ADP � Employer Services, a leading provider of HR, payroll and
benefits administration services, today released a joint report
with the Human Resources Outsourcing Association (HROA�) revealing
that the Human Resource (HR) transformation movement is continuing
to gain momentum globally. The report uncovered that a full 90
percent of respondents are currently working on HR
transformation(1), up from 75 percent in 2006. Additionally, 64
percent of respondents said that they intend to expand the scope of
their HR transformation in the coming years.
Now in its fifth year, the 2008 Global HR Transformation Report
studies trends in HR transformation practices in organizations
around the globe. The report addresses key areas involved in the HR
transformation process such as: reasons organizations transform and
the barriers that limit their transformation; transformation
timing; cost and satisfaction; engagement of external resources and
experience; current and future transformation; and, HR outsourcing
and shared services strategy, budget and provider selection.
"The steady growth in HR transformation practices on a global
scale reinforces that organizations rely heavily on the
business-critical services provided by HR. The underlying challenge
faced by HR professionals to achieve cost savings and
transformation goals persists, especially as pressure increases in
today's consistently shifting environment," said Greg Secord,
Division Vice President, Marketing & Strategy, ADP Employer
Services International and National Account Services. "This report
reinforces the need for ongoing HR transformation initiatives and
offers valuable insight to help HR meet the challenges ahead."
As in past years, the report underscores that there are still
hurdles when it comes to HR transformation. For the last three
years, the skills of existing HR staff have ranked as the number
one impediment to HR transformation. Other impediments include
internal bureaucracy, lack of adequate technology and change
management issues.
"HR transformation is an integral part of many global HR
organizations and is clearly on the rise. As this report reveals
there are still multi-faceted challenges that are impeding the
effective deployment of transformation," said Richard Crespin,
Global Executive Director of HROA. "Through the continued efforts
of the HROA and ongoing research, we can help overcome obstacles
and help HR executives find innovative ways to address challenges
and achieve success."
The research report is divided into four sections:
Transformation Status, Transformation Scope, Transformation
Outcomes to Date, and Outsourcing and Shared Services.
Additional key findings from the report revealed:
-- Either buyers aren't taking advantage of resources that are available
in the market, or providers and advisors aren't providing the resources
that buyers need: 70 percent of respondents report that they develop their
own processes for identifying and selecting a provider, and only 48 percent
say they engage consultants or sourcing advisors.
-- Satisfaction with HR transformation is highest in areas impacting
organizational alignment, an important area as it ranks among the top five
reasons organizations transform HR. Keys to success include: access to
better tools/resources; change management and education; management support
at both the top and line levels; and, alignment, focus and standardization.
-- Nearly two-thirds of organizations that are transforming HR are
meeting or beating their cost savings goals of 16 to 25 percent. Price is
now the most significant criterion in provider selection, up from the third
and fourth rank in 2007 and 2006, respectively. Multi-country capabilities
and functional coverage and expertise round out the top three in 2008.
-- The most commonly outsourced processes continue to be transactional in
nature, including payroll, and pension and benefits administration.
However, recruitment outsourcing, a "hot commodity" in the HRO arena,
continues to grow.
-- Although too soon to establish a firm trend, the report revealed a
decline in the use of shared services across all HR processes between 2007
and 2008.
-- The report also gauged the different methods organizations use to
overcome HR transformation hurdles finding that just over two-thirds of
respondents (65 percent) report that they are currently outsourcing or
planning to outsource functions for one or more HR processes. The most
commonly outsourced processes include payroll and pension and benefits
administration.
Research Demographics
A total of 129 respondents completed the 2008 Global HR
Transformation Survey online. More than half (55 percent) of the
respondents are located in EMEA -- 48 percent in Europe and 7
percent in the Middle East and Africa. 39 percent are located in
the Americas -- 37 percent in North America and 2 percent in South
America. The remaining 6 percent are located in the
Asia-Pacific/Australia region.
More than three-quarters of respondent organizations (77
percent) have revenues of more than US$1 billion; 36 percent have
revenues of more than US$10 billion and half of all respondent
organizations employ more than 25,000 people globally. Respondents
also reflect a broad industry distribution including:
manufacturing, transportation & communication, finance,
insurance and real estate as well as other services.
Nearly three-quarters (73 percent) of all survey participants
hold HR functions, 11 percent are in strategic planning and the
remainder are spread among a variety of functions at multinational
organizations that operate in 10 or more countries. Most
respondents (51 percent) hold the job title of vice president or
director, or manager (31 percent).
To download a copy of the 2008 Global HR Transformation Report,
visit www.hroa.org.
About ADP
Automatic Data Processing, Inc. (NASDAQ: ADP), with nearly $9
billion in revenues and over 585,000 clients, is one of the world's
largest providers of business outsourcing solutions. Leveraging
nearly 60 years of experience, ADP offers the widest range of HR,
payroll, tax and benefits administration solutions from a single
source. ADP's easy-to-use solutions for employers provide superior
value to organizations of all types and sizes. ADP is also a
leading provider of integrated computing solutions to auto, truck,
motorcycle, marine and recreational vehicle dealers throughout the
world. For more information about ADP or to contact a local ADP
sales office, reach us at 1-800-225-5237 or visit the company's Web
site at www.adp.com.
About the HROA
The HROA is the definitive independent organization for all
those who purchase, provide, or participate in HR transformation
and outsourcing. The mission of the European Chapter is to educate,
promote research, publish, recognize, and provide networking
opportunities to foster professionalism in HR transformation and HR
outsourcing across Europe. Its membership encompasses over 7,500 HR
executives, including the largest 50 buyers, the top 30 providers,
the leading sourcing advisors and attorneys, and the best thought
leaders in HR Transformation. The HROA brings its diverse
membership together to set standards and practices, provide peer
networking, and maintain a robust curriculum.
For information about the HROA, visit www.hroa.org.
(1) For the purposes of this report HR Transformation is defined
as any concerted effort to change and improve HR operations,
whether through outsourcing, shared services, internal
reengineering or a combination of these strategies.
For more information, contact: Terry Corallo ADP (973) 974-7612
terrym_corallo@adp.com Zach Siegel Cohn & Wolfe for ADP (212)
537-8102 zach.siegel@cohnwolfe.com
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