As recently as two years ago, all new HRO trends came from the U.S. But fast-forward to November 2006, that will forever mark the date when the big HR transformation trends started on the east side of the Atlantic. Here are the four trends that made headlines from this year’s HRO World Europe Conference.
When we started HRO World Europe in November 2004, we felt just a slight bit imperialistic. Sure, we featured the big HRO deals from Great Britain—BP and BT. And we had our local partners, our friends from SharedXpertise in Brussels. But all the big trends, topics, and to-do’s were American.
To make our cultural arrogance even more vivid, we ourselves are American. We spelled “organization” with a “z.” Our “program” was missing an extra “m” and that final “e.” We talked about deal values in dollars rather than pounds or Euros. And we pronounced the letter “r” hard, like growling dogs.
Keep in mind, at that point in 2004, the U.S. was seen as the world’s stupidest government by most everyone east of Wheeling, WV. Our Iraq folly was going nowhere fast, and our policy was starting to get Europeans killed too. Every European or Brit on earth knew every detail of less murderous American acts of idiocy.
The 2005 HRO World event was a little better, but not much. Nearly 75 buyers were among the 350 attendees, which represented the largest assembly of HRO buyers east of New York City. But it still fell short of the hype. (At the time, we wrote, “The European HRO mega-trend busts out at HRO World Europe 2005.” Oops.)
Finally, the 2006 HRO World Europe show met all expectations. Registered attendees totaled 324, and 161 of them were HRO buyers or buyer representatives. In conference terms, this was a smash hit. A 50-50 ratio of buyers to others is virtually unheard of.
But more to the point, many of the big trends in the show were driven by European buyers and sellers. Here are four that we noted:
• First, the Oracle and SAP battle extends into HRO. Following the leadership of BPO visionary Dr. Christian Baader, SAP has set the BPO pace for all enterprise software providers. But recently, understanding the strategic importance of the HRO provider community, Oracle jumped into the battle. And the first public conference confrontation between the two behemoths was on stage at HRO World Europe.
• Second, brutal honesty. “Boosterish,” “sycophants of the highest order,” “mouthpieces for the vendor community,” “long on hype and short on substance,” and “unrealistically optimistic” were just some of the knocks on previous conference presentations. But this year, along came IKEA’s corporate HR leader Albert Martens, who has outsourced payroll and workforce planning to ADP and SAP. His presentation was the first that could be called long on fact, brutally honest, and short on hype. His cost-driven and scale-conscious selection process description has certainly set the stage.
• Third, rationality rules. During the first few years of the HRO trend, the faithful required as much bravery as brains. There were more questions than answers. But the Europe-based Unilever deal with Accenture HR Services set a new standard for mature, fact-based (rather than faith-based) contracting.
• Fourth, the rise of “HR transformation.” Because we invented the term “HRO,” we have been (understandably) interested in its promulgation. But as it turns out, HRO is but a subset of the world of “HR transformation” processes going on at companies around the globe. A large minority of those “transformation” projects do involve some flavor of HRO, but to disregard the larger number of shared-services operations and single-function HR outsourcing projects would be to misrepresent the market. This year’s HRO World Europe Conference was all about “HR transformation,” which is a phrase that inspired this year’s record number of buyers to attend. In the years to come, expect to hear much more about HR transformation state-side as well.