Latest Trends in Multi-Process HRO: Technology Takes Center Stage
The Multi-Process Human Resources Outsourcing (MPHRO) market continued its moderate growth trajectory in 2014, reaching about US$ 3.42 billion based largely on new deals, mid-tenure scope expansions, and contract renewals.
Business Process as a Service Solutions
In the midst of ongoing moderate growth, one notable trend is aggressive adoption among HRO buyers of various supporting technologies. Though still fairly uncommon, adoption of third-party Business Process as a Service (BPaaS) solutions has been on the rise in recent years – among both new deals and existing deals. Larger and mid-sized organizations tend to adopt the high-profile industry leaders, Workday and SuccessFactors, while smaller organizations tend to adopt proprietary platform-based BPaaS, such as those offered by ADP in the U.S., MidlandHR in the UK, and Peoplestrong in India.
Robotic Process Automation
Robotic Process Automation (RPA) – essentially defined as automation that can handle rules-based and repetitive tasks without human intervention, or unassisted automation – is also a topic of conversation, though Everest Group research indicates that most HR providers today view RPA as more sizzle than steak. RPA can generally be applied to back-end administrative processes that are structured, repeatable, and rules driven, making it a potentially viable option for several HR tasks: employee data management; data transfer among multiple discrete HR systems; and several candidate management chores, such as search, profile creation, and offer letter generation.
Although HR faces challenges in implementing RPA, chief among them being the volume of unstructured data and the comparatively low maturity of HR metrics, RPA offers significant potential value for HR:
- Productivity and efficiency: RPA tools are at least twice as fast as human FTEs and can function 24x7
- Accuracy: Automation eliminates manual intervention, thereby reducing errors
- Cost savings: Robotic automation tools are up to 65% less expensive than offshore FTEs
- Compliance: In addition to increased accuracy, robotics allow data and processes to be retained onsite
- Scalability and flexibility: The ability to replicate robotic tools across geographies or business units increases scalability and flexibility
Note: More information – The rising adoption of technology in MPHRO is just one of the headline trends captured in the Everest Group’s recently released Multi-Process Human Resources Outsourcing (MPHRO) Annual Report – Transition to Changing Realities.