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The HRO impact on Corporate Relationships RDC September 2005. Speakers: Paul DeBeor,CRPACS Mike Brannan,CRP CENDANT Mobility Moderator : Tracy Hutton, CRP CENTURY 21 Scheetz. Topics for Discussion. What are your concerns ? Who is ACS and other HRO players? What is BPO vs. HRO? - PowerPoint PPT Presentation
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People Making Technology Work™
The HRO impact on Corporate Relationships
RDC September 2005
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People Making Technology Work™
Speakers:
Paul DeBeor,CRP ACS
Mike Brannan,CRP CENDANT Mobility
Moderator :
Tracy Hutton, CRP CENTURY 21 Scheetz
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People Making Technology Work™
Topics for Discussion
What are your concerns ?
Who is ACS and other HRO players?
What is BPO vs. HRO?
Scope of Services
Benefits of an HRO
Why an HRO?
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People Making Technology Work™
Founded in 1988
More than $4 billion in annual revenues
Fortune 500 Company
Diverse clients and industries
More than 50,000 employees
NYSE symbol: ACS
www.acs-inc.com
ACS & Business Process Outsourcing
Revenue Mix3/4 of revenue from BPO services Good mix of public and private sector business Revenues balanced across segments
Revenue Mix3/4 of revenue from BPO services Good mix of public and private sector business Revenues balanced across segments
Business Process Outsourcing
76%IT Outsourcing
24%
State and Local 51%
Federal6%
Commercial43 %
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People Making Technology Work™
Other HRO Players
Accenture HR Service
Aon Consulting
Ceridian
Convergys
Fidelity
Hewitt Associates (Exult)
IBM
Many Others (Industry in its Infancy)
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People Making Technology Work™
BPO vs. HRO
BPO = Business Process Outsourcing. This is a very broad term that refers to the outsourcing of any business function, not just HR related activities.
HRO or HRO-BPO = Human Resource Outsourcing. This can be broken down into 2 areas:
HR processing services which would include payroll processing, benefits admin, etc, but not with the transfer of management responsibility to the external vendor
HR BPO involves the comprehensive outsourcing of most, if not all, of the mgt and administration of all HR functions to a 3rd party.
There can be a 3rd step whereby an HRO becomes a true business partner by assisting in a client’s strategic HR focus and not just on transactional processing
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People Making Technology Work™
HRO Scope of ServicesVa
lue
Add
ed
HighLowComplexity of Interaction
High
Low
EmploymentServices
CorporateGovernance
Services
Recruitment, Assessment & Selection
Policy Inquiries & Resolution
International Service Personnel Admin.
Training Administration
Integrated Disability Case Management
Professional& Advisory
Services
Vendor Management
Labor Relations
Performance Management
Learning Management
Labor Relations Strategy
Overall HR Strategy
Relocation ServicesBenefits Administration
Job PostingEmployment Changes
PayrollBenefits Sign-up
Form Submission
Change Management Consulting
Transaction Services
HR Policy
Employee RecordkeepingHRIS
Employee Assistance Programs
Strategic Workforce Planning & AnalysisCompensation & Benefit Policy/Design
Employee Relations
Drug Testing
Compensation Administration
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People Making Technology Work™
HRO Benefits/Value
Financial/Cost Savings
Standardized processes
Measured and reported SLAs
Economies of scale
Avoidance of capital investments
Reduced headcount needs
Self service capabilities
Single point of contact
Off-Shoring Improved/consistent
employee satisfactionBetter able to effect
changes in policiesAccess to expertiseShift in HR focus
allowing retained employees to focus on strategic issues
Improved competitiveness
Risk mitigation
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People Making Technology Work™
Why an HRO ?
CLIENTS – Integration
Growth
Margin
Profitability
Increasing market share
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People Making Technology Work™
Why an HRO?
Of 122 surveyed companies with over $1Billion in Sales:
76% have already outsourced one or more major HR function (an increase form 62% in the prior year)
Another 15% have outsourcing in progress or plannedOnly 9% won’t outsource some HR function compared to 23%
the prior year (In the US it’s only 4%)More companies are looking at a single source HRO Two thirds of them are already in a shared services mode, with
more on the way – not a barrier to outsourcing44% of those that have outsourced have achieved their
objectives and 47% have partially met their objectives. Only 9% have not met their targets
Of those that have already outsourced, 45% will renegotiate, 26% will re-bid, and 29% will extend on the same terms and conditions…………0% will bring back in house.
Source: Accenture HR Services-The Conference Board, April 2004
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T H E A D V A N T A G E I S R E A L
September 28, 2005
Mike Brannan, CRP
Senior Vice President, Outsourcing Solutions
Topics for Discussion:Topics for Discussion:
Who is Cendant MobilityWho is Cendant Mobility Cendant Corporation overviewCendant Corporation overview Relocation is “in-scope” on most enterprise-wide Relocation is “in-scope” on most enterprise-wide
HRO engagementsHRO engagements HRO TrendsHRO Trends HRO Buyer CTQs (critical to quality HRO Buyer CTQs (critical to quality
measurements)measurements) Relationships with clients – past, present, futureRelationships with clients – past, present, future Open discussionOpen discussion
Cendant Mobility
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Asia PacificThe Americas Europe, Middle East and Africa
Over 2,300 employeesOver 2,300 employees 13 office locations on 4 13 office locations on 4
continentscontinents 49 languages49 languages Globally linked on one Globally linked on one
platformplatform
Cendant Mobility Legend
Offices
Service Centers
Doing business in
Cendant Mobility | Reach & Expertise
Our Parent – Cendant CorporationOur Parent – Cendant Corporation
Vehicle Services• Avis• Budget
Travel Distribution Services• Galileo International• Highwire• Cheaptickets.com• Travelport• Orbitz
Real EstateServices
Financial Services• Trilegiant• Progeny• Cims
Hospitality Services• Days Inn• Howard Johnson• RCI• Cuendet• Wingate
• Ramada• Fairfield Resorts• Knights Inn• Holiday Cottages
Total HRO SolutionTotal HRO SolutionRelocation is “in-scope”Relocation is “in-scope”
Benefits Admin
Data Mgmt
Training
Employee Contact Centers
Mobility
Recruiting
Compensation
Payroll
HROSolution
Growth: Growth: HRO industry is expected to continue to grow. HRO industry is expected to continue to grow. Global HRO Market Global HRO Market growing and expected to reach over $80 billion by 2008growing and expected to reach over $80 billion by 2008
Mid Markets: Mid Markets: HROs will continue to focus on mid market (companies with HROs will continue to focus on mid market (companies with 20k employees and less). 20k employees and less).
Year of the Skeptic: Year of the Skeptic: Due to market maturation, former buyers who Due to market maturation, former buyers who were skeptics are entering the market were skeptics are entering the market
Globalization:Globalization: Through consolidationThrough consolidation and partneringand partnering HROs will continue HROs will continue
to expand their global footprint to assist their clients in globalizing HRto expand their global footprint to assist their clients in globalizing HR
Standardization:Standardization: No more “mess for less”; now vision with standards. No more “mess for less”; now vision with standards. HROs are cross pollinating best practices amongst their clients and actually HROs are cross pollinating best practices amongst their clients and actually transforming HR servicestransforming HR services
Sources: HRO Today and The Yankee GroupSources: HRO Today and The Yankee Group
Projected 2005 HRO Trends
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1. Execute on Buyer’s Vision of the Future State1. Execute on Buyer’s Vision of the Future State
• Capabilities – self service applications, automation & productivity Capabilities – self service applications, automation & productivity
• Flexibility – global reach and IT infrastructure Flexibility – global reach and IT infrastructure
• Capacity - ability to handle growth (geographic, M&A, JV etc..)Capacity - ability to handle growth (geographic, M&A, JV etc..)
2. Cultural Fit and Chemistry of HRO’s Delivery Team2. Cultural Fit and Chemistry of HRO’s Delivery Team
• Six Sigma/Process Improvement TechniquesSix Sigma/Process Improvement Techniques
• Service CentersService Centers
3. Cost Savings3. Cost Savings
• Now an expectation Now an expectation
Sources: Equaterra ConsultingSources: Equaterra Consulting
2005 HRO Buyer’s Top 3 CTQs
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Relocation Supplier Support Relocation Supplier Support Structure (early 1990’s)Structure (early 1990’s)
Client Contact
3rd Party Relocation Company
Household Good Providers
MortgageProviders
Real Estate Community
Impact of Relocation Outsourcing Impact of Relocation Outsourcing (late 1990’s to present)(late 1990’s to present)
Client Contact
3rd Party Relocation Company
MortgageProvider
Household GoodsProvider
Real EstateCommunity
Select Preferred Suppliers
Impact of HR BPO Impact of HR BPO (immediate future state)(immediate future state)
Client Corporationclient contact
changes
HR BPO Provider
3rd Party Relocation Provider
Real Estate Community Other Service Providers
HRO Provider might work directly with Real Estate Community and Other Service Providers
How can Relocation Director’sHow can Relocation Director’sstrategically position their strategically position their
departments for the future ?departments for the future ?
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