Managed HR: Enabling Growth from Administration to Strategic Function
By: Jim Westcott
Sponsored by: Ceridian Canada
Date of Publication: June 2005
Format: Adobe Acrobat (PDF file - 253 Kb)
Length: 20 pages
Introduction
The managed human resources (HR) market has entered a period of growth that has the potential to change the way businesses provide services to their employees. As a growing market, there are now many managed HR suppliers from which clients can choose. Based on the following considerations, IDC Canada believes that both clients and suppliers are gravitating towards a preferred HR outsourcing business model in which suppliers have strong HR capabilities both in breadth (expertise across all HR functions) and depth (long-standing experience in HR):
- Spending on HR outsourcing in Canada, excluding HR-related processing services is forecast to increase by more than 13%, on average, every year between 2005 and 2009.
- This spending estimate demonstrates that Canadian businesses are seriously considering all HR options including vendor managed HR services. IDC Canada research indicates that the standards for demand (buyer criteria) and supply (vendor offerings) in managed HR services are aligning around cost-effective solutions that improve organizational effectiveness through enhanced HR service delivery, allowing buyers to confidently choose the managed HR services option.
- Managed HR services are flexible and scalable; clients can choose how many (or how few) activities to outsource based on their specialized requirements. As clients grow more comfortable with outsourcing, they can add to the number of activities managed by their vendor/partner. As this occurs, clients of managed HR services must carefully choose a partner that can expertly match these growing needs.
- The evolution towards managed HR services will require considerably more effort on the part of clients to fully understand their business objectives for HR and the role played by external providers. This is of particular importance for companies that are new-comers to outsourcing.
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