HRO World Annual Conference
April 26-27, 2006, at the New York Hilton & Towers, New York City
What: HRO World is an annual confab for analysts and providers and buyers of human resources outsourcing services.
Show info: For more information, go to www.nyhrweek.com
HROA Best in Shows -- Day 2
Date: April 27, 2006
HRO meets the Oscars: The Human Resources Outsourcing Association’s second annual awards gala was packed Wednesday night as providers and buyers applauded one another’s work. Among the winners was Karen Bowman, president of employee care at Convergys, as HRO provider executive of the year. Accenture and Hewitt tied as HRO large-market provider of the year, beating out Convergys. Jim Borel, senior vice president of human resources at DuPont, won the esteemed award of HR buyer executive of the year, but was the only one whose thank-you speech got cut off by the music.
It takes a village: Employers who think that they can just assign a couple of human resources managers to handle the selection and implementation of their HR BPO process may want to reconsider. In his keynote speech, Ernest Lareau, HR director, portfolio and program management at DuPont, described how his company assigned about 50 managers to work on the task full time, along with another 100-200 global managers who worked on it part time. "Don’t underestimate the challenge in front of you," Lareau advised attendees.
Offshoring options: Don’t expect HR BPO providers to show any loyalty to a specific country, no matter what the current trends are, warned panelists of the HRO Reality Panel. "Providers will go to where they can do it cheaper and better," says Joe Vales, a principal at Vales Consulting. Michel Janssen, president of supplier solutions at Everest Group, supported Bale’s point by noting that a few years ago Everest was tracking 20 cities, last year it was tracking 50, and this year it is tracking 100. "It is going to be a global environment," he says.
War for talent in this room: While many speakers talked about the war for talent facing U.S. employers, one only had to look around the room to see how intense this war is in the HR BPO world. The average panel of the conference had at least two speakers who were new to their positions or their companies. "There is incredible movement in this space," says Michael Salvino, HR outsourcing sales and accounts co-leader at Hewitt Associates.
Show notes: It’s a Tough Road
Date: April 26, 2006
Brave soul: Nine months after writing his infamous article, "Why We Hate HR," Keith Hammonds, executive editor of Fast Company, made a bold move being one of the keynote speakers of the conference. While not apologizing for his position on HR, he explained that he wrote the piece because "HR is important" and he is worried that the profession has become too complacent. He lambasted HR managers for sticking to "just planning picnics" and not taking risks. Hammonds cited statistics showing that only 40 percent of employees say that their companies retain skilled talent, then asked, "How many businesses could get away with those numbers?"
Lessons learned: One of the hardest lessons that Sharon Taylor, senior vice president of human resources at Prudential Financial, learned from her company’s HR BPO experience is not to assume that the best and brightest HR professionals will automatically become the best workforce managers. Prudential was one of the first buyers of HR BPO in 2001 when it signed its deal with Exult (now Hewitt), and as a result of that process the company had to let a lot of its HR managers go. But Taylor realized that a lot of the people she originally hoped to keep weren’t the strategic business thinkers they needed to be. "Old school isn’t going to cut it," she says. In the post-outsourcing model, the new HR staff has to be people who can analyze metrics, negotiate deals and be focused on the business. Prudential’s HR staff went from 541 people to 185.
Bad news for recruiting outsourcers: A recent study by Towers Perrin found that 41 percent of the HR BPO buyers with 10,000 employees are outsourcing their recruiting process. However, 59 percent of that group say they are dissatisfied with the quality of the service.
Exhibitors meet exhibitors: For the most part the conference was packed with providers, with very few buyers touring the aisles of the exhibit hall. But that didn’t dishearten all vendors. Tak Kusano, vice president of global alliances at software company Nakisa (a first-time exhibitor at the show), says it’s "less about sales and more about alliance discussions." Also, it doesn’t hurt to have a bunch of analysts around, he says.
Conference buzzword: "Change management" was the buzzword of the conference as providers and buyers alike discussed how setting expectations and creating the groundwork for an HR BPO transaction is the hardest part. Donald Biron, client sales executive at ExcellerateHRO, says that the implementation process is often the most difficult part of a deal. He predicts that as change management becomes more of a hot topic, buyers will start putting language related to the concept into their contracts.