BUSINESSES OUTSOURCING MANY ACTIVITIES REAP MORE BENEFITS
- Manpower Outsourcing Survey
- Organisations excel at outsourcing as the number of activities they
outsource increase
Most UK organisations outsource some of their business activities
but research released by Manpower today suggests that satisfaction
goes up as organisations outsource more of their activities.
The survey, asked 2,000 HR managers and directors across the UK
to highlight their outsourcing intentions for the next two years.
Organisations are citing positive benefits in terms of quality,
productivity and cost savings as a result of outsourcing. Two-thirds
of those currently outsourcing say that it has saved the company
time and money (68%) and/or enabled them to concentrate on their
core business (66%), and a substantial proportion believe outsourcing
has simply become an established way of working (56%).
Furthermore, satisfaction increases substantially as the number
of activities outsourced increases. Of those organisations outsourcing
five or more business activities, 85% said that it has enabled them
to concentrate on core business, and 78% said that it saved them
time and money. This increased satisfaction is driving future outsourcing
plans: in the context of broadly flat growth over the next 2 years,
this group of companies (those outsourcing five or more activities)
is set to increase in size over the same period.
Andy Williams, Manpower’s Operations Director, believes that
the key challenge for UK businesses over the next few years is improving
productivity and that outsourcing can play a key role in achieving
this:
“Customers are becoming more demanding – they want more
for less, and faster than ever before. But inflation remains low,
keeping prices down. The result is margin erosion – unless
you can improve productivity and efficiency. Outsourcing is a effective
way of achieving this, plus it can facilitate a focus on core activities,
which drives future profitability.”
Williams continues: “This survey shows that most companies
now recognise the value outsourcing can bring to their business,
but also reveals the high standards they rightly expect of outsourcers.”
A substantial proportion of organisations outsource activities that
are normally considered core: 6-8% of organisations currently outsource
sales, marketing, HR and/or R&D. The outsourcing of critical
activities like these demonstrates how important the trend towards
outsourcing has become in the UK. Indeed much of the growth over
the next two years in outsourcing will be in these areas: IT, HR,
marketing and R&D outsourcing are all set to increase significantly
over the next two years.
Looking at differences across industry sectors, Telecommunications
and Other Manufacturing are planning the largest increases in outsourcing,
with public sector organisations planning a significant rise in
IT and HR outsourcing over the same period.
Case study
Manpower’s experience in demonstrating the real value of outsourcing
is showcased through its contract with Hertfordshire County Council.
HCC is the first local authority to outsource its recruitment function.
HCC is Hertfordshire’s biggest employer, with 25,000 staff,
all of who play a critical role in providing the best possible local
services at the lowest cost to the taxpayer.
“To provide first class services we must recruit well-trained,
motivated and customer-focused staff. Manpower is making this happen
– letting us concentrate on providing top quality community
services, adding real social and economic value to the local community”,
said Alan Warner, Director of People and Property.
Manpower is using leading edge technology to fill 10,000 full-time
vacancies and over 3.5 million hours of flexible vacancies over
the 5-year life of the contract – and cut HCC’s 7-figure
recruitment budget by 5% in the final year. Improved supply chain
management has already reduced direct costs by 13% gross. Generic
advertising delivers improved response rates with a 65% saving on
advertising spend. The contract has also delivered against the council’s
e-procurement strategy by cutting the number of invoices that HCC
has to deal with on an annual basis from over 50,000 to just 600.
Warner concludes: “Outsourcing recruitment means we deliver
better services to our staff and the community at less cost to the
taxpayer. Everyone wins.”
In 2003, Hertfordshire County Council was ranked as ‘Excellent’
by the Audit Commission in its Comprehensive Performance Assessment
(CPA), its new performance management framework for councils in
England. Hertfordshire County Council was also named Council of
the Year by Local Government Chronicle (LGC). This prestigious award
recognises excellence and innovation in local government over the
past year.
For further information, please contact the Manpower Press Office
on 020 8870 2214. Or you can e-mail us by selecting Press
Office from the Contact
Us page.
