If you don’t know or follow these writers, you’re missing out on some of the best original content in the market. Don your shades, lather yourself with SPF and let’s take in the insight that only HR bloggers can provide. It will warm you with the knowledge that somehow, somewhere, someone has walked a mile in your sand-filled shoes:

• Mervyn Dinnen throws stones into the recruiting ocean and asks, Is your recruitment partner damaging your bottom line?
• Mike VanDervort’s sandcastle bridges the moat to his wife’s success in, Networking: It’s a small world after all
• Amit Bagria tackles waves of incentives with, What are the different categories of reward and recognition programs?
• Susan M. Heathfield covers up in, Documentation Dilemma, CYA or… ?
• Justin Field judges your surf skills with, Have you done your performance review yet?
• Lois Melbourne plays beach soccer and asks, How talent management is like the World Cup?
• Mark Vickers peers across oceans and describes Four key challenges for developing global leaders.
• Gireesh Sharma casts a line and questions whether Employers can be bad and still attract candidates.
• Mike Haberman recognizes the arrival of summer yet challenges the Value of vacations.
• Cathy Missildine-Martin scans the horizon with, Who values you most at work?
• Tanmay Vora faces the big waves in, Survival mindset, abundance and leadership.
• Melissa Prusher peers through clear blue waters with, Transparent communication.
• Ben Eubanks patrols the beach and offers An open letter to HR on policies, regulating and training.
• Lisa Rosendahl collects the shiniest shells in, How to make exceptional staffing decisions.
• Paul Smith chops up driftwood with, A tool by any other name.
• Laura Schroeder lifeguards your talent in, Are high performers the worst managers?
• Gautum Ghosh goes deep in, What does social CRM, enterprise 2.0 mean for hr and work?
• Lance Haun leaves terra firma behind with, Social media isn’t rocket science.

Dolphin break. Why? Because they’re smart and cool, just like certain HR peeps such as these writers:

• Dan McCarthy schools alpha fish in, Establishing a culture of distributed leadership.
• Melanie Sklarz questions your respect for the oceanic diversity with, Does your workplace really need sensitivity training?
• Wally Bock shares a fireside story with the classic, Once upon a time.
• Shauna Moerke body surfs through technical waves in, When it’s this easy…
• Jennifer V. Miller pushes against the current with, Game-changers welcome resistance.
• Benjamin McCall grabs his bucket and offers, How to make a sand pillow.
• John Hunter burns a little by asking, Are “classic” management theories still relevant?
• Naomi Bloom dives for treasure with, Sunk costs versus innovation.

As you soak up the sun this June take time to thank those who stole from their precious vacations to author some of the brightest content in the market. And if you have thoughts, comments or summertime stories, share them in the comments section below and let’s keep the (sunny) conversation going.

As all students of dialect are aware, interpreting another’s language requires a combination of skill, experience and immersion.  Literal translation may be eminently possible, but deriving intent involves a more detailed analysis of origin, region and culture.  Without such comprehension, mistakes will be made, time will be wasted and inappropriate conclusions will be drawn.  HR outsourcing (HRO) has faced and continues to face these same dilemmas, and clarity must be attained before interpretation is simply left to the intermediaries.

Origins and Evolution

Industry anthropologists do not dig very deeply for the lost ruins of HRO.  Many may discover the transactions consummated by Exult (now Hewitt) in the early 2000s as their only point of reference.  Others claim that such outsourcing has been around for decades, perhaps even centuries, citing the dependency that organizations have always had on external sources in support of the needs of their workers.

Despite its questionable origination, this market continues to evolve at an increasing pace.  Today we find over ten thousand service providers claiming to offer HRO, each with their own value proposition, return on investment and competitive differentiation.  It comes as no surprise that you, the human resources buyer, are faced with unprecedented market confusion precipitated and perpetuated by the lack of a common taxonomy. 

The Quest for Clarity

In April of 2008, attendees from around the globe arrived in New York City for the annual HRO World event.  A seemingly enlightened migration of consultants, advisory firms, analysts, industry press, service providers, association leaders, clients and pundits assembled for this sixth instantiation.  One might expect to see and hear all that is relevant to global HR outsourcing, perhaps uncovering the source of this semantic confusion.  In walking the show floor and visiting with vendors, specimens may be gathered with the hope of a great linguistic discovery.  

In examining the collective, one finds universities, commuter services, pet sitters, applicant trackers, pollsters, employee verification services, health clinics and retailers all speaking of their service to HRO.  Clients stand next to their outsourced providers and explain their often unique and unreplicable path to success.  Advisory firms count the number of transactions this past year, each with their own definitions and criteria for inclusion. And what of the HR executives?  Who represents their needs and answers this quest for clarity?  Who, pray tell, is to blame for such continued confusion? 

Divergent Interests

HRO World is not to blame.  Vilification does not belong to one firm, one person, one assembly or one industry body.  Beginning in 2000, the fervor of growth and determination to secure market share necessitated that each participant attempt to define the language of the HRO industry from their own perspective.  This included:

• HR Service Providers: They began to modify pre-existing price lists to support this new holistic version of end-to-end outsourcing.  Experience was strong in some areas, and weaker in others, resulting in depth but not breadth.
• Advisory Firms: A new category of consultant was born, and these firms had the unenviable challenge of ensuring that RFIs and RFPs were responded to in a common format.  With comparative analysis driving awards, service providers tried to influence any language gaps to their advantage.
• Legal Firms: Dealing with hundreds of pages of text, the lawyers attempted to translate intent into legally binding language that will last through significant changes in context and content over a multi-year period.
• HR Departments: Across a wide continuum of standardization, HR buyers did not have a common set of internal metrics and measurement by which to compare the outsourced solution.  What language did exist was country or region specific, causing strife in areas of global deployment.        

This frenzy erupted a mere eight years ago.  Some might argue that this represents ample time for resolution, and were we not addressing such a varied set of global interests, I would tend to agree.  However, with billions of euros, pounds and dollars poured into the HRO market, many have been either unwilling or unable to pause long enough to ensure that sustainability supersedes short-term interests.

On Monday we will explore the convergence of outcomes and possible solutions to this dilemma.  Let’s keep the conversation going.

University of Manchester graduate student Marco Koster took a stab at differentiation in his 2002 thesis, aptly titled Human Resource Management versus Personnel Management. Says Marco:

“The view that there are more similarities than differences between personnel and HR management is shared by a number of authors. Legge, for instance, is tempted to say that there are not a lot (1989: 27) [of] differences between the two approaches, but nevertheless manages to detect some diverging aspects. These however cannot be qualified as substantial differences, but are rather a matter of emphasis and meaning (Legge 1995: 74). Torrington regards personnel management as a continuing process of evolution and growth, in which more and more fields of expertise are acquired and assimilated. Within this evolutionary process HRM is only adding a further dimension to a multi-faceted role (1989: 66), and is not at all a revolutionary concept. However, the effect of HRM should not be underestimated. Armstrong (1987: 34) maintains that although the procedures and techniques strongly resemble those of personnel management, the strategic and philosophical context of HRM makes them appear more purposeful, relevant, and consequently, more effective.

On the other side, authors like Storey regard HRM as a radically different philosophy and approach to the management of people at work (1989: 4). In this view, HRM provides a completely new form of managing personnel and can therefore be regarded as a departure from [the] orthodoxy (Storey 1989: of traditional personnel management.” (pg. 3)

The pundits at WiseGeek take a slightly different approach, whereby personnel management may be subsumed by the broader and more strategic focus of HR:

“When a difference between personnel management and human resources is recognized, human resources is described as much broader in scope than personnel management. Human resources is said to incorporate and develop personnel management tasks, while seeking to create and develop teams of workers for the benefit of the organization. A primary goal of human resources is to enable employees to work to a maximum level of efficiency.”

Confused yet? Many state governments have managed to adopt a coexistence strategy, with the “State Personnel Director” running the Department of Human Resources Management. The real question may be, does it really matter what we call the function? The good folks at PersonnelToday.com tackled this dilemma in their May 2007 issue:

“By all accounts, in many circles the term ‘human resources’ is no longer in mode. When we published our union research earlier this year (Personnel Today, 30 January) – where unions bemoaned the demise of the personnel function, and complained that the term ‘human resources’ was too impersonal, implying that people were just a resource to be exploited – we were deluged with responses from readers in passionate defence of the term ‘personnel’.

But why this obsession with titles in HR? Other departments such as finance and operations don’t waste their time wringing their hands and wondering what title will get them more credibility in the business. At the end of the day, does it really matter what outfit the HR profession is dressed in?”

So what do you think – Is Personnel making a comeback? Should everyone move to Human Resources? Does it even matter? Stir the pot if you so choose or we’ll simply put the issue on the back burner.

Let’s keep the conversation going.

“Under the agreement, IBM will provide compensation, benefits, recruiting, learning, payroll administration, call center support and related IT systems services to Bristol-Myers Squibb. Additionally, IBM will implement a SAP solution and integrate Bristol-Myers Squibb’s global workforce data into one portal that can be accessed by employees, managers and HR professionals around the globe. The services will support Bristol-Myers Squibb’s operations in the United States, Puerto Rico, United Kingdom, Ireland, France, Germany, Italy, Spain and Belgium, as well as, limited support to 40 of its additional country locations in Asia Pacific, Europe and the Americas.”

Phil Fersht of AMR Research has heralded this agreement in his popular blog Horses for Sources, citing this contract as further validation of the yeomen’s work being performed by leading global outsourcing providers:

“As the global providers become increasingly proficient at deploying offshore resources to support these processes, they will generate more cost-savings and compelling business cases for their customers.”

This contract will have interesting implications in the growing solutions and outsourcing battle between IBM and Hewlett-Packard, with HP’s new beau EDS having been awarded a seven-year, $715 million IT infrastructure outsourcing contract with Bristol-Myers Squibb just this past December.

Let’s keep the conversation going.

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Input Variable A) HP

HP has been an uncharacteristic dabbler in and around HRO for many years.  They had been rumored to be entering the market via asset acquisitions ranging from ACS, Convergys, and Hewitt for some time now, but I must say that few (myself included) would have imagined EDS as the target.  Within HR service delivery, HP does have a few arrows in it’s quiver:

1. Announces Nestle as it’s only public HRO Engagement (2006) – Scope includes European payroll with options for benefits administration, including call center administration and some back office operations.  Serves as an extension to the existing finance and accounting outsourcing agreement with Nestle.
2. HP and SAP Alliance – 50% of SAP applications globally run on HP platforms, and HP is one of SAP’s largest clients.  HP also offers SAP consulting and integration services including operations, implementation, upgrades, support and end-to-end outsourcing.
3. HP and Oracle Alliance – More than 100,000 joint customers across every line of business globally, including JDEdwards, PeopleSoft and Oracle HR applications. 
4. HP’s HR Department – Supports 156,000 employees in 170 countries.  In a recent presentation for the Conference Board, HR EVP Marcela Perez de Alonso speaks her efforts to rationalize global HR into functional Centers of Expertise such as total rewards and learning.

Input Variable B) EDS

EDS’ creation of the ExcellerateHRO joint venture in 2005 allowed the firm to move directly into the race for tier one HRO transactions.  However, many have questioned the structure and strategy of the JV and whether it is sustainable in light of formidable competition and increased price pressures.  Here’s how EDS adds up:

1. Current ExcellerateHRO Portfolio – According to published data, 400 clients across nearly all geographies (except APAC) servicing more than 33 million active and retired employees.  Notable clients include CIBC, Total (UK), Bank of America and 7-Eleven Stores.  No new client wins announced since April of 2007.
2. Towers Perrin Joint Venture – Powers the full HR transformation and consulting side of the Excellerate relationship.  Provides global reach in 24 countries and outsourced IT to EDS as part of the initial venture structure.
3. EDS and SAP Alliance – 220 implementations with more than 850,000 users in nine languages and 54 countries.  Over 2,000 certified professionals on staff.  Their internal implementation of SAP is one of the largest in the world. 
4. EDS and Oracle Alliance – Emphasis on applications management, outsourcing, modernization and development services under the brand of the Agility Alliance.  Applications are primarily focused on CRM and HR BPO with 500 professionals on Oracle and 270 on PeopleSoft.

Does A + B = HRO Domination?

In my opinion, it does not.  There is no question that the combined entity will be formidable as a global provider of BPO and ITO solutions, and no one can argue with the depth and breadth of their technological acumen and ability to configure, manage and deploy SAP and Oracle solutions in any location in the world.  However, the one hole that remains is that neither entity brings forth deep and meaningful HR domain and consulting expertise.  Thus, I feel that continued codependency on Towers Perrin will be required to present a credible HR transformation story to the market.  This puts HP/EDS/Towers Perrin next to the likes of Convergys/Deloitte in the HRO landscape.  Competitors such as Accenture, IBM and even ACS (with it’s Buck and Mellon assets) will maintain some advantage with wholly owned and internalized HR consulting capabilities.

This could be resolved with one additional tactical acquisition.  With BearingPoint trading at $1.61/share and lowering its 2008 outlook, I’d see them as one possible candidate for such a takeover.  Suffice it to say that the next 12 months in the market should be quite interesting.

Let’s keep the conversation going.