Strategic Human Resource Management

BY G.Shashank Joseph Vijay Kumar.

The performance by outside parties, on a recurring basis, of tasks that would otherwise be performed in-house.

In-sourcing Off-shoring Co-sourcing Geo-sourcing Outplacement

Onshore outsourcing outsourced work is performed locally (i.e. in the same country). Near-shore outsourcing outsourced work is performed in other countries that are in approximately same time zone (i.e. Mexico or Canada).

Offshore outsourcing outsourced work is performed in countries with different time zones (i.e. India, China, Singapore)

Many firms simultaneously position themselves as offering consulting and outsourcing services. Consultants advise us on how to do something. Outsourcing providers actually do it.
Sometimes a consultant will deliver a business service or product, and that's when they are acting like a provider, and an outsourcing provider will advise

Outsourcing relationships are high value-add, durable and on goingthey are not a one-time only deal. Outsourcing relationships are high level, contractual relationships for a fixed period of time, usually measured in years, but they are assumed to be continuous. As managerial understanding of outsourcing's values proposition advances then the number of applications for outsourcing multiply.

Companies should outsource only their noncore activities that are not central to the business repeatable and automated tasks. Examples include IT support, HR (payroll, recruiting, benefits administration, training and development), logistics, administration, customer services, finance services, supply chain management

Traditional role - Reaction to problem

Reduction and control of costs Avoid large capital investment costs Insufficient resources available

Modern role Business Strategy

Allows company to focus on their core competencies Keeping up with cutting-edge technology Creating value for the organization and its customers Building partnerships

Improve Business Focus.

Gain Access to World-Class Capabilities. Accelerate Reengineering Benefits.

Share Risks.
Redirect resources to more Strategic Activities.

One time applications.

Reduce or Control Operating Costs. Make Capital Funds Available.

Generate a Cash Infusion.

Secure Resources not available internally.

Third generation outsourcing. 1st stage was about doing the work with the existing rules, 2nd stage is to redefine. The 3rd stage is to redefine the business. Its not about creating dependence, it's about actively creating interdependencies that serve the interests of all parties. Used to radically change the definition of the businessopen new markets, deliver new customers, and create new products.

PricewaterhouseCoopers Model
Strategic Non-Strategic

Competitive

Not Outsourced

Grey Area

Non-Competitive

In House if Possible

Outsource

Lower labor and operational costs. Increased productivity (20 25 %)/high efficacy Focus on core business competencies . World-class technology at lower prices. Reduced investments in equipment or infrastructure. Possibility to quickly increase/decrease workforce to reflect peaks and valleys in production demand. Competitive advantage . Establishment in the new markets .

A possible lose of managerial control. Threat of security and confidentiality . A possible lose of flexibility in changing business conditions. Quality problems/on-time result delivery . Hidden costs (governmental issues, terrorism, currency fluctuations, contract issues, cultural differences).

 Relocation Recruiting/Staffing Competence Development Salary Administration Consulting and Training

HR Information Systems Disciplinary Issues HR Surveys HR Research Staff Loans and Perks Manpower and Career Planning