B.COM Unit – 4 ( CORPORATE SOCIAL RESPONSIBILITY ( CSR ).pptx
HR outsourcing
1. HR Outsourcing
Dr. G C Mohanta, BE(Mech), MSc(Engg), MBA, PhD(Mgt)
Professor
Al-Qurmoshi Institute of Business Management,
Hyderabad - 500005
2. HR Outsourcing
Any activity in which a company lacks internal
expertise and confidentiality, can be outsourced.
Outsourcing is a strategic decision to give a task or
activity to an independent contractor who determines
how best to do the task or activity.
The firm and the independent contractor become partners
and may establish a long-term relationship.
3. Why Outsource HR
Tightening labour markets and competitive
product markets – pressure to reduce head count
Cut costs
Add value
Do more with less
Upgrade, but not upsize
Downsize, but not downgrade
HR itself is becoming the target of belt tightening
Shed routine administrative tasks and focus on
talent management
4. Which Functions/Sub-systems
to Outsource
Recruitment – preliminary screening and short listing
Training – Trg. Needs identification, content
development, delivery, logistics, third party evaluation
Performance management - on line – automation
Compensation – pay roll and compensation surveys
Safety - inspections
Welfare – transport, security, catering
Labour contract – contract employees doing the job which
was earlier done by regular employees
Which function not to outsource
Decision making in each of the sub functions
Leading change and transforming the organization
5. Advantages & Disadvantages
of Outsourcing
Advantages
Cost reduction & savings
Financial and operational
flexibility
Need to focus on few things
Access to quality, expertise
& better management skills
Staffing flexibility
Disadvantages
Need greater coordination
flow with agencies
Reduces organizational
learning by depleting its
skill base
Loss of control
Adverse effects on morale
and motivation
Job insecurity
6. Factors Hampering HRO
Cost factor & Confidentiality
The fear of losing jobs
Loss of sensitive information to public/competition
Ethics and quality of outsourcing vendors
Possibility of security breaches
Cost-benefit equation not clear
Lack of psychological acceptance
7. Factors Hampering HRO
Cost factor & Confidentiality
The fear of losing jobs
Loss of sensitive information to public/competition
Ethics and quality of outsourcing vendors
Possibility of security breaches
Cost-benefit equation not clear
Lack of psychological acceptance