Introduction

Significant variation exists in the adoption of Human Resources Outsourcing (HRO) across North America, Europe, and Asia Pacific.  The differences in regional market trends and risks necessitate modifications to both buyer and supplier approaches to HRO.  This report examines today’s global HRO landscape – differences in adoption rates, market trends across geographies, barriers to entry, and key risks.  It provides insights, detailed analyses and implications for stakeholders.  This report will assist companies considering outsourcing of human resources to a third-party understand both the evolution of the HRO market and how to evaluate risks and trade-offs for services across the globe. 

Scope                    

• All human resources outsourcing contracts through 2006 with a minimum of three HR functions and servicing more than 3,000 employees
• Global focus: North America, Europe, Asia Pacific
• All industries
  

Contents

This report summarizes key market trends across three geographies to assist management in making more informed business decisions: North America, Europe, and Asia Pacific.  Key Insights within each region are divided into four categories: Market overview and trends, Key buyer segments, Transaction characteristics, and Supplier landscape. Each category is discussed in detail (and illustrated with supporting data and analysis) to provide the reader information in easy-to-apply, bite-size pieces. For example, North America offers the following insights, among others:

• Market overview and trends:
  • Leading geography in terms of adoption
  • Supply-side constraints and buyers’ cautious approach have led to slightly slower adoption in 2006
• Key buyer segments:
  • Both market segments (3K-15K employees and >15K employees) offer similar revenue potential
  • Manufacturing and financial services verticals are the leading adopters
• Transaction characteristics:
  • HRO transactions are centered around payroll and benefits
  • Average price point has declined significantly
  • SAP and PeopleSoft are the market leaders in terms of TCV
• Supplier landscape:
  • Hewitt, Convergys, and IBM are the leading suppliers