Having discussed HR outsourcing with leading BPO providers, advisors and industry analysts, it is clear that the rapid growth of HR outsourcing has not materialised as was once expected.
In recent months we have seen HP sell their Excellerate HRO capability, which provides employee benefits information globally and offers relocation for circa $125 million (reportedly this was a loss making capability), Convergys sell their HRO capability to Northgate Arinso after racking up losses of $600 million, and advisory firms seeing much less activity in HR Outsourcing.Whilst the HRO market is certainly consolidating, that does not necessarily mean that the market is dead – there is certainly opportunities in the market for organisations that can combine the IT, Outsourcing and Consulting capability. The latter being increasingly important as organisations desire the workforce outcomes from HR transformation i.e. improved employee morale and reduced absence and sickness rates.
Is HR Outsourcing dead – No, but it is more difficult for providers to deliver profitable solutions with suitable capability in this market, than in Finance and Supply Chain.
Tags: Convergys, HP, HR, Northgate, Outsourcing, Transition
Friday 8 October 2010
Final Thought: The death of HR outsourcing? « Proservartner – Partners in Excellence
