mahindra&m hr activities
DESCRIPTION
about operation in M&MTRANSCRIPT
RESEARCH REPORT
ON
IMPACT OF OUTSOURCING HR ACTIVITIES ON PRODUCTIVITY OF MAHINDRA AND MAHINDRA LTD.
Acknowledgement
Expression of sincere gratitude is just a partial acknowledgement. My vocabulary
falls short of word to express my sincere gratitude to All faculty members of
PGDM under whose guidance I had the opportunity to carry out the present
work.
The objective of research report is to provide us with an opportunity to
experience the practical aspects of management and its functioning.
This project report not be possible without the guidance of My All faculty
members (PGDM),who inspired& gave their valuable suggestion.
Thanks are due to my learned faculty member’s professor for their constant
encouragement and giving me this opportunity of doing summer training.
VIKAS ARORA
PREFACE
The project prepared gave me an opportunity of learning the impact of outsourcing HR activities. I learned and discussed important points that are related to my report. I learned and study on different topics of P&A like HRD ,performance appraisal, job evaluation , industrial relation.
The purpose of this report is to provide an accessible account of the key issues currently confirming the industries. The report looks at a couple of the basic function of personnel department and the perception of worker and management regarding “IMPACT OF OUTSOURCING HR ACTIVITIES ON PRODUCTIVITY”.
I studied about the Mahindra & Mahindra’s history, functions, products, performance appraisal , departments like recruitment and selection and many more.
CONTENTS
Executivesummary
About the topic
Outsourcing is subcontracting a process, such as product design or
manufacturing, to a third-party company. The decision to outsource is often made
in the interest of lowering firm or making better use of time and energy costs,
redirecting or conserving energy directed at the competencies of a particular
business, or to make more efficient use of land, labor, capital, (information)
technology and resources
Types of Outsourcing
Business Process Outsourcing
Information Technology - 28%
Human Resources – 16%
Sales & Marketing – 15%
Finance – 11%
Administrative – 9%
Least Commonly Outsourced Functions
Performance Management 3%
Strategic Business Planning – 4%
Policy Development/Implementation – 4%
Employee Communication Plans – 10%
The objectives of study are:
To realize economies of scale and achieve standardization of services.
To define the concept of hire on contract policies& promotion.
To describe the various procedure followed by Mahindra & Mahindra.
To assess the views of the worker and management in context of these
scheme.
Why Outsource?
● Allow HR to focus on core competencies
● Creates strategic opportunities for HR professionals
● Improve quality, efficiency, and effectiveness
● Relief from administrative burdens
● Reduce operating costs
Impact on Companies
●Employee reactions
● HR executives taking part in operational and strategic decisions
●Elimination of bureaucracy
●Customer service improvements
●Growth of self-service platform
●Slimming down staff
●Cost savings
INTRODUCTION
What is Outsourcing?
The performance by outside parties, on a recurring basis, of tasks that would
otherwise be performed in-house.
Outsourcing is subcontracting a process, such as product design or
manufacturing, to a third-party company. The decision to outsource is often made
in the interest of lowering firm or making better use of time and energy costs,
redirecting or conserving energy directed at the competencies of a particular
business, or to make more efficient use of land, labor, capital, (information)
technology and resources
Human Resource Outsourcing
One very important trend in the recent times has been the growth of human
resource outsourcing. HR outsourcing is the outsourcing of peripheral but
necessary administrative tasks such as payroll, benefits, education/training,
recruiting personnel, administration, to realize economies of scale and achieve
standardization of services.
Rapidly changing market dynamics and global competitive pressures have
caused organizations to spend more time focusing on their core business.
Organizations are fast realizing that they can't be all things to all people. So
companies now, be it a software company, a service provider or a manufacturing
firm, decide what they are good at and outsource everything else, i.e., focus on
their core competency, and let someone else do the rest in a more efficient and
cost-effective manner.
As a result, human resources outsourcing is becoming increasingly prevalent.
The number of companies outsourcing HR activities continues to rise, and the
scope of outsourced HR activities continues to expand. HR outsourcing can
happen in HR functions, like payroll administration (producing checks, handling
taxes, dealing with sick-time and vacations), employee benefits (Health, Medical,
Life insurance, Cafeteria, etc), human resource management (hiring and firing,
background interviews, exit interviews and wage reviews), risk management, etc.
Outsourcing has become a common response to manage people and technology
resources strategically, enhance services, and manage costs more effectively.
Outsourcing noncore activities allows HR professionals to move away from
routine administration to a more strategic role. The organization can focus on
higher value-added activities while the outsourcing provider takes care of the
day-to-day administration. Critical internal resources, such as technology and
talent, can be devoted to company's core business. Outsourcing reduces the
need for large capital expenditures in noncore functions. Thus, outsourcing
becomes a strategy for reducing the capital intensity of the business. This
strategy has gained popularity as companies aim to become more nimble and
gain the speed and flexibility necessary to compete in today's business
environment. A growing number of executives understand the benefits it can
bring in terms of not only cost savings, but also heightened strategic focus. Many
recognize outsourcing relationships as long-term partnerships created to further
the strategic goals of the organization
The HR outsourcing business opportunity is large and India is likely to garner a
larger and larger piece of this pie in the future. India, with its intrinsic advantages
such as low cost, ready pool of English speaking manpower and geographic
positioning, is emerging as a viable destination for HR outsourcing companies to
set up their businesses.
But still here people are not very clear about what exactly is manpower
outsourcing all about, and issues like quality and trust needs to be addressed
properly. Experts say the basic reasons hampering the growth of HR outsourcing
in India are confidentiality and cost factors. Moreover, the fear of losing jobs,
losing control over confidential data, ethics and quality of outsourcing vendors,
security breaches and overall confidence in the vendors deters many
organizations. The biggest problem - and this is why the HR outsourcing industry
in India is on the back foot - is the government and the industry's failure to tackle
issues like data security and data privacy. This is where Indian HR outsourcing
companies face a major handicap. The Indian government is still grappling with
drafting a data protection law designed to quell growing privacy concerns from
their offshore clients.
However, the future seems to be very promising. It's set to become a $ 51 billion
market worldwide in 2005, representing 39 per cent of the total business process
outsourcing revenue. Estimates show that the latent size of HR outsourcing in
India is about $ 2 billion with a current market of $ 27 million and it is growing at
an alarming rate of about 50 per cent. India has immense potential as more than
80% of fortune 1,000 companies are discussing HR outsourcing as a way to cut
costs and increase productivity.
Right now, India is barely skimming the surface of the HR outsourcing market
potential. Indian life Hewitt (ILH), FIDELITY, EXULT and MAFOI are some of the
prominent HR outsourcing services providers in India and the clients include
giants of manufacturing, software and service industries like GE Capital, Ford
Motors, Hyundai Motors, Satyam Group, Infosys, Enron, Haldia Petrochemicals
and HSBC, to name a few, but many more needs to be added to that list.
HR outsourcing has a huge potential for employment also. Nasscom numbers
are a million software jobs by 2005; HRO would be about a 25 per cent of that.
Experts believe that in present times HR outsourcing is undergoing a transition
phase, it would still be sometime before we see increased levels of HR activities
being outsourced to India as lack of domain knowledge and quality are some of
the critical issues.
ACTIVITIES TO OUTSOURCED
– Payroll
– Benefits
– Recruiting, Staffing, & Search
– Training
– HRIS & Web-based services
: How many of you outsource all of your HR function?
: What led to the decision to consider outsourcing?
Why Outsource?
: Allow HR to focus on core competencies
: Creates strategic opportunities for HR professionals
: Improve quality, efficiency, and effectiveness
: Relief from administrative burdens
: Reduce operating costs
Other Benefits to HRO
: Access to outside HR expertise
: Greater diversity of HR services
: Leverage vendor investments in technology rarely available to HR organization
: Limit fiduciary, audit, and litigation risks and liabilities
: Upgrade level of customer service
: Ease time pressure demands
:“Better, faster, cheaper”
Risks
: Over promise and under deliver
: Nonperformance of key function
: Cost
: Loss of institutional knowledge
: Difficulty managing vendor relationship
: Change in provider’s business or financial stability
: Lack of fit with company culture
: Organizational resistance or unreadiness
Considerations
: Core Competency?
: Best in Class?
1. What is your vision for your HRM business?
2. What metrics will measure progress toward vision?
3. What business outcomes are needed from the HRM aspects of the
business?
Outsourcing Myths
: Outsourcing is just a fad
: Outsourcing can be kept secret from employees
: Outsourcing is only for the largest companies
: Messes must be fixed before outsourcing
: Outsourcing is for everyone
Trends in HR Outsourcing Market
: Specialization
: Globalization
: Standardization
: Regionalization
: Consortia Buying
: Mid-market Mania
: Utility Model Evolution
: Consolidation and Partnering
The Future of HRO
1. Growth-Maturation of HRO market
2. Increasing weight of non-cost drivers
3. “Commodization” of HR functions
4. New roles for internal HR departments
5. New career opportunities for HR professionals
6. Expansion of small/mid-sized HRO markets
7. Demographic changes
8. Improved HRO metrics
9. Reshaping of industry
Impact on Companies
: Employee reactions
: HR executives taking part in operational and strategic decisions
: Elimination of bureaucracy
: Customer service improvements
: Growth of self-service platform
: Slimming down staff
: Cost savings
: Model will serve to guide other organizational functions (IT, accounting)
Impact on HR Profession
: Internal HR at significant disadvantage in cost per transaction
: Loss of control of key processes
: Enhanced credibility
: Strategic focus
: Decentralized structure
: Internal politics – HR as business partner
: Move to customer service culture
: Management and Organizational Development – big picture view
: New roles – consultant and HR strategist
: Develop competencies to remain valuable
: HR is exposed and more visible as organizational function
: HR is far more measurable
: Align HR strategy with corporate goals
Definitions
OUTSOURCING
The transfer of the provision of services previously performed by in-house
personnel to an external organization, usually under a contract with
agreed standards, costs, and conditions. Areas traditionally outsourced
include legal services, transport, catering, and security. An increasing
variety of activities, including IT services, training, and public relations are
now being outsourced. Outsourcing, or contracting out, is often introduced
with the goal of increasing efficiency and reducing costs, or to enable the
organization to develop greater flexibility or to concentrate on core
business activities. The term subcontracting is sometimes used to refer to
outsourcing.
PRODUCTIVITY
Maintaining a high productivity is the life of a successful business all around the
world. No matter how much money you invest in your business without
productivity implementation strategies your business would not progress and
would eventually collapse.
Productivity in an industrial context is output of an aspect of
production per unit of input.
It is a method used to measure the quantity of output of worker, machine, or an
entire national economy in the making of good, services, or commodities to
produce income.
Other Definitions
In-sourcing
Off-shoring
Co-sourcing
Geo-sourcing
Outplacement
BENEFITS OF PRODUCTIVITY
In improving the productivity of a company, the business will gain many benefits.
These can include:
Increase in income/profitability.
Lowering running costs/operational costs.
Maximizing the use of all of the company’s resources such as land,
equipments/machineries, factory, workers, and etc.
Gaining a greater share of the market.
More cash flows mean more opportunity for the company to expand and
grow.
WHY THE OUTSOURCING RUSH?
What are the reasons for the growth in HR outsourcing? How do
companies gain by outsourcing their HR activities? HR outsourcing is
considered a viable option, if a company lacks internal expertise and
confidentiality and requires unbiased opinion on human resources.
Outsourcing is also gaining importance as most companies do not have
the time or the expertise to deal with situations.
Outsourcing has become popular because companies are finding that
external vendors-through technology and economies of scale-can
provide more efficient and cost-effective HR services than in-house
departments. The best example of a firm that has reaped early
benefits from outsourcing is BP. In 1999, it outsourced its activities to
Exult in the USA and UK for services like payroll, recruiting,
expatriation, records management, vendor management and
relocation services for 63, 000 employees.
The only function that remained in-house was BP’s learning and
development program in the United States. Over the last two years,
the company has reaped many benefits from this arrangement. Payroll
processing became more timely and accurate. Employees got their
benefits questions answered sooner. HR processes have been
standardized across the company. And for the first time, BP has
measurable data on which HR activities are effective.
As a result, its core HR staff has been slashed by 65 percent-from 100
to 35 people. Such success stories have propelled companies like
Sony, AT&T and American Express to outsource HR activities. One of
the main reasons for HR outsourcing that most companies quote is that
such outsourcing helps them to get rid of routine transactional HR
work. Some of the companies which have gone ahead with even
manpower hiring outsourcing practices are Cisco, GE, Honeywell, Sun.
BENEFITS OF OUTSOURCING
When a number of companies are outsourcing their HR activities, there
must be certain benefits associated with it. The major advantage is the
cost and the time factor. According to India Life Hewitt, Vice-President,
Leo Fernandes, “For large organizations to service their mammoth
payroll by themselves is a huge drain on their resources. Outsourcing
this one activity alone is huge direct cost saving for large legacy
companies which could be in the range of 20 to 40 per cent." 2
The major benefits of HR outsourcing are as follows:
• Fosters Innovation
• Increased speed to market
• Improved quality
• Focus on core competence
• Cost reduction
• Reduced administrative costs
• Improved customer service
• Insufficient staff
• Conserve Capital
THE INDIAN SCENARIO
Indian companies are also not lagging behind in outsourcing their HR
activities. LG Soft India has outsourced its PF management, Escosoft
has outsourced payroll processing, execution of training programmes
and survey conduction. Depending on their need, outsourcing can be
transactional or HR Consulting. In India transactional outsourcing is
more prevalent .
In the value chain, it falls at the lower-end compared to HR
consultancy, although it happens to be an essential function. According
to Harish Chopra, whose firm Harish Chopra & Associates has garnered
a large chunk of financial sector HRO over the years: “An investment
bank would prefer to recruit investment bankers rather than HR
specialists. And given their minimum salaries and establishment costs,
HR administration would cost them twice as much 4.”
The HR outsourcing fever has not only spread to large companies but
many small and medium sized companies are also welcoming this
trend. Salary and Benefits Processing, Benefits Administration, and
Compensation Benchmarking & Design are the most frequently
outsourced HR activities in India. According to a study conducted by
the Institute of Management Accountants (IMA) in mid 1990s, mid-
sized companies spent more on the routine transactional work in
finance and accounting services than large companies and maintain 79
percent more headcount .
This kind of cost is felt even more in the routing HR work. According to
the survey more that 87 percent of the funds mid-sized companies’
budget for finance and HR go towards routine processing transactions,
rather than policy making strategies and analysis that
could move their business forward. This is clearly counterproductive for
organizations set on high productive model
INDIA AS AN HR OUTSOURCING DESTINATION
India is emerging as a major player in HR outsourcing. Though there
are hardly five to six names in this market, they are trying to make a
mark for themselves and tap the potential of providing HR outsourcing
services. Companies like Mahindra and mahindra are expanding their
horizons by extending their services to the indian region. However,
overseas HR servicing companies are beginning to view the Indian
market as a viable investment destination, where they can set up their
operations and cater to the rest of the international market.
The $450-million Exult Inc. started a 70-people outfit in Mumbai. From
the tactical and straightforward handling of payroll and benefits, HR
services providers are moving into the strategic world of BPO. HR-
enablers are helping HR managers free themselves from the routine
jobs and work towards taking employee services to a higher level.
India, with its intrinsic advantages such as low cost, ready pool of
English speaking manpower and geographic positioning is emerging as
a viable destination for HR outsourcing companies to set up their
businesses. The HR outsourcing business opportunity is large and India
is likely to emerge as a major player in this market. Patni Computer
Systems is looking to leverage its work done on 401K pension plans to
get into HR. Daksh has started payroll processing. The $5-billion
payroll processor, Automatic Data Processing is also planning to start
operations in Hyderabad.
The various HR processes that companies are venturing into include
data entry, payroll processing, staffing, training, resume management,
compensation, employee communications, pension plans, leave
administration and HR data analytics. The popular delivery models for
HR services outsourcing are self service, call center back up or shared
services involving high caliber HR professionals who play a
consultative role to line managers.
When compared to other regions, India holds an advantage in HR
outsourcing because of cost factor and education of the workers.
IS THE MARKET STILL UNEXPLOITED IN INDIA?
Despite all these figures and numbers mentioned above, HR
outsourcing is still considered to be unexploited. There are a number of
deterrents that are keeping companies from moving to HR outsourcing.
The basic reasons hampering the growth of HR outsourcing in India are
confidentiality and cost factors. Many companies outsource only a bit
of their requirements because of the above two factors.
Besides, the fear of losing jobs, losing control over confidential data,
ethics and quality of outsourcing vendors, security breaches and
overall confidence in the vendor deter many organizations. According
to V. Kartikeyan, the director-human resources of Texas
Instruments India,
“Some companies can also be reluctant because they may not have an
adequate grip over the cost-benefit equation of outsourcing.
Companies need to be convinced before they can outsource select HR
activities.”6 The basic cultural mindset and the acceptance at the
psychological level add to the deterrents. An in-house HR person
handles certain situations that an outsourcing agency cannot handle
well (things like building employee incentive programmes, taking care
of recognition for employees).
At times, many employees would want someone in-house to resolve
their work-related problems or disputes. All this is only possible if there
is an in-house HR team, which interacts with the employees on a daily
basis. Quality at times forms another roadblock. The issues of pricing
also play an important role as there is no standards benchmark for
pricing and it varies from vendor to vendor. Doing reference check
helps a lot in this case.
THE FUTURE AHEAD
The future of HR outsourcing in India is poised to be very effective
because of its intrinsic advantages such as low cost, ready pool of
English speaking manpower and geographic positioning is emerging as
a viable destination for HR outsourcing companies to set up their
businesses. While currently there are only a few major players the
trend seems to be catching up as companies are showing marked
interest to improve on services such as pay roll benefits as well as
complete HR delivery.
Companies are looking to outsourcing the complete range of HR
delivery and designing products on policies, compensation, structure,
and recruitment. Indian companies are not only providing services for
the clients abroad but are also catering to the local market. Moreover
these players are moving up the value chain.
Mafoi has emerged as a major HR outsourcing center (Refer exhibit on
HR outsourcing at Mafoi consultants). It is estimated that currently the
organized sector of HR is catering to only two percent of the whole
market . This is the right time for the players to tap this emerging
market.
Contract-To-Hire And Recruiting Agencies
You may be wondering how staffing companies recruit applicants. They can
recruit in a number of ways. They may advertise in newspapers, through job
fairs, virtual communities, and online job boards.
You may have seen ads in newspapers for contract-to-hire positions. A majority
of these ads are placed by staffing companies to recruit applicants or contractors.
They normally don’t reveal the name of the hiring company until they set you up
with an interview.
Job fairs are a second method used to find potential applicants. If you’re
interested in attending a job fair, you normally find them advertised in
newspapers. You may even do a search on the Internet for job fairs in your area.
Online job forums are an effective recruiting method. The service is generally
free and does not take very much time to post. The recruiter normally posts the
job description, requirements, and the contact information. Applicants generally
are asked to send a copy of their resume and a cover letter explaining why they
think they are a good fit.
The fourth recruiting method is online job boards. These are similar to newspaper
ads, but are placed online at employment sites. You can expect the ads to read
much like a newspaper ad.
Contract-To-Hire: Why Use A Staffing Agency?
There are many benefits to using the services of a staffing company. Staffing
companies have staffing and recruiting teams. Their job is to recruit, pre-screen,
and test individuals. By the time an applicant is sent on an interview, that person
has already been tested thoroughly and his skills have been assessed. Staffing
companies are interested in keeping their clients; therefore, they work hard at
matching an individual with the company or position that best suits him. Everyone
wins in this case. The staffing company keeps the client happy; the applicant
thrives on his job because he’s capable of performing the duties well, and the
hiring company gets a capable, productive potential employee.
Another benefit to using a staffing company’s services is that they are
responsible for conducting credit and background checks. Especially if your
business deals with sensitive, confidential information, you can feel confident that
contractors sent to you have already gone through all the screening checks.
Still another benefit, if for whatever reason you decide that things are not working
out, you simply terminate the contract. There is no legal obligation to keep the
contractor any longer than you need or wish to keep him. If you are the
contractor, using a staffing company benefits you, because if you decide that you
don’t want to continue with a certain company, you too can terminate the contract
without any legal obligations.
Contract-To-Hire Employment
This type of position is becoming more popular and easy to find. If you prefer to
seek employment on your own rather than through a staffing company, you can
still succeed. You would proceed the same way as with a direct hire position.
Look in newspapers. Make sure that the contact information is for the hiring
company and not for a staffing agency. Go to online employment sites and enter
a search for the term “contract-to-hire” in your area. Larger companies
sometimes have job fairs. You can do a search for job fairs in your area as well,
and make sure you attend.
Having your resume ready, your work history, and references along with a cover
letter increases your chances of finding a position. Resumes and cover letters
take time to put together. If you have these items ready, you can forward them as
soon as you see an ad. All you will need to do is update the position on the
resume. The cover letter may require a few more updates such as the position,
contact person, and maybe their address. Make sure you have the correct date.
RESEARCH ANALYSIS
OVERVIEW
Payroll
The term 'payroll' encompasses every employee of a company who receives a regular wage or other compensation. Some employees may be paid a steady salary while others are paid for hours worked or the number of items produced. A payroll specialist calculates all of these different payment methods and the appropriate paychecks are issued. Companies often use objective measuring tools such as timecards or timesheets completed by supervisors to determine the total amount of payroll due each pay period.Setting up an effective payroll system is not especially difficult for trained accountants, but it can be very time consuming. Some smaller businesses rely on user-friendly computer software to set up a simple payroll system complete with check printers and file storage. Larger companies may assign trained accountants to handle payroll issues as part of their overall duties. But many businesses without the means to maintain their own payroll systems choose to farm out this task to outside specialists.
HR Consultation services
Personnel Policies Records Retention Consultation Compensation/Benefits Analysis and Planning Employee Training and Orientations Succession Planning Strategic Planning Wage and Hour consultation FMLA/OFLA Consultation Employee Relations Consultation Team Building and Issue Resolution Facilitation
TRAINING
FEATURES
Increases knowledge and skills for doing a job.
Bridges the gap between job neegs and employee skills / knowledge and
behavior.
Job-oriented process, vocational in nature.
Short-term activity, desinged essentially for operative.
IMPORTANCE OF EMPLOYEE TRAINING
REDUCTION IN COST OF PRODUCTION: Efficient workers do their works in
the best possible manner. they make the maximum utilization of materials and
machines. thus, the cost of production is reduced.
MAXIMUM UTILIZATION OF MATERIALS AND MACHINES: Training teaches
the employees of the enterprise the method of doing their job in the best possible
manner.
MINIMUM POSSIBILITY OF ACCIDENT: Trained worker know the methods of
doing their jobs in the required manner. the know-how to use the machines in the
best possible manner. it reduces the possibility of accidents to the minimum.
STABILITY IN ORGANIZATION: Training brings stability in organization,
because it reduces the rate of absenteeism and labor turnover. it enables the
worker to do their works in the absence of any supervision.
HIGH MORALE: As the trained workers are capable in doing their jobs in most
suitable manner and can understand the procedures and methods easily, it
increases their morale. it gives them satisfaction in their work.
IMPROVEMENT IN THE QUALITY AND QUANTITY OF PRODUCTION:
Training increase the efficiency of employee which increases the quantity of
production and improves its quality.
MINIMUM NEED OF SUPERVISION: A trained worker can do his work himself
efficiently. thus, the training reduces the need of supervision to minimum.
HELPFUL TO MANAGERS: As there is minimum need of supervision, it helps
the managers of the enterprise to concentrate upon the important problems of
enterprise. they have not to waste their valuable time on supervising the workes.
Types of Outsourcing
: Business Process Outsourcing
: Information Technology - 28%
: Human Resources – 16%
: Sales & Marketing – 15%
: Finance – 11%
: Administrative – 9%
: All Others – 22%
How Common is HRO?
58% of companies outsource some HR function2
: 91% of companies with $1 billion+ annual revenues are now considering HRO3
: HRO grew 28% from second half of 2004 to first half of 20054
Other Types of HR Outsourcing
: Pension Benefits Administration – 55%
: Temporary Staffing – 54%
: Retirement Benefits Administration – 47%
: Payroll & Software Services – 48%
: Recruiting, Staffing & Search
– Non-executives - 30%
– Executives - 29%
: Employee Relocation – 29%
: Training and Development – 21%
: Incentives – 19%
: HRIS & Web-based Services – 15%
: Reference Checks
: PEOs and ASOs
: Sourcing Consultants & Legal Services
: Screening & Workplace Security
: Process, Project, and Systems Management
Least Commonly Outsourced Functions
: Performance Management 3%
: Strategic Business Planning – 4%
: Policy Development/Implementation – 4%
: Employee Communication Plans – 10%
0 2 4 6 8 10
Employee CommunicationPlans
PolicyDevelopment/Implementation
Strategic Business Planning
Performance Management
Series1
Audience Survey
: How many of you outsource part of your HR function?
– Payroll
– Benefits
– Recruiting, Staffing, & Search
– Training
– HRIS & Web-based services
: How many of you outsource all of your HR function?
: What led to the decision to consider outsourcing?
Why Outsource?
: Allow HR to focus on core competencies
: Creates strategic opportunities for HR professionals
: Improve quality, efficiency, and effectiveness
: Relief from administrative burdens
: Reduce operating costs
Other Benefits to HRO
: Access to outside HR expertise
: Greater diversity of HR services
: Leverage vendor investments in technology rarely available to HR organization
: Limit fiduciary, audit, and litigation risks and liabilities
: Upgrade level of customer service
: Ease time pressure demands
:“Better, faster, cheaper”
Impact on Your Career
: Transformation – from transactional administrator to business partner that sets
strategy
: Develop competencies to negotiate and manage vendor relationships
: Demonstrate ability to provide business solutions for employee and customer
problems
: Change bureaucratic culture
: Develop strategic expertise necessary to manage human capital
: Deliver exceptional customer service
: Sharpen your skills
: Build/Develop your network
: Stay on top of trends and their implications
: Utilize vendors now so that they can help
you later
Satisfaction
Recent survey of 129 large companies representing 2 million employees9:
: 89% satisfied with outsourcing arrangement
: 85% achieved hoped-for benefits
: Additional 20% achieved unexpected benefits
0 20 40 60 80 100
achieved unexpectedbenefits
achieved hoped-forbenefits
satisfied
Series1
Overview of Process
1. Planning
2. Exploring strategic initiatives
3. Analyzing costs/performance
4. Selecting providers
5. Negotiating terms
6. Transitioning resources
7. Managing relationships
: Prepare HR
– Develop and communicate new HR strategy
– Define new roles and responsibilities
– Restructure HR
– Hire new employees to fill skill gaps
– Provide training for employees in new roles
: Prepare Organization
– Develop HR strategy within overall organizational strategy
– Communication plan
– : Resolve issue of whose payroll individuals
are now on
– Are HR employees actually employees
of provider?
– Does head of HR work for company or provider
: Assessment
– Self examination
– SWOT of department
– Organizational scan
: Define opportunities and benefits
: Build the business case – consider all costs and impacts on organization
: All functions that are not core competencies should be considered for HRO
– nothing is sacred
: Consider the driver behind HRO decision
Analyzing Cost/Performance
: Understand market trends and competitive position
: Identify goals and objectives
: Determine added value
: Gather baseline HR costs and metrics
: Compare current HR operations to benchmarks
: Determine which processes have highest strategic importance and add most
value
Negotiating Terms
:“Good contracts make good partners”
: Maintain heat of competition during negotiation
: Reasonable, but clearly established, expectations
: Well-documented deliverables regarding every aspect of deal
: Attorney involvement
Specifications of Contract
Contract Duration
– Exact beginning and ending dates
– Financial penalties for early termination
: Parties to the Contract
– Allow for additions or deletions (in case of acquisitions or
divestitures)
– Require vendor to name all subcontractors and give you right of
approval for those introduced later
Services Performed
– Specify all functions to be provided
– Outline all support services
– Ensure escalation process and dispute governance included
: Performance Standards
– Tweak standard performance guarantees
– Reinforce performance guarantees through at-risk fees
:Hold-Harmless Statement
: Fees
: Data Security
: Communication Review
: Contingency Plans
: Audits
: Final Contract Review
RESEARCH
METHODOLOGY
RESEARCH PROBLEM
I have selected that IS PRODUCTIVITY INCREASE THROUGH HR
Outsourcing as research problem for my research report.
As a research problem is the situation that causes the researcher to feel
apprehensive, confused and ill at ease. It is the demarcation of a problem area
within a certain context involving the WHO or WHAT, the WHERE, the WHEN
and the WHY of the problem situation.
RESEARCH OBJECTIVE
How productivity relates with performance appraisal. In addition, the
major factors of performance appraisal, which have taken a part in
increasing productivity of the organization.
RESEARCH DESIGN USED
As research design is simply the framework or plan for a study i.e. used
as a guide in collecting and analyzing the data. Research design can be
grouped into three categories-exploratory research, descriptive research and
casual research.
I have used exploratory research design in my project.
EXPLORATORY RESEARCH
Exploratory research studies are also termed as formulating studies. The
main purpose of such studies that of formulating of the problem for more
precise investigation or of developing the working hypotheses from an
operational point of view. An Exploratory Research focuses on the discovery
of ideas and is generally based on secondary data. It consists;
Search of secondary data and literature
Survey
Case study
SEARCH OF SECONDARY DATA AND LITERATURE :-
The quickest and most economical way is to find possible hypotheses from
the available literature. The past researcher may be suitable sources of
information to develop new hypotheses. The researcher can search them for
his research purposes.
SURVEY:-
Survey means the survey of people who have had practical experience with
the problem to be study. These individual can be top executives, sales
manager, wholesaler and retailer processing valuable knowledge and
information about the problem environment.
CASE STUDY: -
The case study method is a technique by which individual factor weather it
be an institution or just an episode in the life of an individual or a group in
its relationship to any other in the group.
RESEARCH INSTRUMENT USED
I have used the following research instruments in my project:-
QUESTIONNAIRE: -
The term questionnaire usually refers to a self-administered process
where by the respondent himself read the question and records without
the assistance of an interviewer.
OBSERVATION METHOD: -
The observation method is useful to know the reaction of
handicapped information.
INTERVIEW: -
The interview method of collection data involves presentation of oral-
verbal stimuli and reply in terms of oral- verbal response.
SAMPLING TECHNIQUE USED
When field studies are under taken in practical life, consideration of time
cost and some other factors almost invariably lead to a selection of
respondents. The selected respondents constitute a sample and the selection
process is called sampling technique.
A sample design is definite plan determined before any data are actually
collected for obtaining a sample from a given population. Samples can be
either probability sample or non-probability sample.
I have selected simple random sampling in my project,
SIMPLE RANDOM SAMPLING
This type of sampling is also known as chance sampling or probability
sampling where each item in the population has an equal chance of being
selected in the sample.
SAMPLE SIZE
When a survey is undertaken and when it is not possible to cover the entire
population the researcher has to answer the basic question – how large
should be sample be? The sample size decision is related directly to research
cost.
The intended sample size is the number of participants planned to be
included in the trial, usually determined by using a statistical power
calculation. The achieved sample size is the number of participants enrolled,
treated, or analyzed in the study.
I have taken 50 people in my sample size, as the sample size should be
neither so small nor so large.
METHOD USED FOR DATA COLLECTION
The task of data collection begins after a research problem has been defined
and research design chalked out. While deciding about the method of data
collection to be used for the study the researcher should keep in mind two
types of data-
1. Primary data
2. Secondary data
1. PRIMARY DATA -
Those data that have been observed and recorded by the researchers for
the first time in their knowledge.
Sources;
Questionnaire
Interview method
2. SECONDARY DATA-
Those data that have been compile by some agency other than user.
Sources;
Case study
ANALYTICAL TOOLS USED The term analysis refers to the computation of certain measures along with
searching for patterns of relationship that exists among data group. Analysis
is essential for a scientific study and for ensuring that we have all relevant
data for making contemplated comparisons. Therefore, I have used
Tabulation, Graphs & Charts in my project.
ANALYSIS
1. Induction training is of sufficient duration?
(a)Yes 60% (b) no 35% (c) can’t say 05%
InterpretationAccording to the study 60 % employee are satisfy duration of training & 35% employee
are not satisfy & 5% say can’t say
2. Induction training is given adequate importance in your organization?
(a) Yes 23 (b) no 70 (c)can’t say07
InterpretationAccording to the study 23% employee are training adequate important in organization but 70% employee are not important for organization & 7% say can’t say
3. Induction training provides an excellent opportunity for newcomers to learn comprehensively about the organization?
(a)Yes 70 (b)no 28 (c)can’t say2
InterpretationAccording to the study 70% training an excellent opportunity for new employee & 28%
employee say no & 2% say can’t say
4. Senior management takes interest and spends time with the new staff during induction training?
(a)Yes20 (b)no75 (c)can’t say5
Interpretation
According to study 20% employee takes interest to spend time with the new employee but 75% are not & 5 % say can’t say
5. The new recruits find induction training very useful in your organization?
(a)yes 35 (b)no 55 (c)can’t say10
Interpretation
According to study 35% recruitment are useful for organization but 55% say no & 10 % say can’t say
6. The induction training is periodically evaluated and improved?
(a)yes 65 (b)no 25 (c)can’t say 10
InterpretationAccording to study 65% training is periodically evaluated & improved but 25 % say no % 10 % say can’t say.
7. The employees are helped to acquire technical knowledge and skills through training?
(a)yes49 (b)no 42 (c)can’t say9
InterpretationAccording to study 49% employee are help to acquire technical knowledge & skills but 42 % say no & 9 % say can’t say
8. There is adequate emphasis on developing managerial capabilities of the managerial staff through training?
(a)yes60 (b)no 35 (c)can’t say5
InterpretationAccording to study 60 % say to develop employee capabilities but 35 % say no & 5 % say can’t say.
9. Human relations competencies are adequately developed in your organization through training in human skills?
(a)yes 44 (b)no 50 (c)can’t say6
InterpretationAccording to study 44 % say human relation competencies are important for organization but 50 % say no & 6 % say can’t say
10. Training of workers is given adequate importance in your organization?
(a)yes 50 (b)no 45 (c)can’t say5
InterpretationAccording to study 50% say training of worker is given adequate important in organization but 50% say no & 5 % say can’t say
Findings
Problem which associated with the program are that many employee are not
aware to the HR policy of the organization.
Many employee have no complete knowledge about the Training & Induction
process
Many employee are not satisfied the process of the Training & Induction program
Many employee are not know the organization policy & practices
Conclusions
India, with its intrinsic advantages such as low cost, ready pool of English
speaking manpower and geographic positioning is emerging as a viable
destination for HR outsourcing companies to set up their businesses.
Till that time, HR outsourcing in India remains to be a gold mine waiting to be
unearthed...
1. Cost-benefit advantage - lower cost of outsourcing viz-a-viz
outsourced
content/processes
2. Confidentiality of processes - away from in-house leaks
3. External expertise as compared to existing in-house expertise
4. Time advantage - timely process completion commitments and
easier
time-to-market processes/products/services.
5. Focus internally on innovative/creative/strategic work and to do
away
with in-house with mundane, time consuming processes
6. Greater objectivity/credibility gain amongst employees
7. Confidence of top management on external professionalism and
proven expertise
8. Strategic intent of doing away with high, permanent salary/pay loads
9. Client preference, especially overseas clients
10.Branding/credibility enhancement by associating globally renowned
outsourcing Companies
11.Keep organizational headcount and reporting structure flat and
flexible.
Suggestions
If employee are clear knowledge about their practice & policy they are development of fair relationship between employee ,employer & management
To development skills of their employee
They provide full information about their work
To improvement their Training & Induction process
To develop good relationship between new employee & old employee
Internal & external employee support the Training & Induction process
Each level of employee should be formally inducted and introduced to the
Departmental Head. If not all levels, at least Asst. Manager and above category of
employees.
External source should be given equal importance with internal source. By which
New brain the in company with skill, talent, efficiency etc.
BIBLIOGRAPHY
DESIGNING AND MANAGING HUMAN RESOURCE SYSTEM
……….Udai Parek & T.V.Rao
PERSONNEL MANAGEMENT
………..C. B. MAMORIA
Audit report of M&M
outsoursing magazine of HR exposoure
INTERNET
Questionnaire
1. Induction training is of sufficient duration?
(a)Yes 60% (b) no 35% (c) can’t say 05%
2. Induction training is given adequate importance in your organization?
(a) Yes 23 (b) no 70 (c)can’t say07
3. Induction training provides an excellent opportunity for newcomers to learn comprehensively about the organization?
(a)Yes 70 (b)no 28 (c)can’t say2
4. Senior management takes interest and spends time with the new staff during induction training?
(a)Yes20 (b)no75 (c)can’t say5
5. The new recruits find induction training very useful in your organization?
(a)yes 35 (b)no 55 (c)can’t say10
6. The induction training is periodically evaluated and improved?
(a)yes 65 (b)no 25 (c)can’t say 10
7. The employees are helped to acquire technical knowledge and skills through training?
(a)yes49 (b)no 42 (c)can’t say9
8. There is adequate emphasis on developing managerial capabilities of the managerial staff through training?
(a)yes60 (b)no 35 (c)can’t say5
9. Human relations competencies are adequately developed in your organization through training in human skills?
(a)yes 44 (b)no 50 (c)can’t say6
10. Training of workers is given adequate importance in your organization?
(a)yes 50 (b)no 45 (c)can’t say5