...Outsourcing Human Resources Management Functions: Recruitment and Selection Uni*********** Research Paper for HRM**** Section 1202 ********** March 16, 2012 Outsourcing Human Resources Management Functions: Recruitment and Selection Introduction In the recent past, the competitive environment for many organizations has changed, with the organizations having to operate in globally capitalized environments, rapid industrialization, and changing technology (Abraham, 1988); and just recently a global economic downturn which has had organizations to downsize their operations. As a result, these organizations are constantly seeking new managerial methods, as both a way for the organization to be competitive and to cut operating cost; the most successful method is the outsourcing of business processes. Normally the Human Resources Management (HRM) function of recruitment has traditionally been performed in-house; advocates for outsourcing this function have increased and argue that outsourcing can reduce costs associated with recruitment and selection (Klass, 2001). Some organizations delegate crucial human resource functions to outside firms as a means of utilizing available expertise, reducing expenses, and to be able to concentrate on important business activities (Abraham and Taylor, 1996). The influence of increasing levels of globalization, technological changes, the complexity of business...
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...Discuss the Need for Outsourcing the Internal Audit Function in A Company Traditional internal audit function is defined as an independent appraisal activity to review internal control activities in companies. Dezoort (2001) implies that with the extension of business activities, the internal audit function has evolved from the traditional supervision to value adding which includes a wider scale of audit-related work so as to maximize the value of a business company. This focus on adding value to the corporation through a variety of internal audit services has raised concerns about the ability of in-house auditors to perform the wider-scale audit function in a more professional and cost-saving manner (Chapman and Anderson, 2002). Due to fierce market competitions and overcapacities, company managements set out to downsize company staff and put the focus on its profit-producing business, tending to outsource (referred to the practice that one accounting firm provides audit-related services for a business organization) internal audit function to engage external specialists to present a highly cost-saving and professional performance. Although some evidence suggests that there are many limitations of outsourced activities, this essay asserts that outsourced internal audit function plays an essential role in the development process of a corporation and there is a need to outsource that function. In consequence, these positive effects on companies will be described principally...
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...Mapping the outsourcing landscape Jakki J. Mohr, Sanjit Sengupta and Stanley F. Slater Jakki J. Mohr is the Jeff and Martha Hamilton Distinguished Faculty Fellow, Regents Professor of Marketing, at the School of Business Administration, University of Montana, Missoula, Montana, USA. Sanjit Sengupta is Professor of Marketing at the College of Business, San Francisco State University, San Francisco, California, USA. Stanley F. Slater, is the Charles and Gwen Lillis Professor of Business Administration in the Department of Marketing, College of Business, Colorado State University, Fort Collins, Colorado, USA. The authors thank Professor Ron Premuroso for his helpful contributions to this manuscript. PAGE 42 j utsourcing is an arrangement in which one company (the client) hires another company (the service provider) to perform a particular function on its behalf. It involves the transfer of the management and/or day-to-day execution of an entire business function to an external service provider. Based on a contractual agreement that defines the transferred services and fees, the client agrees to procure the services from the supplier for the term of the contract. Outsourcing has become more global and extensive in its scope, involving more business functions and complex contractual arrangements (Tadelis, 2007). As customer needs have evolved, so have service providers’ desire to ‘‘move up the value chain’’ and claim a larger share of...
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...Outsourcing the IT Function of an Organization Frank Bicocchi CMGT/578 12/15/2014 DENNIS FINIGAN Outsourcing the IT Function of an Organization Strategic analyst and business analyst in the organizations of today have uphill battles. Often miss understood or limited by the executives of an organization, these positions function as the go-betweens for internal operations, clients and stakeholders. Managers also have the duty of handing similar aspects in terms of managing teams, ensuring project profitability and improving process efficiencies. Enter outsourcing; a solution that helps managers and analysts maintain standards while provide the most ‘bang’ for the ‘buck.’ Information systems and information technology are the latest functions to see large segments become outsourced to third parties as a means to an end. Outsourcing is not a new trend. In most businesses some percentage of each department is outsourced in some way. For instance, 94% of the businesses surveyed by HR Magazine outsource some aspect of their organizations’ human resource functions to be handled by one or more third parties; in most cases it is more than 60% of the given function (Gurchiek, 2005). Strategic planners use outsourcing as a tool to help organizations meet their goals while maintaining financial leanness and low cost/benefit ratios. In the information technology environment, outsourcing has increased primarily due to the sheer number of specialties involve in the field as a...
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...document.] | Contents 1. Definition of outsourcing 3 2. Functions outsourced by HR 3 3. Advantages of outsourcing HR Functions 4 3.1 Managing and minimising risk 5 3.2 Cost Savings 5 3.3 Efficiency and economies of scale 5 3.4 Professional Expertise 5 3.5 Improved Employee Morale 6 4. Disadvantage 6 4.1 Poor Performance and decline in quality 6 4.2 Distance and lowering moral 6 4.3 Recruitment Problems 6 4.4 Leak of important internal information 6 4.5 Perceived loss of power and control 7 4.6 Increased Direct Costs 7 5. e-HRM 7 5.1 Objective of e-HRM 7 5.2 Advantages of e-HRM 8 5.3 Disadvantages of e-HRM 8 6. Conclusion and Advice to the Client 8 1. Definition of outsourcing The Human Resource department is considered to be one of the highly accredited departments of the organization; these are the people who provide the working resource to the company and keeping the company afloat even in the worst economic downtime. The best way in which the HR can be managed is decided by the HRD. The ways in which the human resource management is done has changed considerably in the recent years. The HR activities and functions can now be delivered, not only by the specialised Human Resource professionals, but also through outsourcing (Ulrich 1996; Tremblay, Party and Lanoi 2008). The HR outsourcing can be defined as the purchasing of the HR functions and services from a third party supplier. HR outsourcing can also be defined as the process of...
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...Pros and Cons of Outsourcing Outsourcing is the practice of having certain job functions done outside a company instead of having an in-house department or employee handle them. Functions can be outsourced to either a company or an individual. In other words it is the process of assigning a company’s business processes to an external agency in lieu of enhancing service quality, driving innovation or deriving benefits of lower labor costs. Outsourcing has become a major trend in human resources over the past decade.More and more companies, large or small are turning to outsourcing as a way to grow while restraining payroll and overhead costs. The effects of outsourcing are subjective to the industry and the purpose for which the same was undertaken. However across industries outsourcing is primarily undertaken to enable companies to generate better revenue recognition and to provide them an added competitive differentiation. While done with the best of intentions, outsourcing has a telling effect on quality of products and services delivered as a consequence of this, either enhancing or lowering quality. While there could either be an increase or decrease in the turnaround time while outsourcing, it could also result in improved or decried customer service. Outsourcing, primarily undertaken to provide companies the competitive edge, can also result in easier management and better productivity based on how effectively the process in managed. Outsourcing is often undertaken...
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...Outsourcing of outsourcing the IT function Introduction Outsourcing is contracting with another company or person to do a particular function, (Schaffhauser, 2005). Outsourcing of almost every department of a business is a real option for all businesses. In today’s world of business, most companies have an IT department; however, management may consider the option to outsource the IT function for various reasons to include increasing the bottomline. This paper will address the reasons to outsource in addition to the risks and rewards. Determining Factors in the Decision The first question that management must address is “Why outsource?” Outsourcing enables companies to reduce and control operating costs by eliminating costs related to talent acquisition. When a company hires an employee, they usually provide a benefit package that includes health insurance and vacation time. In addition, companies are responsible for for training, employment taxes and other related costs. And by outsourcing non-core business functions, more capital funds are freed up to spend on items that are directly related to its product or service. Outsourcing also enables companies to gain superior talent. Instead of just the knowledge of one person, the company would benefit from the combined experience of a team of IT professionals. Outsourced IT companies usually require their IT staff to have proper industry training and certifications as well. The cost of keeping up with technology is another...
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...ABSTRACT While outsourcing internal audit function in the private sector has been extensively Investigated by various researchers (Carey and Chua, 1999; Petravick, 1997; and Sharma and Subramaniam, 200l; amongst others), there is scant empirical data from the public sector. This study attempts to fill the gap by providing some preliminary evidence in food and beverages industry. Using responses from 3 firms which includes Dangote flour mills, UAC and Northern Nigeria flour mills plc, the study found that more than 85% of the respondents had either fully outsourced or co-sourced their internal audit function. Further, non-department entities were found to more likely to fully outsource their internal audit function than the departments. Lack of technological know-how and service quality of external providers seem to outrank cost-related factors as reasons for outsourcing. The study also raises several issues in relation to a lack of segregation of duties in the process of selecting and monitoring outsourced arrangements. Implications for policy setting and avenues for future research avenues are discussed. INTODUCTION In today’s business environment, outsourcing processes to a third party has become relatively commonplace. The practice gives organizations an opportunity to gain efficiencies, improve performance, lower costs, and focus on core competencies. Many businesses, however, fail to complete necessary due diligence work before the outsourcing relationship begins and neglect...
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...Running head: FACTS ABOUT OUTSOURCING 1 The Facts about Outsourcing Lawrence Smith Professor Barron Columbia College FACTS ABOUT OUTSOURCING 2 Abstract Globally, businesses have undergone unprecedented changes because of technology, the internet, and improved educational systems around the world. There are so many moving parts to having a successful business; nowadays, many organizations are outsourcing their non-core activities to external agents. Outsourcing is becoming an increasingly accepted practice for both small and large businesses of today. Outsourcing has quietly grown into a standard operating procedure for many organizations. This rising use of outsourcing represents a paradigm shift in the way companies conduct business. In today’s business environment, every company is looking for ways to reduce costs. Many are now turning to outsourcing as a weapon in their cost-cutting arsenal. But outsourcing is about more than shrinking budgets and reducing headcount. This paper will explain the term outsourcing and address why organizations prefer to outsource some of its functions in today’s business environment. Also, discussed in this paper will be the advantages and disadvantages of the outsourcing process and its rewards and risks towards the organization. FACTS ABOUT OUTSOURCING 3 The Facts about Outsourcing The word outsourcing could be described as the contractual relationship with a specialized outside service provider...
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...IP 2 Tonja A. Brooks AIU Online Abstract This paper attempts to develop a framework for interrelationships among human resources information systems (HRIS), outsourcing, and corporate culture. This research investigates impacts of outsourcing HRIS on corporate culture. In this paper, we hypothesize that Outsourcing corporate HRIS is less desirable (1) if the quality of product and customer service matters for a firm, (2) if an organization is concerned with a loss of intellectual property, and (3) if an organization requires maintenance of a distinctive, human resource utility activity that is capable of meeting the challenges of fast changing customer demands in a dynamic business environment. In addition, this paper argues companies must be aware of the total costs associated with HRIS before outsourcing its human resource functions. Finally, the impact on employee morale and implementation must also be considered. By outsourcing HRIS, managers will be able to spend more time and resources dedicated to an employee’s professional career development. Business Research for Decision Making – IP 2 Introduction There has been a tremendous amount of research and studies done on corporate culture, outsourcing, and HRIS; however, there have been only menial research and studies done on Outsourcing HRIS and the sense that it has on the corporate culture. Hagood and Friedman [9] argue that the need for an organization to measuring the performance of the HRIS in order...
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...REPORT ON OUTSOURCING Executive Summary Out sourcing can be defined as taking services of third party in order to get the solution or task done on time without hiring employees permanently in an organization. This paper is based on a case named “report on outsourcing”. In this case a manger wants to get an advice regarding the future of outsourcing in an organization. As per the current trend in the industry, outsourcing is the best way to get work professionally from experts all over the world. E-HRM is the term that defines “outsourcing HR” more technically. This paper includes academic journal articles and other literary sources; in addition company analysis examples are also included in this task. The issues discussed in particular are the evaluation of HRM factions in terms of outsourcing. Table of Contents Executive Summary 1 Introduction 3 Discussion 4 Concept of Our Sourcing 4 HR Fuctions Generally Outsourced 5 Recruitment 5 Training 5 Learning 6 Advantages and Disadvantages of HR Outsourcing 7 Advantages of Outsourcing HR 7 Disadvantages of Outsourcing HR 9 E-HRM 10 Role of E-HRM in Outsourcing HRM Function 11 Advice to the Client 13 Case Scenario Summary 13 Advice 13 Conclusion 16 References 18 Report on Outsourcing Introduction The Intelligent outsourcing is the use of contracted resources, assets and capabilities of a third party, guaranteed quality criteria, performance and value levels against the cost, as well...
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...Outsourcing Written by yaqoob Al-bulushi Thursday, 01 October 2009 08:06 - Last Updated Friday, 02 October 2009 19:31 The decision to proceed with outsourcing comes from strategic managements. Companies use strategic management to define set of decisions and action that result in the formulation and implementation of plans designed to achieve company’s objectives. One of the decisions can be outsourcing. The company has to go through different tasks to determine factors that will lead to a decision to proceed with outsourcing. It starts by formulating company’s vision, mission and value statement. Conduct environmental analysis that reflects the company’s internal and external conditions and capabilities. Analyze the Company’s options by matching resources with the external environment. Identify the most desirable options by evaluating each option in light of the company’s mission. Select a set of long-term objectives and grand strategies that will achieve the most desirable options. Develop annual objectives and short-term strategies that are compatible with the selected set of long-term objectives and grand strategies. Implement the strategic choices by means of budgeted resource allocations in which the matching of tasks, people, structures and technologies. If company finds out after analyzing its environment, it is looking at cutting operating costs of support functions, it needs to focus on its core business, its needs to reduce capital expenditure ...
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...Emerging Trends: Outsourcing Outsourcing or subcontracting is a process where employers handover routine or peripheral work to outside organizations that specialize and execute functions more efficiently. Outsourcing has advantages and disadvantages. Outsourcing nonessential functions can be cost effective and improve the quality of services. Outsourcing agreements create long-term relationships through contracts between employers and subcontractors by flexible renewable contracts. When companies outsource, they send a small number of permanent employees to oversee a shifting workforce of possible employees. The trend of outsourcing human resources functions such as payroll, training, and recruiting are more common. Human resource outsourcing is an $80 billion industry with a projected growth rate of 33percent. Although outsourcing payroll activities is efficient, there are some downsides to outsourcing human resource functions of training and performance evaluations. Outsourcing Advantages Outsourcing companies provide a better-quality of people who are on the up and up with current human resource practices that pertain to specific human resource tasks and activities. The core mission of outsourcing firms is to specialize in a particular function while providing exceptional services and increasing efficiency. For example, a firm specializing in training employees to use work processing software is likely to train employees when new software upgrades are launched with...
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...be an Inside Job? A Study on the of Outsourcing Human Resources Departments Prepared by Nneka A. Gunn Report Distributed July 21, 2011 Prepared for Dr. Mike Chase Managing Human Resources MBA BUSM 533 – Group 13 This is to certify that this paper was constructed and written solely by Nneka Gunn INTRODUCTION In a world that is filled with financial turmoil and economic upheaval, companies are looking for ways to cut costs at every turn in order to maximize profits. This research paper will delve into the world of outsourcing. One may ask, “What is outsourcing?” Outsourcing in business is when an organization contracts or hires another company to perform duties and tasks or provide a service that is normally performed in-house, which offers access to skilled expertise, a manageable and variable cost structure, and opportunities for increased focus on an organizations’ core business. The idea of outsourcing is traced to have originated in the 1960s with the Electronic Data System. The history of outsourcing as a strategy shows that it developed from a need for specialized, lower cost labor; which makes outsourcing a great fit for small businesses that are often short of labor, and need low costs. Businesses can keep control of the training function, but gain a strategic partner that can address key needs at a reasonable cost. Human Resources (HR) is the fastest growing segment of the business process outsourcing sector. HR is heavily weighted with...
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...The Outsourcing Advantage Abstract Outsourcing has become a well-integrated function in the world of business today. Outsourcing forgoes attempts to perform certain value chain activities internally and instead, farms them out to outside specialists and strategic allies (Gamble & Thompson, pg. 127). An affordable and often more efficient way to meet a goal or perform a task is to have it outsourced. There are many reasons to outsource a task or function. Each reason varies, depending on the nature of the task, the firm’s available resources and the desired outcome. Outsourcing also stimulates the economy, providing a means to support local businesses while simultaneously keeping the organization’s resources aligned internally. There are risks associated with outsourcing as well. One must maintain a localized and unified vision, with the firm’s best interest in mind, before deciding to outsource a job and also for the duration of the contract. In the world of business today, everyone is looking for the competitive advantage. Organization’s need to streamline their business practices in order to maximize profit margins and reach sustainability. One way to do this is to outsource. Outsourcing is simply the function of taking internal resources, and giving them to outside firms who then make those work operations their sole responsibility (driveyoursuccess.com). More and more companies seem to be outsourcing their services. A recent study by BlueWolf revealed that 35%...
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