008
Ever wonder about the net effect of outsourcing human resource services? Get the facts before you make a move.

Human resource outsourcing has become increasingly important as HR professionals seek ways to reduce time and energy spent on transactions and administration so they can concentrate on more strategic activities that contribute to their organizations’ goals.

Many HR departments are holding on to talent management, recruiting and succession planning functions while handing off to providers payroll, benefits administration and other routine tasks. To help you better understand the dynamics in this changing HR outsourcing environment, this special report looks at the state of HR outsourcing from a quantitative and qualitative perspective.

The opening pages provide data on HR professionals’ experiences with and expectations for outsourcing, as well as data on the growing market for end-to-end HR business process outsourcing. In the article that follows, contributing editor Bill Roberts tries to answer the question: Is the down economy a buyers’ or sellers’ market for HR outsourcing services?

Sizing Up the HR Outsourcing Market

To understand how HR professionals view outsourcing, the Society for Human Resource Management (SHRM) sent an e-mail survey to randomly chosen members during the week of Aug. 18, 2008. Human resource professionals from 891 organizations responded to the SHRM Weekly Survey, and their responses were compared with those from a similar poll conducted by SHRM in 2004.

View Charts and Graphs:

• Effect of Outsourcing on Costs
• Satisfaction With Outsourcing Services
• Satisfaction with Outsourcing Vendor Relationship Has Your
• HR Department Brought An Outsourced Activity Back In-House?
• Sourcing of HR Responsibilities

The Business Process Outsourcing Market

Everest Research Institute, the research arm of Dallas-based outsourcing consultancy Everest Global Inc. that tracks the human resource business process outsourcing (BPO) market, defines a BPO deal as one that covers three or more HR processes for 3,000 or more employees. The average deal covers 10,000 employees and almost always includes payroll and benefits administration. These recent findings by the institute are based on more than 220 deals signed as of the end of 2007.

View Charts and Graphs:

• Number of New Deals
• Annualized Total Revenues from Deals
• Processes Typically Included in Deals
• The Top Providers
• Recent Large Deals

The Future of HR Outsourcing

The Society for Human Resource Management (SHRM) sent an e-mail survey to randomly chosen members during the week of Aug. 18, 2008,
asking what their companies’ plans are for outsourcing HR functions. HR professionals from 891 organizations responded to the SHRM Weekly Survey.

View Charts and Graphs:

• HR Outsourcing Expected To Increase in Next Five Years
• Anticipated Future Use of Outsourcing

The author, technology contributing editor for HR Magazine, is a freelance writer based in Prunedale, Calif.