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first_imgRelated posts:No related photos. Audit personnel before you cast it outOn 17 Jul 2001 in Personnel Today Comments are closed. Previous Article Next Article The outsourcing of “non-core” activities continues unabated.Although it is difficult to argue sensibly that the HR activities of anorganisation are anything other than central to its success, personnel is afrequent candidate for outsourcing. The stance we have taken in our benchmarking and strategic HR advisory workhas been neutral when debating the pros and cons surrounding outsourcing in thefunction. However, the lessons learned by several who have raced down theexternalisation route have been salutary. At the very least, it pays to look at the medium- to longer-termimplications when considering a matter of such strategic importance. – How difficult will it be to reinstate any aspect in-house in the future? – Will it be possible to have anything approaching a fair and open tenderingprocess when the current contract expires and activity is checked for”value for money” in the future? – Or will existing suppliers have well and truly cornered your market and beable (whether in your perception or actually) to hold you to ransom? Decisions on these and at least another 20 questions of long-term viabilityand value should be addressed before considering the potential of outsourcing.Before getting to the stage of even considering such important change, though,there is a lot of sense in finding out in some detail what is currently beingdone, by who and at what cost and comparing the value and effectiveness ofdelivery with other HR departments to assess the relative strength of what alreadyexists in your organisation. Only by approaching the potential for outsourcing in this analytical andbenchmarked way can you begin to establish what is worth outsourcing, andwhether you are likely to obtain value for money from the service provider selectedto run the function. A relatively complex manufacturing organisation recently pursued anidentical analytical process – and went a stage further – conducting an auditof HR service effectiveness. The approach adopted asked customers (largelymiddle/senior management and professionals) how they rated the current level ofservice across recruitment, health and safety, employee support, training,appraisal and pay. It then asked whether they preferred the status quo, a moredevolved approach giving them more direct responsibility for dealing withday-to-day people issues, or a more substantial external sourcing of HRservices. The results came as a surprise. First, the current HR service was quite highly regarded and, second, theline managers in particular were quite keen to take on more detailed personnelactivities for their own areas – just so long as there was professional supportand the administration was not dumped on them. They envisaged that this supportshould come largely from internal specialist expertise but acknowledgingweaknesses in the areas of training, development and remuneration, theysuggested a degree of outsourcing in these areas. It appears that these preferences will be met with a three-way balance ofHR/line manager/outsourced specialist to provide a more acceptable andcost-effective HR solution, rather than the wholesale abrogation of”people” responsibility to external providers. There must be a lessonhere that it is worth conducting quite detailed structured research beforeembarking on potentially irreversible change.By Derek Burn Partner, MCG Consulting Group [email protected]last_img read more

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