Towards Successful Outsourcing of Human Resource Functions

Abstract

Organizations respond to challenges and demands for greater performance with various programmes designed to overcome obstacles and enhance business performance. One of such responses is outsourcing and it can be highly controversial. This article outlines some of the attractions and challenges of outsourcing human resource functions to give a realistic view of what can be achieved through outsourcing. The effects of outsourcing are contingent on factors like focus on core competencies; make or buy decision, clarity about outsourcing needs, gaining full support and cooperation from employees, training courses and seminar sessions.

Facilitators of the effective outsourcing include explicit goals and expectations, identifying clear objectives and expectations of outsourcing , good choice of outsourcing partners, rebuilding trust among workers, acquiring the right people with the right skills in outsourcing, adequate supporting infrastructures, commitment by top management,  development of objective performance criteria , adequate performance feedback, emphasis on both short and long-term benefits, anticipation of change and flexibility. Despite its limitations and difficulties, outsourcing increases profit levels, market share and customer satisfaction but must be carefully handled, so as to not allow diminishing returns to set in.