10 tips to help you decide if HRO is right for your organization.

by Phil Fersht

There is no hiding from that fact that your company could save a great deal of money from adopting HR BPO and realize some great benefits. If you have yet to commit to handing over management of your most intimate business functionthe care of your staffcount your organization very lucky. Your job is to decide whether HR BPO is right for your organization and to investigate thoroughly whether a vendor can deliver what you need over the longterm. Here are some tips to get you started:


1. Conduct your HR due-diligence before engaging outsourcing consultancies and HRO suppliers.

You need to ensure you get the balanced and unbiased information you need, as once you start the selection process, you will come under a lot of pressure to commit to HR BPO. There have already been several high-profile examples of organizations that have rushed too quickly into outsourcing because they did not take enough care to study all the angles.


2. Set your expectations with vendors from the start.

The early stages of your outsourcing experience will be painful. Set things straight with suppliers from the outset, and ensure they handle your needs with patience and care. HR is hard to fix when things go wrong, and you may end up with serious internal implications


3. Dont be fooled by brand.

Beyond cost reduction, ensure the vendors understand your business, have the necessary investment in their own resources to respond to your needs, andperhaps most importantlyhave integrity. Moreover, just because a vendor has an established reputation in another services industry does not mean they will succeed in delivering quality HR services.


4. Get the balance right between great HR and the most appropriate technology.

HR BPO is a great opportunity to deploy solutions that enrich your employees experience and automate many cumbersome processes. The supplier with the deepest expertise in HR often does not possess the right IT solutions for your organizationand vice versa. Select suppliers who can deliver both competencies to the required standard, even if they are not the best-of-breed in each.


5. Leverage employee performance management (EPM) to gain a competitive advantage and complement HR BPO.

EPM extends traditional HR BPO beyond core administrative services and manages the entire employee lifecycle from talent acquisition and objective planning through training, performance management, and succession planning. EPM bridges the communication between employees, organizations, and HR BPO providers and ultimately aligns corporate objectives with individual goals.


6. Ensure your potential suppliers have global delivery capabilities.

It is one issue to have a successful HR delivery mechanism in the United States or the United Kingdom but another when you have offices spread throughout the world. Conduct a detailed review of where each supplier stations their contact centers and the caliber of the personnel they are employingespecially those who will be in direct contact with your staff.


7. Investigate third parties that specialize in HRO contract negotiation, and ensure you use a flexible, pragmatic approach to aligning your objectives with the potential offerings.

You will find a multitude of vendors competing for your business, and differentiating one from another can be difficult. There are some very experienced consultants and analysts who can help source the solution from the host of vendorsbut be careful they are not biased. Look carefully at the approach the consultancy is taking. Some offer very rigid, metrics-focused approaches that often miss crucial, non-quantitative issues that are imperative to HR transformation.


8. Learn from the mistakes of early adopters through the eyes of your peers.

The best way to develop the right outsourcing strategy is to spend time engaging with peers from organizations. SHRM, HROA, and the SBPOA are excellent forums to learn from other enterprises experiences, receive advice on outsourcing consultancy, and hear about the strengths and weaknesses of various HR BPO vendors through the eyes of the customer.


9. Be aware of the impact of the PeopleSoft/Oracle merger.

You need to be fully aware of the ramifications of the merger if you are going to be using a PeopleSoft HR platform. This could ultimately impact the quality of your service, so engage your potential service provider with this issue, and contact Oracle directly for a deeper understanding of how this affects your business.


10. Access research and benchmarking data to help your decision process. 
There are some detailed analyst studies that delve deeply into the minds of other users and will help you determine with which provider you should engage.   

Tags: Contributors, Multi-process HR, Sourcing

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