Contributors

Predictions and an Introduction


By Elliot Clark
 
 
My first prediction is that the Mayan calendar was wrong. The world will not end on December 21, 2012. The Mayan civilization, which perished due to a cacao-bean based economy, did not realize that retailers would never let the world end two days before the second heaviest retail shopping day of the year.
 

The economy will be anemic, but the political debate in the United States and the economic debate in European Union will be, to cite Thomas Friedman, “hot, flat and crowded.” Hiring volumes by major companies won’t change much. We are experiencing a jobless recovery because small business—which has lifted the macro-economy out of recession in the past as disgorged executives started new entrepreneurial ventures—now suffers a credit crunch (since 2008) that has made access to seed money non-existent. So even this mechanism is broken.
 

Oddly, though, the adoption of RPO will continue at a pace similar to this year. RPO adoption in the U.S. will be at about 30 percent, a bit slower in the E.U., and there will be considerably higher interest in APAC. A lot of project RPO work will continue, and while there will be a lower percentage growth in the multi-year RPO market, it will still have very strong growth with a lot of companies trying RPO. MSP programs will continue to see strong growth, at roughly 25-plus percent, as companies recognize the strategic significance to their overall human capital strategy of an HR-driven program around contingent labor. This adoption is due to increased market education and awareness.
Multi-process HRO will continue to see strong renewals (almost all deals renew with the incumbent, and sometimes a new provider, but rarely go back insourced), but deal scope will be in the range of four-to-eight processes on average, versus the 15-plus processes of the prior decade, and new deals will get done on this scope basis.
 

Learning process outsourcing will suffer by the association with training spend, which has been damaged by budget cuts and the perception by many companies that shorter employee tenures make training a different investment calculus. We will see a flurry of redone health and wellness programs, based on the pending changes in the healthcare legislation and the new options for use of healthcare insurance exchanges.
 

Many firms are out talking to HR leadership about these options, and if you are not reviewing these alternatives you probably should. Specialty and technology-driven HR products related to better selection and productivity—such as screening, assessment, or rewards—will have good, but not great, years.
 

The question on the minds of most HR leaders managing HR as a global business is “how.” You can go many places to discuss “why.” In fact, you can get with your peers and discuss strategy at great length. We get calls following our Baker’s Dozen reports or the publications of our other research studies, and questions range from, “How do I insure that I get 1 percent or lower error rate from my hourly workers in Sri Lanka?” to, “What countries should I avoid if I am building a shared services center?”
 

In an effort to help address these problems, we are launching a new program after the turn of the year. The HRO Today Institute will be led by an advisory board of chief HR officers, senior HR executives, and thought leaders from some of the largest companies in the world. The executive director of the HRO Today Institute, Elizabeth Boudrie, formerly a research director of the Corporate Executive Board, will oversee the development of several exciting research programs for our growing InfoBank (available to subscribers), including detailed information from our various ratings programs, our market survey information, and HR opinion surveys. There will also be a catalog of white papers and thought leadership content. We will likewise be creating networks for knowledge sharing and generating special, invitation-only events to discuss these critical “how” issues. HRO Today Magazine has carved out its niche by reporting on how to manage HR services, technology, and outsourcing to “manage HR” and “empower HR,” because all organizations are “people driven.” We see this as a gap in the market and an extension of what we report and, in conversation with dozens of executives, a program that is sorely needed.
 

So, I predict in 2012 that “How” will be the new “Why.” You can contact vince.albergato@sharedxpertise.com for more information on the HRO Today Institute.
 

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