Get more from your HR and IT outsourcing

In a downward economy IT outsourcing and HR outsourcing projects can help organisations achieve quick wins and improved functions and facilities. By working...

In a downward economy IT outsourcing and HR outsourcing projects can help organisations achieve quick wins and improved functions and facilities. By working more closely together they can achieve even more, writes Synco Jonkeren, senior consultant at EquaTerra.

Despite the importance of IT in the overall success of HR outsourcing projects, sadly the IT folks are not always the most sought after of advisors.

Whether this is because they are perceived to be too disjointed from the business, or whether there is an idea that the IT group will do its own "technology-driven" thing rather than implement the "customer-driven" business preference from the HR group, it is a disturbing fact that the two most important stakeholders of a sourcing project do not combine and leverage their knowledge nearly often enough.

That said, HR outsourcing and IT outsourcing are fundamentally different and I am not recommending that IT outsourcing projects slavishly emulate HR outsourcing practices. Nor am I suggesting that the HR outsourcing market is somehow more mature than the IT outsourcing one, and therefore in a position to press unsolicited advice on its counterpart.

For instance, HR outsourcing always affects the workforce as a whole. In contrast, the impact of IT outsourcing projects can be more commoditised, cost-driven, and executed almost in isolation from most of the organisation.

While the internal or external management of a company's servers are seemingly invisible to employees, HR processes are noticed because it modifies the way they are used to doing their work. And if they don't like the changes made, then HR will certainly hear about it very quickly!

In that sense, active management of stakeholders is something that has long been a critical part of the HR outsourcing process: employees, managers, HR staff, unions and executive management are all affected when HR processes are outsourced.

Alternatively, the two functions would do well to acknowledge their differences, while still happily and openly pilfering best practice options from each other where necessary. It is not just about cost. It is about thoroughly exploring whether you can improve your business through the implementation of outsourcing, and then engaging with the right stakeholders to help you achieve that goal.

For example, in general, successful HR outsourcing projects have demonstrated that processes can be outsourced to make an organisation stronger: not just in cost savings but also via improved service delivery, better management information and overall increased value to the company. These achievements are often due to the emphasis that HR outsourcing project managers place on governance: managing various stakeholders, governing various providers and determining decision rights for a smooth project.

An IT outsourcing professional can do the same by ensuring that a good governance structure and IT outsourcing management system is in place and implemented from the outset. There is a lot of money and resource to be saved (and clawed back!) from this way of working, but our research shows that it is often way down the list of priorities for IT managers.

Additionally, to hit the typical cost-saving targets in HR outsourcing projects, deploying the right technology is an important parameter, but too often the IT stakeholders are not involved enough.

However, since this is not just about doing processes in a cheaper way, but also about doing processes in a better way, it is essential that IT managers adopt a client-focused attitude to their HR customers (both internal and external) so that the right functionality gets implemented, sometimes regardless of IT's preference for certain technology platforms.

IT outsourcing project managers can also share some lessons with their HR counterparts. The drive towards standardisation of processes (still relatively new in the HR domain) is a major enabler of sustainability in IT outsourcing projects and is often not emulated enough in the HR outsourcing sector.

What IT managers can take from this, is that business stakeholders need to be involved in relevant IT outsourcing decisions as much as possible. EquaTerra has found that where the two work together closely and have adopted a joint "can-do" attitude, outsourcing projects are better off.

This was last published in January 2009

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