Global HR Outsourcing Industry - Procurement Market Intelligence Report

HR Outsourcing Industry: Category Spend Analysis

The global HR outsourcing industry is expected to witness category spend growth of USD 106 billion between 2016-2021, with spend momentum accelerating at a CAGR of 12.28% during the forecast period. This increasing spend will be primarily attributed to the functionalities of HR service providers who leverage their technical infrastructure to provide services in a cost-effective manner. Outsourcing these functions allows buyers to focus on their core competencies while reducing their operational cost. HR service providers are well-versed with regional regulations which ensures buyer’s absolute adherence to the prevailing regulations and stay immune from any risks associated with non-compliance of these regulations.

Prevalence of stringent labor laws and the existence of organizations with multi-country payroll are driving buyers to outsource these functions to HR service providers to ensure compliance and to streamline the payroll processes. This is driving the spend growth in North America who is currently holding the highest share in the global HR outsourcing industry. Shortage of skilled professionals is driving buyers in APAC to outsource the RPO functions to HR recruitment firms. They leverage their established recruitment networks to reach a large number of candidates. Also, their expertise in screening candidates helps organizations to select the best available talent for their organizations.

For additional HR outsourcing category spend insights, download a free sample report.

Insights Offered in this HR Outsourcing Market Report

Written from the perspective of the buyers and suppliers, this procurement intelligence report offers comprehensive coverage of the factors driving spend across various regions and helps buyers to identify opportunities for cost savings. To help buyers procure HR outsourcing at cost-effective rates, an analysis of the pricing outlook and supplier cost structure is also offered in this report.

Insights offered in this HR outsourcing market report will help the buyers understand:

• Global and regional spend potential for the period of 2016-2021
• Top HR outsourcing suppliers and their cost structure
• US market supply scenario
• HR outsourcing market prices, price trends, and forecasts
• Incumbent supplier evaluation metrics

HR Outsourcing Industry Pricing Trends

This HR outsourcing industry procurement market intelligence report contains in-depth pricing insights to aid the procurement process. These pricing insights provide an overview and comparison of pricing models, supply chain margins, and the volume and cost drivers impacting pricing:

• Adoption of technological platforms, such as cloud systems, and periodic technological upgrades will result in a sharp increase in the cost of services incurred by HR outsourcing service providers. Such an increasing expenditure will compel them to hike the charges of their services.
• Suppliers are incurring an increasing expenditure on salaries to retain the existing employees with niche skill sets to deliver services like HR analytics consulting, payroll process, and compliance that requires in-depth understanding of various HR labor laws.
• Sales and market expense, loss on sale/purchase of property, plant, and equipment, and administrative expenses are expected to increase owing to the rise in cost incurred in sales and administrative expense.

For additional HR outsourcing market price insights, download a free sample report now.

HR Outsourcing Industry: Category Spend Optimization

This HR outsourcing procurement research report advises buyers to engage with HR service providers that offer a high level of technology adoption and innovation. Rapid advances in technologies such as the use of cloud-based HR management applications, IT advancements, and data analytics, are creating huge opportunities for organizations to optimize and increase the efficiency of their HR functions. Some of the technological capabilities that buyers of HR services should focus on while selecting service providers are data analytics capabilities for analyzing HR data and cloud-based software applications that help to remove manual management of HR activities such as payroll processing, among others.

This HR outsourcing industry procurement market intelligence report also offers coverage of:

• Total cost of ownership
• Supply chain margins and outlook for input costs
• Overview and comparison of pricing models

HR Outsourcing Industry – Procurement Challenges

Loss of control over the outsourcing function is a major procurement challenge faced by category managers while outsourcing their HR activities. Even if HR activities are outsourced, buyers will be responsible for all legal compliance and will be solely responsible for any legal compliance failure by service providers. Buyers find it extremely difficult to coordinate and control the activities of suppliers due to factors such as communication failure between them. Also, the lack of understanding about buyers’ HR requirement and organizational structure by suppliers create problems with respect to coordination between them.

Key Features of Report

Supply Market Insights	Procurement Best Practices
Cost Saving Opportunities	Pricing Models
Negotiation Strategies	Category Risk Analysis
Key Supplier Analysis	Supplier Capability Matrix

HR Outsourcing - Category Spend Analysis

According to this market intelligence report, one of the key growth contributors to the global market of HR outsourcing is the constantly growing need among organizations to reduce their operational cost and increase efficiency to counter rising competition. Outsourcing of HR services helps firms to reduce operating cost as the expenses of outsourcing is relatively less compared with maintaining inhouse capabilities. This is because cost components such as expenses related to recruitment and training, maintenance of HR and payroll software, office rents, and time/cost spent developing and improving internal processes, and managing the in-house team will get eliminated partially or fully.

HR Outsourcing - Procurement Best Practices

This HR outsourcing procurement research report advises buyers to engage with HR service providers that offer high level of technical adoption and innovation. Rapid advances in technologies such as the use of cloud-based HR management applications, IT advancements, and data analytics, are creating huge opportunities for organizations to optimize and increase the efficiency of their HR functions. Some of the technological capabilities that buyers of HR services should focus on while selecting service providers are data analytics capabilities for analyzing HR data and cloud-based software applications that help to remove manual management of HR activities such as payroll processing, among others.

HR Outsourcing - Procurement Challenges

Loss of control over the outsourcing function is a major procurement challenge faced by category managers while outsourcing their HR activities. Even if HR activities are outsourced, buyers will be responsible for all legal compliance and will be solely responsible for any legal compliance failure by service providers. Buyers find it extremely difficult to coordinate and control the activities of suppliers due to factors such as communication failure between them. Also, the lack of understanding about buyers’ HR requirement and organizational structure by suppliers create problems with respect to coordination between them.