Not a Member? Get access to HR news and resources that you can trust.
Standing desks and other innovative workstations can help counterbalance the negative health effects of sitting.
Is your employee handbook ready for the New Year? With SHRM’s Employee Handbook Builder get peace of mind that your handbook is up-to-date.
Get the HR education you need without travel expenses or time out of the office.
Elevate Your Talent Strategy. Join us in Chicago, IL – April 24-26, 2017.
Selective Benefit Outsourcing
Larger U.S. employers continue to take a selective approach to outsourcing their benefits administration, recruiting, payroll, and other HR functions rather than relying exclusively on a single provider, according to research by consultancy Watson Wyatt.
“Over the last few years, we’ve continued to see tremendous growth in selective outsourcing,” says Richard Hubbard, director of Watson Wyatt’s U.S. technology and administration solutions practice. “The economic strains some companies are facing will only add to the reasons to choose selective outsourcing. Selective outsourcing provides employers a lot of flexibility and helps them keep their options open.”
Selective outsourcing is popular because "it can be tailored to meet an organization’s exact needs,” Hubbard says. For most organizations, this means outsourcing routine, transaction-oriented processes while refocusing the HR department on strategic planning. "Many companies report that selective outsourcing best meets their needs for access to leading-edge technologies, while improving employee experience and service levels," he adds.
"The key to successful outsourcing is finding the solutions that fit the organization’s needs and culture,” Hubbard notes.
Changing Strategies in HR Technology and Outsourcing survey of 182 U.S. companies found that many expect to do more outsourcing in the future, in areas such as health and welfare programs.
HR Functions Outsourced Now or Likely to be Outsourced in Near Future
Plan To Bbe Outsourced This Year or Next
Define contribution retirement plans
Health and welfare plans
Defined benefit retirement plans
Source: Watson Wyatt
However, few companies (21 percent) automatically direct their HR function to outsource programs. The majority (63 percent) look to use their internal or enterprise resource planning (ERP) systems whenever possible to deliver HR services.
Among other key findings in Watson Wyatt's research:
The technology research firm CedarCrestone also found growth in selective outsourcing. In its
2007/2008 HR Systems Survey, the firm found that selective outsourcing is preferred to total business process outsourcing in most HR categories. The firm forecasts that selective outsourcing will continue to grow in 2008, particularly as small and medium-sized organizations adopt the strategy.
Stephen Miller is manage/editor for SHRM Online.
You have successfully saved this page as a bookmark.
Please confirm that you want to proceed with deleting bookmark.
You have successfully removed bookmark.
Please log in as a SHRM member before saving bookmarks.
Your session has expired. Please log in again before saving bookmarks.
Please purchase a SHRM membership before saving bookmarks.
An error has occurred
Recommended for you
CA Resources at Your Fingertips
SHRM’s HR Vendor Directory contains over 3,200 companies