SBPOA, Personal Magazin, Survey, HR BPO, Germany
SBPOA and Personal Magazin publish results of landmark study
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With signs that the German market for outsourcing is growing significantly – recent reports indicate its share of the European outsourcing market jumped to 12.5 percent from less than one percent four years ago – the Shared and Business Process Outsourcing Association (SBPOA) and PERSONAL magazin recently completed a study on the capabilities of HR Business Process Outsourcing (BPO) service providers in Germany.
39 Germany-based HR BPO providers that serve the German market participated in the study, the results of which are published in the May issue of PERSONAL magazin. The story on the study results is accessible by going to: http://www.personal-magazin.de/SID109.P0zC20KExDk/newsDetails?newsID=1114684225.57. An English language analysis of the study results will soon be available on the SBPOA web site: www.sharedxpertise.org.Key areas covered in the study include:
*What HR BPO processes the service providers offer to clients
*What software platforms are utilized by the service providers
*What methods the service providers use to exchange data with their clients
*How the service providers educate their clients on newly-supported HR processes
*What their clients’ average cost savings are as a result of outsourcing
*What success measurements/metrics are utilized (e.g., service level agreements, key performance indicators, etc.)
*What they believe are clients’ primary criteria for selecting one service provider over another
One of the most interesting findings from the study is that cost savings falls far below quality of services delivered as a driver for service provider selection. In fact, 59 percent of the service providers participating in the study cited “quality” as the number one criteria, while only 17 percent cited cost efficiency and savings.
Said Andrew Kris, Chairman of the Advisory Board to the SBPOA, “Economic conditions are causing significant challenges for German companies trying to compete in the global marketplace. Thus, the transfer of non-core HR processes to a third-party is increasing as a component of German companies’ strategic business model. The results of this study will help German companies better understand the capabilities of HR BPO service providers, and assist them in making the right service provider choice for their own unique needs.”
The study revealed that 95 percent of the German HR BPO providers deliver payroll services, while more strategic functions, such as personnel development or the definition of HR strategies, are offered by far fewer providers. The study further found that HR BPO contracts in Germany – as in other world regions – are long-term partnerships (ranging from four-to-five years all the way up to 10 years), especially because a growing number of providers with a historical focus on payroll services are extending their portfolio to offer additional services such as pensions/benefits administration, employee communications, and HR information systems.
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