In our peoplist age, the importance of innovative human resource management is very much focused upon. The effective recruitment and retention of talent can make or break an organization. However HRM must constantly be alive to the factors and influences shaping its future. One such influence playing a prominent role is that of outsourcing. The business of being in HR is becoming ever complex, with many factors influencing the increase in outsourcing. Technological advances and the effects of globalization means that even small business can enter into an international arena. The demand for talent has ignited technological innovation such as teleconferencing and telecommunication to encourage the creation of a “virtual workforce”.
The key point embracing HR as a profession and outsourcing as a business choice is that human resource professionals must be involved in the running of their organization at a strategic level. The World Wide Web (WWW) has made possible the effective outsourcing of administrative HR. Web based HR can be scaled to match a company’s changing demands. HR must be adaptable, progressive and far-sighted. There will still be a role for HR to monitor outsourced benefits and to look at the HR processes that make the company an attractive employer. Human Resource Outsourcing (HRO) is one of the fastest developing sectors which follows, the software outsourcing.
Companies today seem to have realized the cumbersome process involving in managing human resources as an in-house project and relative cost associated. This is the reason why most companies have taken to comprehensive human outsourcing resource outsourcing. A comprehensive human resource involves a company to outsource not only the basic human resource functions but also the major functions like payroll outsourcing, benefit outsourcing, personnel administration, hiring and recruitment, education and training. A comprehensive human resource outsourcing helps the company to cut human resource cost, improves employee satisfaction levels, lower overhead on HR and Recruitment, shorten employee turnover and increase productivity. Many companies seem to struggle with determining and articulating a differentiated vision of having a strategic approach to HR outsourcing.
Service providers are attempting to sign deals and expand their offerings in response to the growing customer needs for integrated solutions. HR services and business process outsourcing in general attempt in achieving strategic value, with the same rigour with which companies apply analysis to their supply chain. Though this seems fundamental, but its application is still far from widespread.
Outsourcing began as a cost-saving exercise and is now becoming a more extensive move to strategic outsourcing that may fundamentally change the shape and nature of individual companies and affect entire industry value chain. This is becoming known as “transformational” outsourcing – Will outsourcing HR functions allow the organization to focus on its core competencies and provide administrative relief from employer-related responsibilities?. Will HR outsourcing help the organization to concentrate on developing strategies that provide a competitive advantage?. Will HR outsourcing have a positive impact on the business in terms of productivity and profitability?
The present study on the Business Process Outsourcing (BPO) as an effective HRM strategy has been carried out in the Indian context, with an overall reference to the global outsourcing scenario. In order to examine the impact of BPO, the following main aspects are examined.
Is there any relationship between the HR outsourcing and the HR cost reduction of the IT companies?. Is there any relationship between the HR outsourcing and profitability of the IT companies?. Does the HR outsourcing reduce the companies overall administration activities?. Is there any relationship between HR outsourcing and the productivity of the IT companies?
Answering these questions would be significant and the present study is an attempt in this direction. The study has also attempted to discuss the factors responsible for transforming a transaction-based relationship to value-added strategic partnerships. And finally, to sum it up, the present study has analyzed Business Process Outsourcing from the perspective of both the outsourcing organization as well as the outsourcing services provider.
METHODOLOGY OF THE STUDY:
The procedure adopted in the present study is descriptive. Both Primary and Secondary data were collected for the study. The primary data were obtained through survey issuing a questionnaire and interview schedule.A detailed questionnaire was carefully prepared and serially numbered. The questions were arranged in proper order, in accordance with the relevance. The secondary data were collected from books, magazine, news papers, internet, national and international journal, reports prepared by research scholars. A sample of 150 respondents in total were used. A sample of 150 respondents in total has been (one hundred from the clients and fifty from the vendors of the outsourcing companies) randomly selected. Most of the questions were designed on five point scale: a) Excellent – 5 b) Good – 4 c) Fair – 3 d) Satisfactory – 2 e) Poor – 1
The variable of the study were as follows : The reasons for outsourcing were studies on the basis of – cost, internal expertise, service to customer, management time on concentration on core business and market expertise. The problems in outsourcing were measured on the basis of – over promising supplier, hidden costs, lack of communication, standard benchmark, lack of understanding mutual expectations.
Data were analysed with Leven’s Test for equality which was used to compare significant differences between the factors.
