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Common HR and Payroll Outsourcing (BPO) mistake 5: Fear of losing control

Posted by: on 16 May 2016 in Human Capital Management

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The idea of HR outsourcing can generate a degree of uncertainty internally. One key concern is who will control the HR process and manage the security of internal data once it has been transferred. That is not just a concern for the HR department. The wider leadership team also fears any loss of control of sensitive company information. However, what is often overlooked is that BPO can actually create a safer system for data security, while the control rests firmly in the customer’s hands.

World-class BPO providers take care of the IT capabilities (with a Disaster Recovery Plan), security budgets, certifications (look out for a provider that is SOX compliant, for instance), all under-pinned by a comprehensive understanding of local legislative data rules. They must also have server centres of a sufficient scale and sophistication to protect against outside cyber threats.
Data security also depends on the expertise of staff. As technology becomes ever more complex, and more operations transfer to the cloud, data handling expertise becomes an urgent priority. Again, this is well-supported by BPO providers with highly trained and experienced staff in exactly these technical and specialist areas.
Transferring the running of back-office HR administration to a BPO provider does not mean you transfer control. Far from it. Liaising with the provider to agree terms on how data is used, stored and secured, is a key role for the retained in-house HR team. The management of this is a service that is provided, not an operation that is lost. In addition, forming an internal outsourcing engagement team with overall responsibility for the scope and quality of the services to be transferred can help allay any fears that remain. This would include tracking and managing service level agreements, service credits, trending, control, and process impacts resulting from changes. The service delivery manager(s) would then also be responsible for overseeing new HR initiatives and managing changes to existing services.

The security of data and employee information becomes less of a concern under best-in-class BPO arrangements, not more, while also offering even greater control. Organisations address any concerns about maintaining control by checking the following five points: 

“BPO can actually create a safer system, while the control rests firmly in the customer’s hands”.

1.Service Level Agreement (SLA) and contract.

2.Service Delivery Model with HR KPIs (progress and updates on a monthly basis on the operational deliveries from the provider).

3.HR CRM dedicated to service delivery.Having the ability to check demand and access data at any time with tools and platforms to support delivery.

4.Governance structure consisting of decision makers and stakeholders from both the client company and provider to review strategy and progress.

5.Ability to conduct an IT and Data security capabilities investigation (validating and checking for certifications, SOX compliance,resources allocated to IT security, respect of local rules)

Written by: The Connect@ADP Team

Originally published November 18th 2014

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TAGS: BPO HR human resource Outsource Outsourcing Payroll

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