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HRO

HRO. BY AJITHAA HASAN. Evolving Role of HR. Strategic management decisions Value-added services Achieve a competitive edge Primary functions are based on frameworks: competency-based structural process-oriented profit centers. HRO?.

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HRO

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  1. HRO BY AJITHAA HASAN

  2. Evolving Role of HR • Strategic management decisions • Value-added services • Achieve a competitive edge • Primary functions are based on frameworks: competency-based structural process-oriented profit centers

  3. HRO? • Any activity in which a company lacks internal expertise and confidentiality and requires an unbiased opinion on human resources, can be outsourced. • HR outsourcing services: PEOs, BPOs, ASPs, or e-services.

  4. Professional employer organization (PEO) • Assumes full responsibility of company's HR administration • Takes full legal responsibility of your employees

  5. Business process outsourcing (BPO) • Referring to outsourcing in all fields, not just HR • Putting in new technology or applying existing technology in a new way to improve a process • Self-access and HR data warehousing

  6. Application service providers (ASPs) • host software on the Web and rent it to users • packaged applications (People Soft) or customized HR software

  7. E-services • HR services that are Web-based • Includes BPOs & ASPs HR outsouring categories: Transaction & Administration outsourcing and HR consultancy

  8. Why are organizations outsourcing?

  9. Preference for HRO • Outsourcing of BOP instead of BPO • Saves key people’s time • Concentration on core competency • Enhancing profitability • Mid-sized cos - >87% of funds towards routine processing transactions • Best systems, most experienced minds

  10. Some Statistics • U.S. - >2/3rds of the corporations have outsourced 5 or more HR functions • 98% are ready to further outsource • HR personnel shrunk by 16% • Survey on “Outsourcing in the Asia-Pacific” confirms lack of momentum(5%) • Outsourcing market in APAC region - $1.14 billion in 1999 to $2.56 billion in 2004

  11. Advantages of HRO • Reducing or eliminating fines and penalties by keeping pace with changing government regulations. • Achieving measurable, bottom-line results by increasing efficiency and leveraging outsourcee’s economies of scale. • Lowering infrastructure and facility costs by having the HR function administered off-site. • Sharpening your business focus by eliminating interruptions caused by employer obligations, risks and liability. • Improving employee retention and morale by providing timely answers to payroll and benefits questions.

  12. Advantages (contd..) • Expanding scope and level of service. Your HR department can’t be subject experts in all areas – our staff of more than 65 HR professionals can. • Implementing organizational initiatives that link to your overall business plan: HR becomes strategic, not tactical. • Overall, companies tend to outsource to alleviate administrative burdens and focus on strategic areas

  13. Factors hampering HRO • Cost factor & Confidentiality • The fear of losing jobs • Loss of sensitive information to public/competition • Ethics and quality of outsourcing vendors • Possibility of security breaches • Cost-benefit equation not clear • Lack of psychological acceptance

  14. Have high volumes Are repetitive and routine Reflect consistent customer needs Have opportunities to leverage Are service and efficiency driven Are easily measurable in terms of performance Support key business processes Get influenced by external forces Require high content expertise Are ad-hoc, periodic future oriented projects Are difficult to measure Have high impact on organization as a result of non performance, failure or mistake Retain activities that Outsource activities that

  15. Relocation Recruiting/Staffing Competence Development Salary Administration Consulting and Training HR Information Systems Disciplinary Issues HR Surveys HR Research Staff Loans and Perks Manpower and Career Planning Areas where HRO will work

  16. THANK YOU

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