The
global market for HR business process outsourcing (BPO) is set to grow at an
annual rate of 21 per cent, reaching $7bn (£3.89bn) by 2008, according to
business analysts NelsonHall.
NelsonHall’s Targeting HR
Outsourcing study predicts a growth rate of 11 per cent for the total global HR
outsourcing market – signifying that the multi-process
component of the market is the most robust in terms of growth.
John
Willmott, founder of NelsonHall, commented:
"Until now, most global HR outsourcing deals have been single-process
engagements, such as localised payroll services; pensions and benefit
administration; and recruitment.
"Now
we are seeing the emergence of the multi-process market. Vendors are partnering
with or acquiring other firms to broaden their HR service delivery capabilities
to include: organisational and people development; employee data management;
workforce planning and deployment; and human capital services."
The
NelsonHall study confirms
that cost reduction is a key driver for outsourcing HR processes. The
transformation and enhancement of HR processes is also a key driver for
organisations adopting multi-process HR outsourcing.
"Organisations
outsourcing multiple HR processes expect a reduction in HR operating costs of
between 20 and 40 per cent, but they are also looking for improvements in their
HR service quality, the introduction of e-HR service models, and access to
improved management information and performance metrics," said Willmott.
Sign up to our weekly round-up of HR news and guidance
Receive the Personnel Today Direct e-newsletter every Wednesday
