After customer care services and medical transcription, outsourcing of human resource services or HR BPO is emerging as next big opportunity for Indian BPOs with the global market in this segment estimated at $40-60 billion per annum, experts said.

"HR BPO comes to about 33 per cent of the outsourcing pie. India has immense potential as more than 80 per cent of Fortune 1000 companies will discuss offshore BPO as a way to cut costs and increase productivity," said V Chandrasekaran, co-founder of Secova eServices, the first Indian HR BPO.

Sensing the potential, global BPO players including Fidelity, Exult and Hewitt have begun setting up operations in India.

However, most HR BPO players have not leveraged the offshore advantage as yet, he told PTI.

The rest of the article can be read at http://infotech.indiatimes.com/articleshow/932152.cms

Regards
Jigar

Hi Jigar & colleagues,

Thanks for the article. It does give one a potential available to diverse into self - employment. HR consultency was in vogue for some time now - almost 20 yrs. now that I know. Areas were domestic enquiries, Legal advice, employment of contract labour, Pay-roll, welfare activities - health services, canteen, entertainment (clubs, sports, etc.), recruitment, security, house-keeping, safety equipments, training, etc.

Counsellilng, potential appraisals, psychometric tests, surveys, system-design, HR audits could be the areas which will see light of BPO. Undertaking BPO business will be a good beginning for someone who is enterprising, entrepreneurial and in his mid-carrier with sufficient hands-on exposure. It does call for continuous upgradation - continuous reading, being a member of professional bodies, member of a web portal like one we are in, etc.

However, I strongly feel, the core HR, selecting an agency for out-sourcing, in-house co-ordination and decision making would be in-house and will be difficult to outsource.

For someone who is looking for a job soon after his/her professional course accepting an opening in an HR-BPO industry, being a part of a small group in HR-BPO, even a firm like recruiting (few have raised the question whether working in such a firm was a right choice of a career ) there should not be any hesitation.

Once again thanks for the article. The subject no doubt was relevant.

Nicole

I think people get confused about outsourcing HR. Often they think it means there's no one left who cares about the employees. But that's not the case. It simply leaves HR people inside the business free to work on strategy and vision and focus on things that truly add value.

Regards,

kaushik

There have lately been many articles on the issue of “HR Outsourcing” on several websites. Time and again, the issue on outsourcing has made its impact on everyone’s mind. Let us say, these days, Training & Development is being outsourced to freelance trainers or training institutes, or in that case, manpower requirements or needs have already been outsourced to placement consultants & staffing companies who have established themselves almost around every nook of the corner. Even some companies are going to the extent of outsourcing their entire Employee payroll to an outsourcing service provider or say, a third party.

What makes me often wonder is the fact that, what shall be the extent of outsourcing HR functions. No doubt, Technology & Modernisation have been majorly responsible for a turnaround in the working conditions of employees and it has helped to bolster the economy as a whole. But, what shall be the future of HR, if the outsourcing trend keeps on rising and more and more companies feel the need to have few employees and in turn outsource the major functions of Human Resources. There is no doubt, that companies and the management are seeking to hire specialized services from outsiders but then don’t you think that somewhere, somehow, an HR professional is underutilized and is being delegated only certain functions down the line without their talent potential being cracked completely.Take this example : What’s the use of a management graduate who has also done a diploma from a training institute but his/her role does not involve training & development (direct) as such since these are outsourced to specialized training institutes.

So the question lies….

- What shall be the future of Human Resources considering the fact that certain functions are being outsourced ?

- Do you think the value & talent of an HR professional is being underutilized by outsourcing these functions ?

- What according to you shall be the future of an HR professional (considering their roles & duties) ?

Views, ideas, opinions, free flow of thoughts and discussions from members shall be appreciated....

srini

Hello,

Since the discussion is on "HR Outsourcing", each day is seen with emerging trends or business initiatives from employers largely in the IT sector who are keen enough to maximise the returns by strengthening their employee teams and taking fair advantage of the current scenario wherein the initial one shall describe the outsourcing factor. To my extensive research after recieving enormous responses from members, this is the latest information that I have come thru which definetely shall be of extensive knowledge to one & all.

PeopleSoft and Zensar to offer outsourced HR services - PeopleSoft is king in the HR applications arena, while Zensar is known for its enterprise application implementation strengths. The two have teamed up to target the domestic HR market, says Venkatesh Ganesh. According to Thiru Vengadam, organisations that are stuck with a low-end solution can now drive global best practices into their HR processes without having to buy licences. The Indian outsourcing juggernaut rolls on. The latest concept emerging from the outsourcing scene is related to human resources (HR) outsourcing. Hitherto organisations have been reluctant to outsource HR. The Zensar-PeopleSoft alliance aims to change all that by helping Indian organisations outsource some or all of their HR functions or business processes to a third-party alliance. The concept here is one of ‘HR shared services,’ which happens to be a $78 billion market globally. According to a McKinsey report, the global HR outsourcing market is valued at $78 billion. India’s huge workforce makes the country one of the largest potential markets in the world for HR outsourcing.

Regards,

Hrushikesh

Dear friends,

Following are the views on the raised question :

1. The question is like will robots replace human-beings? The answer is always 'since it is man who creates robots, he will always remain superior. Likewise as long as there are humanbeings in an organization there will be HR person in an organization.

2. What is being outsourced are mechanical processes of HR. Time-keeping, Security, House-keeping, Canteen, Welfare activities, Transportation, General Administration, Safety, Medical facilities, Initial screening of candidates for recruitment, imparting of training, testing (i.e. psychometric tests, etc.).

3. Another area which is being outsourced are expertises. Legal, technical (psychological counselling, domestic enquiries, Surveys, interviews, etc.) where internal HR person lacks in upgrading himself.

Outsourcing was always there in other functions, it came to HR late:

Outsourcing was always there. Cost cutting lead to outsourcing.

1. Production processes were outsourced long back.
2. Marketing was outsourced - dealer net work, agents, etc. were common thing long bnack.
3. Non-HR legal was also outsourced long back.
4. Specialized maintenance was also outsourced.

Following areas, I feel, can not be outsourced:

1. Co-ordination on behalf of Organization still remains with HR.

2. Compilation of available data, getting it discussed and facilitating decision making within the organization still remains to be an HR activity.

3. Designing basic HR frame-work still remains to be an HR activity.

4. Emergency handling of HR on site still remains to be in-house job for difficulty of logistics.

HR has to gear-up to sustain its existance:

1. If HR person is multi-disciplinary (which is a recent trend now, i.e. Engineer-HR, etc.) his value addition will be much more richer compared to only HR specialist.

2. Lack of our knowledge or ability to understand and appreciate data from other functions, at least in more than general sense, is of disadvantage to us. We need to have more than working knowledge of other functions.

3. HR is effective when there is variety of knowledge. HR's strength is his ability of having handled a situation under different circumstances. It is like doctor having performed many operations. Many a times HR personnel lacks that exposure and hence the confidence in him in the minds of the Management.

HR needs to assert itself or respect its fundamentals:

Sometimes, in fact many a times, HR is its own enemy. In the process of managing things, we ourselves try to outsmart our clan. "See, how I managed it...my colleague my predecessor could not manage it...?". It is like current Government putting down all that is done by the previous government. This is because we deal with a dynamics which can not be same in any given two situations.

We should not compromise on our fundamentals as a professional body.

However, I repeat, HR can not be outsourced to the extent that it is eliminated from Organizational scene.

Regards,

Jagadish

Dear colleagues,

The benefits of outsourcing can become easily overshadowed by its downside - loss of knowledge. This means that organizations can become anorexic, instead of lean and mean.

Outsourcing has emerged as a worldwide business megatrend. According to the Outsourcing Institute, the recent global outsourcing market totaled roughly $150 billion, and is expected to reach $318 billion by the year 2004.

Sure, outsourcing is appealing - and seductive. It allows companies to shift directions quickly, to make faster decisions, and to adopt a just-in-time-payroll. Sounds too good to be true? Perhaps. Outsourcing can do all that the proponents claim - at a price. Outsourcing robs organizations of "knowledge.

For example, look at HR, which is a major target of outsourcing - accounting for 16 percent of all outsourcing expenditures (Outsourcing Institute, 2004).

Outsourcing HR functions may work fine for the daily filling out of forms. But without HR professionals in-house, who is left to pay attention to human concerns? Who will see rumblings among employees that could turn into costly turnover in coming months? Turnover data gives us information after the horse has left the bar. HR, when it is working at its best, is able to pick up early warning signals. HR can tell which benefits package is likely to be met with acceptance. Internal HR can provide savvy in organizational development projects such as restructuring and team development. Outsiders have difficulty understanding the subtleties of culture until they bump up against it.

Because of the downside, here`s some advice for HR professionals - or for any other department that runs the risk of outsourcing:

(1) Distinguish where your presence could be of strategic importance to the company and where work could easily be outsourced. Fight to hang onto those strategic roles - and concede on those services that could be done easier and cheaper by vendors.

(2) Once you`ve determined what`s of strategic importance, assess your department. Does the COO, CEO, CFO, and CIO agree that your work has strategic importance?
If not, you must begin to shift what you do in order to beef up skill and visibility in strategic importance.

(3) When assisting the organization in outsourcing, identify potential risks. Don`t let leaders be seduced by numbers. Show human impact if outsourcing equals downsizing. The impact on productivity and morale could be devastating across the organization. Demand that leaders look at possible unintended consequences of outsourcing.

Regards,

Tracy