Research Proposal Sample Work

Advantages and Risks associated with outsourcing HR
functions in organizations and managing them.
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Contents
1. INTRODUCTION ............................................................................................ 5
1.1 Aims and Objectives .................................................................................... 8
2. LITERATURE REVIEW ................................................................................. 9
2.1. Human Resource Management Challenges ................................................ 9
2.2 Rational for Outsourcing Human Resources ............................................. 11
2.3 Effect of Organizational Characteristics and Environment ....................... 14
2.4 Elements of human resource Outsourcing ................................................. 15
2.4 Benefits Derived from HR Outsourcing .................................................... 17
2.5 Risks in Human Resource Outsourcing (HRO) ......................................... 19
2.6 Perspectives for HR Outsourcing .............................................................. 22
3. Research Methodology .................................................................................. 27
3.1. Introduction ............................................................................................... 27
3.2. Research design ........................................................................................ 28
3.3. Research Philosophy ................................................................................. 28
3.4. Research Approach ................................................................................... 30
3.4.1. Deductive approach ............................................................................ 30
3.4.2. Inductive research approach ............................................................... 30
3.5. Research strategy ...................................................................................... 31
3.6. Time Horizon ............................................................................................ 32
3.7. Sample Location and Target population ................................................... 32
3.8. Sampling ................................................................................................... 32
3.9. Sample size ............................................................................................... 33
3.10. Data Collection ....................................................................................... 34
3.11. Validity and Reliability........................................................................... 39
3.12. Ethical approaches .................................................................................. 40
3.13. Informed consent .................................................................................... 41
3.14. Interview textual analysis ....................................................................... 41
3.15. Summary ................................................................................................. 42
4. Results and Analysis ....................................................................................... 42
4.0. Introduction ............................................................................................... 42
4.1. Participants Profile .................................................................................... 43
4.2. Implementation of HR Policies and Practices .......................................... 44
4.3. Motives of Outsourcing Decisions: .......................................................... 46
4.4. Strategic viewpoint of Outsourcing .......................................................... 48
4.5. Driving factors of HR Outsourcing .......................................................... 49
4.6. Benefits of HR outsourcing functions ...................................................... 50
4.7. Challenges and issues in outsourcing ....................................................... 51
4.8. Outsourcing and its impact on HR team ................................................... 52
4.9 India as your HR outsourcing destination ................................................. 55
4.10 Outsourcing Vendors interview transcript:.............................................. 57
4.11 Summary: ................................................................................................. 68
5. Discussion & Conclusion ................................................................................ 69
5.0 Core motives and benefits of HR outsourcing........................................... 70
5.0.1 Low cost operation .............................................................................. 70
5.0. 2 Competitive advantage ....................................................................... 70
5.0.3 Increased flexibility ............................................................................. 71
5.0.4 Increased quality .................................................................................. 71
5.1 Challenges and issues involved in HR outsourcing .................................. 72
5.1.1 Vendor selection .................................................................................. 72
5.1.2 Selecting outsourcing functions........................................................... 73
5.1.3. Inconsistent quality and performance ................................................. 73
5.1.4 Privacy and confidentiality of organizational data .............................. 73
5.2 Challenges and issues faced by vendors .................................................... 74
5.2.1 Delayed response time and miscommunication .................................. 74
5.2.2 Stringent work practices and assessment procedures .......................... 74
5.3 Effective outsourcing practices.................................................................. 75
5.3.1. Effective practices of outsourcing organizations ............................... 75
5.3.2. Effective practices of vendors ............................................................ 75
6.Conclusion ....................................................................................................... 76
6.1. Limitations and future studies .................................................................. 78
6.2 Recommendations ...................................................................................... 79
6.3. Making an outsourcing decision ............................................................ 79
6.4 Managing relationships and contract ...................................................... 79
6.5. Major risk in HR outsourcing ................................................................ 80
6.6 Establishing a governance structure ....................................................... 80
6.7. Selecting a service provider ................................................................... 81
6.8 Strategies to avoid the risks in HRO ...................................................... 82
6.9 Future Research Opportunities ............................................................... 82
References: ....................................................................................................... 83
Appendix ............................................................................................................. 96
INTERVIEW QUESTIONNAIRE FOR OUTSOURCING ORGANIZATION
............................................................................................................................. 96
INTERVIEW QUESTIONNAIRE FOR OUTSOURCING VENDORS ..... 127
Chapter 1. INTRODUCTION
The effect of globalization brought drastic changes in the business sector in

many developed countries across the globe. Organizations are currently facing
tremendous competition from domestic and international markets. Hence,
control of production costs and management of human resources has become
extremely crucial to sustain in a competitive and dynamic environment
(Armstrong, 2011).
With changing business strategies, human resources in leading organizations

have started playing a crucial role in the organizations success through value
creation through strategic human resource management (Becker et al., 1997;
Wright and Snell, 1999; Roehling et al., 2005; Armstrong, 2011). Human
resource management has begun transforming from being service-provider to
strategic business partner, helping senior management to deliver results in spite
of competitive challenges aligned with values, goals and objectives (Ulrich,
1997; Becker and Huselid, 1999; Bentley, 2008; Swift, 2012). Therefore, it has
become necessary for almost all organizations to allocate their resources and
time towards human resource management and development programs,
especially in regard to staffing, performance management and training and
development (Roehling et al., 2005). Unfortunately, it is not always possible for
organizations to dedicate resources towards core business requirements due to
being pre-occupied with transactional and operational activities. Hence
Outsourcing of non-core activities such as human resources has become an
optimal choice and to gain competitive advantage by focusing on core
competencies (Vanson, 2001; Weidenbaum, 2005).
Outsourcing can be defined as the mechanism with the help of which
technological services are bought from external specialists on the basis of a
contract in order to substitute internal resources (Gelbstein, 2003). In other
words, Belcourt (2006) mentions that when an organization contracts with
another organization or third-party provider in order to offer services or
products of a major function or activity in the case of HR, its various elements
of HR functions, it can be termed as outsourcing (Turnbull, 2002; Cooke et al,
2005).
The current business world is promoting HR outsourcing as one of the most

powerful trends in re-shaping management (Belcourt, 2006). However, past
organizations shifted from in-house activities (Klass et al, 1999) to outsourcing
certain functions, such as hiring firms to operate their cleaning or restaurant
functions (Armstrong, 2011). The difference is the scale and scope; firms are
outsourcing everything from information technology management of entire
functions such as human resources (Lee, 2001; Qulin and Duhamel, 2003). The
main idea of outsourcing has always been the same if you are not good at it,
outsource it- look for the vendors that specialized in it (Armstrong, 2011, p-8).
HRO (human resource outsourcing) can be described as acquiring of in-progress

Human Resource services by the company from an external or third party seller
that the company otherwise looks after by itself (Esen, 2004; CIPD, 2009). The
Human resource services can vary based on the sector size and type of the
Outsourcing company example, technical staff such as IT professionals for
software companies, Business managers, accounts for banking sectors, call
center and marketing executives or even skilled Technicians and labor for
manufacturing sectors (CIPD, 2009). Outsourcing of human resource (HRO)
can help organizations to redeem the top level management from their day-to-
day administrative responsibilities to concentrate on core business activities and
shifting the former responsibilities to third party vendors (Esen, 2004).
HRO is always a best and considerable option, especially for organizations that
does not want to be worried by unimportant, non- core activities such as payroll,
benefits, staffing, and training or performance assessments (Roehling et al.,
2005), as it can reduce expenditure, raise economics of scale as well as
competence from the most up-to-date technology (Adler, 2003; CIPD, 2009).
Apart from these, organizations also get a chance to utilize time on focusing
their interests on strategic performance that helps in the companys success and
competitive benefits (Esen, 2004; CIPD, 2009). By indulging in human resource
outsourcing the organizations not only are advantageous because of a firms
business approach, but they can also ensure the flexible accessibility of
specialized services where they required at a reasonable price. Nevertheless,
HRO requires attentive groundwork and monitoring to be fully advantageous
(Esen, 2004; CIPD, 2009; Padhy, 2013). In other words, human resource
outsourcing is the transfer of the management or administration of a process or
function from in house staff to an outside service provider (Sally, 2005)
On the contrary, outsourcing of human resource functions without proper

groundwork give rise to other risks such as impacting employee morale and
risk of transferring expertise and insider knowledge to vendors. In some cases,
organizations fail to get expected results or become prone to many other risks in
terms of finance, over-budget or lack of quality (CIPD, 2009; Ricciuti, 2013).
In addition, in spite of effective outsourcing, external factors such as political,

economical, scientific, technological, legal, environmental factors (PESTLE) as
well as organizational factors highly influences the countrys labor force and its
HR practices (Klass et al., 2001; Lilly et al. 2005).
The research examines the benefits and risks with HRO and the management
strategies adopted to minimize the risks is projected.
1.1 Aims and Objectives
The aim of the research is to achieve to investigate the advantages and risks that
are associated in human resource outsourcing and different techniques that are
used to manage the risks.
The aim of the research is attained with the help of the following objectives:
1. To identify the advantages associated with human resource outsourcing

(HRO).
2. To identify the risks associated with human resource outsourcing(HRO).
3. To identify human resource functions that can be outsourced and that

cannot be outsourced.
4. To understand how risk management practices will help in avoiding and

resolving these risks.
Chapter 2. LITERATURE REVIEW
2.1. Human Resource Management Challenges
The past decade has experienced major shifts from personnel management to
strategic human resource management (Price, 2007). Concepts of integrating
industrial relations (Guest, 1991), aligning business strategies and de-layering
HRM responsibilities to line managers (Brewster et al, 1997) have led managing
of human resources to be used as a competitive advantage (Budhwar and
Sparrow, 1997). In contrast to the traditional grasp of the administrative role of
human resource management, HRM has been reinterpreted more as an internal
consultant that plays an advisory role in managing people to achieve
organizational competitiveness and advocate organizational change (Kenton and
Moody, 2003; Wright, 2008).
Organizations usually face many kinds of challenges in terms of finance,

marketing, legal or production. Yet a major risk faced by any organization is the
human resource management, risk, especially in higher level management
where organizations get pre-occupied with operational activities thereby
neglecting crucial human resources development and risk management
strategies (Armstrong, 2011). The rise of competition in the business world and
the constant change of technologies in industries are driving organizations in
being concerned about the contribution of human resources to their
organizational performance (Armstrong, 2011; Tanfous, 2013).
According to the CIPD (The Chartered Institute of Personnel and Development)

survey report (2009) conducted with 315 HUMAN RESOURCE practitioners,
the majority of the members felt that in order to survive and compete in the long
run, human resources are required to transform to a strategic partner and has to
play an influential role over traditional performance. Ulrich (1998) in The
future calls for change highlighted various arguments in relation to the human
resources role in future. He considered the contradictory views of different
people where one believes that those who are involved in human resource
should become influential strategic consultants while others believe that the
entire human resource department should be outsourced. In order to help human
resource become a strategic partner, there is need to transfer the transactional
and administrative functions to the line manager who is usually reluctant to
carry additional burden besides business responsibilities (Ulrich, 1998).
In contrast, Boninelli and Meyer (2004) used the following table to illustrate the
present and the future role of human resources.
Table 2.1: The Current and Future Role of HUMAN RESOURCE (Source: Bonninelli &
Meyer, 2004)
CURRENT FUTURE
Performance enhancement Performance enhancement
25% 40%
Strategy The Strategy required
5% 30%
Transactions Transactions
30% 15%
Administration costs Administration costs
40% 15%
Armstrong (2011) strongly argues that human resource should free themselves
from administrative and transactional activities and needs to focus on improving
their capacity to deliver value-added services. Similarly, Ulrich (1998) mentions
that human resources hold keys to success for organizations in overcoming
major challenges such as globalization in coming years. Globalization entails
new markets, new products, new mind-sets, new competencies and new ways of
thinking about business and therefore in future there is a dire necessity for
human resource to create models and processes for attaining global agility,
effectiveness and competitiveness (John, 2013; Tshirado, 2013).
Almost all the researchers and HR professionals are calling for human resource
to perform an active and strategic role in order to help organizations to achieve
its competitive position (Greer et al., 1997; Ulrich, 1997; Klass et al., 1999;
Klass et al., 2001, Sally, 2001, Weidenbaum, 2005; Belcourt, 2006; Wright,
2008; John, 2013). However the higher level management in organizations must
make sure that the transactional functions should be delivered in a cost effective
and efficient manner but at the same time in the order to achieve this,
transferring the complete responsibility to the line managers might not be a
good idea or a right alternative as the line managers should also have to
concentrate on the core business just like the human resource (Klass et al.,
1999). This intern gives rise to a question whether Human Resource outsourcing
(HRO) really helps the human resource in transforming to a strategic partner in
a cost effective and efficient manner and organizations to achieve the results
they have expected.
2.2 Rational for Outsourcing Human Resources
Human resource outsourcing is highly dependent on organizational

characteristics which include human resource generalists activities (e.g.,
performance appraisal), transactional activities (e.g., payroll), human capital
activities (e.g., training), and recruiting and selection. It is reliant on
idiosyncratic human resource practices, strategic human resource involvement,
positive human resource outcomes, promotional opportunities, demand
uncertainty, and pay level with variation among the different types of human
resource activities being outsourced (Klass et al., 2001). Almost all the
organizations are outsourcing certain functions to third-party companies for
various reasons at both strategic and operational levels (Klass, 2003; Cooke et
al., 2005; CIPD, 2009). According to the CIPD survey (1998) the majority
respondents report that the main drivers for outsourcing human resource are: 1)
access to skills and knowledge; 2) quality, 3) cost reduction and 4) governance
structure (Cooke et al., 2005; Hindle, 2005, Sparrow and Braun, 2007). In other
words, according to resource-based approach, human resource outsourcing can
be an instrument that creates time for human resource to become a strategic
partner and therefore is viewed as an opportunity. While a second view
considers human resource outsourcing a Human Resourceeat which initiates
from a cost-cutting instrument gradually reducing human resource staff
(Delmotte and Sels, 2008).
Among these factors, cost reduction ranked in the first place and a major reason
(61%) and innovation in the third place (CIPD, 1998). According to
International Data Corporation report the primary reason for BPO companies
to outsource is to minimize costs which have become the main motto in their
contract agreements (Alders, 2001; Belcourt, 2006; Yang et al.,2007). Belcourt
(2006) in his report about BP (British Petroleum) outsourcing clearly mentions
that the first reason for BP to outsource its human resource is to reduce costs
while the second is to provide quality support for its employees and the third is
to focus on its core strategies and off-load the time consuming administrative
work. BP by outsourcing its human resource functions and relocating its 56,000
US and UK employees achieved a result of 40% reduction in human resource
staff, $15 million of its operating costs and $30 million of funding in capital
costs for technology. Furthermore, Cohan and Young (2006) also state that by
outsourcing human resource, organizations are able to control costs due to cost
savings and efficiencies associated with BPOs.
In contrast, Thompkins (2005) disagree that the primary reason to outsource is
cost control and strongly argues that the goal for outsourcing is to make sure
that the higher level management can focus on value-added services and core
business processes. In the same way 45% of the sample people in the CIPD
survey (1998) considered the relief of human resource staff pressure as a key
HRO driver and 48% of those who engaged in HRO consider access to new
technology as an important driver. According to Metty (2006) the most
important benefit an organization can gain out of human resource outsourcing is
to have access to the early adoption of new technology.
Sally (2001) suggests that outsourcing helps organizations to focus their

development initiatives on developing employee, according to the
organizational core competency which can in turn help it to achieve its
competitive position. Meanwhile, Patel and Aren (2005) believe that flexibility
is another important driver for outsourcing, but flexibility may not be a key
benefit as many organizations feel it is really difficult and often costly to get out
of BPO agreements when required (Kruse and Berry, 2004).
Fig 2.1 CIPD 2010 report used the following table to represent outsourcing drivers and
their achievements (%)
Achieving greatly Achieving partially Not Achieving
Improvedquality 21 59 17
Reduced cost 42 46 10
Accessed new technology 12 51 32
Relived internal HR team pressure 15 39 43
2.3 Effect of Organizational Characteristics and Environment
Human resource outsourcing has become a recent widespread phenomenon

receiving huge interest from both professionals and scholars with debate of its
strategic significance from the traditional perspective of transaction costs,
economic theory (TCE) and a more strategic perspective of resource-based view
(RBV) (Espino-Rodrguez and Padrn-Robaina, 2006). Human resource
outsourcing decision is reliant on organizational aspects such as human resource
practices, strategic HUMAN RESOURCE involvement, positive human
resource outcomes, promotional opportunities, demand uncertainty, firm size,
cost pressures and pay level, variation has also been observed on the extent of
impact due to types of human resource activities being outsourced (Klass et al.,
1999; Klass et al., 2001). Furthermore, on a macro-level, in the HUMAN
RESOURCE provider market, competition amongst suppliers and
environmental uncertainty (primary, competitive, supplier) also affects the
extent of human resource outsourcing leading to impact on human resource
performance (Lilly et al., 2005).
2.4 Elements of human resource Outsourcing
While making outsourcing decisions, organizations need to weigh what can be

outsourced and what cannot be outsourced (Cook, 1999; Greer et al., 1999).
However, many managers approach outsourcing as a solution without first
defining the problem (McCauley, 2000).
The human resource functions may be either partially outsourced or

completely outsourced. The difference is the organization retains some
control over the outsourced functions and may share access to
information with the vendor In the latter, the organization relies upon the
vendor to carry out the entire functionthus, the HUMAN RESOURCE
departments role with regard to the outsourced function is minimal and
may be limited only to managing the relationship with the vendor
(Evren, 2004, p-14)
According to Thompkins (2005), the most important step organizations have to

perform is to first critically analyze what functions or processes can be
outsourced and what should be performed internally. In order to understand
which elements of human resources to outsource the Department of trade and
industries (DTI) has developed the five paths formula.
The DTI project identified and produced a balanced environment in which

employees thrive and seek success for themselves and their organizations. The 5
paths include:
Shared goals understanding the business we are in.
Shared culture agreed values which bind us together.
Shared learning - continuously improving ourselves.
Shared effort one business driven by flexible teams.
Shared information effective communication throughout the company.
Any organization before outsourcing any of their functions can use the five
paths as it is extremely crucial to understand the organizations current position,
future goals, future requirements and organization strengths (Sally, 2001).
In order to assist organizations to identify their core processes, the core

competency matrix have been developed (Tomkins, 2005). The core
competency matrix helps organizations to analyze and distinguish between core
functions and non-core functions, by in order to identify functions that need to
be outsourced over those that need to be performed internally (Greer et al.,
1999; Beatty et al., 2003; Tomkins, 2005).
Table 2.2: Core competency matrix (Source: Tomkins, 2005)

Primary Focus Secondary Focus
Core Things that differentiate your Things that need to be done well
Process organization in the marketplace. but are not visible to the
The reasons customers come to customer.
you.
Non-Core Things that if not done well can Things that need to be done. but
Process have a negative impact on your do not have any significant
customer relationship. impact on the success of the
business.
Apart from the core competency matrix, another alternative is the process
driven approach, where each process is allocated into two values (Kruse and
Berry, 2004). The first value relates to the overall cost of the process and the
second value describes the significance of the process by relating to customer
satisfaction. A ratio is calculated out of it by dividing the cost value by the
significance value with the process with the highest ratio value being considered
for outsourcing (Sally, 2001; Kruse and Berry, 2004). Organizations also must
consider that outsourcing is only beneficial if they outsource the right processes
to the right level or else the idea of outsourcing could lead to greater risks such
as over budgets or sometimes entire business failure (Greer et al., 1999; Sally,
2001; Beatty et al., 2003).
2.4 Benefits Derived from HR Outsourcing
The main benefits that companies are expecting from outsourcing HR are cost
saving, quality improvement and accessing to skills and knowledge and among
these three benefits cost saving comes first and foremost (CIPD, 2009; Esen,
2004). Studies conducted over two years on outsourcing arrangements show
that HR outsourcing resulted in cost saving ranging from 10 20% with an
average of 15 % (Adler, 2003; Henneman, 2005; Oshima et al., 2005).
According to Belcourt (2006) organizations can reduce costs, mainly by
outsourcing HR functions such as payroll, benefits, compensations,
administration and employee assistance program. Human resource management
department (2004) quoted that out of 41% of HR professionals indicated that
cost factor is the main motivation behind HR outsourcing to achieve cost
savings (Esen, 2004).
Patel and Aran (2005) suggest that flexibility is another benefit why
organizations are expecting to outsource, but Kruse and Berry (2004)
contradicted that flexibility is not necessarily a benefit of BPO, as several
organizations were constrained by complications from getting out of BPO
agreements.
In addition, Belcourt (2006) points out that apart from cost and flexibility,
strategic focus and skills improvement are additional benefits that organizations
enjoy out of outsourcing HR. When organizations outsource non-core activities,
managers hope to focus on value-added roles (Belcourt, 2006). Burn (1998) also
quotes that CIBC (Canadian Imperial Bank of Commerce) members gained
competitive advantage by focusing on planning, need analysis, and coaching
after program completion by outsourcing HR functions.
Another benefit of outsourcing is quality improvement (Belcourt, 2006). Laura

(1998) suggests that quality improvement through outsourcing either produce
better quality through improved technological skills or at the least result in
similar quality at lower costs of production. It has also been emphasized that
outsourcing HR gives managers an advantage to choose the best vendors with
outstanding track records and get more flexibility in hiring and rewarding their
employees (Cookie, 2004). In other words, when required, organizations can
choose the top quality talents from various parts of the world and have them
work from their local bases without having to move them into their locations,
thereby maintaining required quality and reduce cost (Armstrong, 2011).
Fig 2.2 HRM survey report used the following chart to represent the
benefits of outsourcing HR functions (Source: Esen, 2004)
2.5 Risks in Human Resource Outsourcing (HRO)
While some studies proved HR outsourcing as a positive element, there are

many cases in which HR outsourcing is proved to be risky as outsourcing
because everybody is doing it result in unexpected costs and complications
(Weidenbaum, 2005; Cooke, 2006). In spite of the advantages that
organizations could gain out of outsourcing, there are certain risks involved. It
is important to remember that the wider research on outsourcing has yet to
demonstrate more financial or service improvements to employers (Greer et al.,
1999).
Albertson (2000) empirical study indicates that about half of the respondents
found that it is more expensive to manage the outsourced activities than
originally expected and the service levels were not as good as expected. This
may result from vendors curiosity to standardize the service by forgetting the
customers requirements (Adler, 2003, p 55). Vendors though understand the
function fail to take clients comforts into consideration when bringing their
services (Greer et al., 1999, p 91).
Fortunately, these kinds of errors can often be dealt with in two ways, one of
which is by dealing with the business model that has been accepted by most
HRO vendors (Hesketh, 2006). In order to attain economics of size and range,
suppliers or vendors try to standardize and codify their services to large extent
by using human resources information systems and setting up collective service
centers that incorporates provision among different HR and client actions
(Alder, 2003; Cooke et al., 2005). Consequently, there is a crucial need for
suppliers to enlarge their size in the form of merger and acquisition (Ordanini
and Silvestri, 2008).
Another way is the reverse of the first and tends to be risky for HRO vendors in
presenting more tailored services. According to the process, HRO vendors need
to have knowledge about the production process of the clients firm and they
need to make a substantial asset specific investment to run those processes
(Klass et al., 2001). As HRO vendors have to make investments, there is risk
when customers might refuse to renew contracts or utilize the threat of non-
renewal for bargaining (Klass et al., 2001).
The vendors will provide services as specified in the contract and if required by
the client organization, adjust according to the changes made in contract which
provides flexibility of adding new features, enhancements or reduction of
services thereby reducing risk of service (Belcourt, 2006). Apart from this,
another vital risk is where HRO organizations may gain expertise in their field
and may enter the market and become competitors to the clients
organization(Belcourt, 2006; Sparrow and Braun, 2007).
Effect on employee morale is another serious risk that organizations face by

outsourcing HR (Hall, 2000; Elmuti and Kathawala, 2000; Belcourt, 2006).
According to Armstrong (2011) organizations give employees a sense of
identification and secure feeling. Disruption makes the employees feel resentful
and may even lead to retaliation thereby negating the impact of HR outsourcing
by eliminating HR staff themselves (Hall, 2000; Belcourt, 2006; Delmotte and
Sels, 2008; Armstrong, 2011).
One third of HR professionals oppose the idea of outsourcing because they risk
losing their jobs or have to work for other vendors (Greer et al., 1999; Badcock,
2004; Belcourt, 2006). Outsourcing can even lead to disintegration of
organizational culture where instead of empowering and valuing employees, the
idea of outsourcing alienates and de-skills them (Adler, 2003; Belcourt, 2006;
Kremic et al., 2006). Once when outsourcing arrangements are stated, the HR
managers expect the senior and talented employees to leave the organization,
leading employees to suffer anxiety resulting in the ultimate loss of production
(Belcourt, 2006).
HRO may not always result in extremely stranded or substandard services either
(Klass et al., 2001). Less regular HR functions may even give chance for HRO
to create more inconvenience to clients as service turns out to be more and more
twisted and codified for the capability and business strategies of provider (Klass
et al., 2001). Human resource outsourcing can also lead to product type service
with low touch as the decisions of placements are centralized in the BPO
industry and are mostly carried out by fulfilling instructions with the use of
software (Kosnik et al., 2006).
Long term outsourcing can even lead to the loss of clients capability to manage
HR effectively. Human resource outsourcing report show that 25% of its
respondents reported that customer service decreased, leading to a minimization
of personal relationship (Esen, 2004; Lily et al., 2005). Further arguments in
literature on HRO raise questions about the positive assessments made on
vendor managed human resource outsourcing, but at the same time also
highlight that outsourcing helps in changing the administrative actives of labor
deputation and reducing costs of production (Klass et al., 1999; Esen, 2004;
Belcourt, 2006; Kremic et al., 2006; CIPD, 2009).
2.6 Perspectives for HR Outsourcing
In order to grasp the many views of the extent of the impact of HR outsourcing;
the following table shows a dissection of the methods and findings for a
comparative analysis of the existing literature.
Table 2.3 dissection of the methods and findings for a comparative analysis of the existing
literature
AUTHOR/ METHODS FINDINGS LIMITATIONS

YEAR/
LOCATIO
N
Klass et Empirical study Transaction Cost The study is
al., 1999 300 HR Economics perspective, conducted just by
executives organizational-level involving HR
Outsourcing factors have been found executives. Opinion
levels, to restrain the of newer and more up
organizational relationship between the to date hr
characteristics, degree of reliance on professionals is not
perceived impact HR outsourcing and taken into
of outsourcing. perceived benefits consideration.
produced by but major HR
outsourcing. decision makers are
usually HR date hr
Positive impact for professionals is not
some transaction cost taken into
hypotheses regarding consideration.
the impact of but major HR
organizational decision makers are
characteristics. usually HR
Relationship between
the degree of
outsourcing and
perceived benefits is
reliant on idiosyncratic
HR practices,
uncertainty, firm size,
and cost pressures.
Pay level, overall
outsourcing emphasis,
or strategic involvement
by HR effect are found
to be insignificant.
Greer et al., Qualitative HR outsourcing used This is a quantitative
1999 research for both operational and research based on
interviews strategic reasons. interviews therefore it
Senior HR Guidelines for does have statistical
executives and selecting vendors, data to validate its
professionals managing outsourcing findings as usually is
25 transition, managing the case with
organizations. vendor relations, and qualitative research.
monitoring vendor
performance are
provided.
Esen, 2004 Quantitative HR outsourcing, views The study is limited
based on empirical study of HR professionals to US based
U.S. U.S. based towards the concept, organizations
298 HR Professional impact belonging to strategic
Professionals. with high emphasis on human resource
partial outsourcing HR. management which
Organizational means these
rationale for HRO, types organizations are
of HR functions prone to make
outsourced, and strategic decisions
decisions for not rather than traditional
outsourcing. cost economic based
ones.
Belcourt, Case-based Rationale for Based on a single
2006 qualitative Study outsourcing HR case.
(financial savings,
increased ability to
focus on strategic
issues, access to
technology and
specialized expertise,
and ability to demand
measurable and
improved service levels)
Risks of decreasing
employee morale and
transfer of expertise and
insider knowledge to
vendors.
CIPD, 2009 Empirical study Half the respondents The report is limited
315 HR agreeing that HRO has to the nature and
practitioners allowed them to play a extent of HR
29% (91 more a strategic role to outsourcing in
organizations) a limited extent, organizations within
are outsourcing 36% failed to see UK.
aspects of HR HRO as a strategic
activity. enabler for HR
function
Based on the above comparative analysis, it is observable that literature is

mostly based on:
Developed countries and from the perspective of organizations outsourcing

HR functions.
In addition, most of the empirical studies are qualitative, and based on case
studies and interviews of HR professionals who are responsible for strategic HR
decision making.
While HRO seems to be a developing concept, with high emphasis on its
formation, adoption and setting up of its guidelines and weighing its pros and
cons, recent findings show still lacking regard for the benefits of HRO (CIPD,
2009).
The risks of HRO are still an impending concern.
HRO is still a based on transactional cost economics perspective rather than a
resource-based view initiative, although there is still much debate.
The risk, benefits and legal implications of HRO from the perspective of the
outsourcing forms are lacking in the literature.
Findings from the literature review will allow scope for analysis of the case-
based qualitative study for this research. The both the professional and
academic review of literature forms a groundwork on which the cases based in a
developed and developing country will present in order to provide a
comparative analytical review of human resource outsourcing, implications and
its future scope in the context to its environment.
Chapter 3. Research Methodology
3.1. Introduction
The research methodology is the process or procedure used to collect

information and assess the information collected so as to arrive at a solution for
proposed research problems. This is as good as a blueprint and facilitates
authentication of information collected. The methodology adopted for the
research outlines as a reference to make sure that the information collected and
authenticated have been done with an ultimate aim to achieve the study
purposes (Sekaran, 2003). In this section, the methodology adopted in this study
has been discussed. This chapter is being followed by a brief summary of
research strategy, sampling process, data collection method, research strategy
methods, and tests for the purposes of reliability and validity of the study on the
lines of Onion framework initiated by Saunders et al. (2009). The method
adopted for this study includes qualitative research to categorize challenges
faced by both HR outsourcing organizations (India) and HR outsourcing
vendors (UK).
3.2. Research design
The design for this research has been done purely for research purpose. This
study adopted the Onion model of Saunders et al. (2003). The "Onion" research
model consists of five different layers which are depicted in the figure 1 below:
Figure 3.1: Onion Model of this dissertation
Research Philosophy
Interpretivism
Research Approach Inductive approach
Qualitative Strategy
Research Strategy
Time Horizon Cross Section
Data Collection Primary and secondary data

Collection
InstrumentSemi-structured interview guide

used
Source: Adopted from Saunders et al. (2009)
3.3. Research Philosophy
For utilizing primary data, the phrase Research philosophy is used to suggest
the method adopted to cull and scrutinize various data. There are three essential
research philosophies governing this research:
Positivism: Positivists believe that the reality is stable to be able to understand

by objective viewpoint. They think that the best way of understanding the
phenomena is to segregate them and repeating the study. This approach
manipulates reality by modifying an independent variable in order to evaluate
the association between such variables of the real world.
Interpretivism: An opposition of positivism is intepretivism and depend on

subjective interpretations. According to this approach, it is very complex to
obtain solution for research using single model when it comes to social world.
However, the natural surroundings can be best examined by Interpretivism
philosophy. It is their firm belief that through the subjective interpretation and
realistic intervention, the phenomena can be understood. Though there is every
possibility of multiple interpretations of reality, each and every interpretation
can be considered during the study. The value of this research philosophy can
be worthwhile if the actual reality is considered during the research background
(Saunders et al, 2003).
Realism: The term realism can also be known as Neopost-positivism, post-

positivism and critical realism (Manicas & Secord, 1982; Huberman & Miles
1985; Hunt, 1991; Guba & Lincoln 1994; Denzin & Lincoln, 1994).. Realism is
a mixture of both positivism and interpretivism as this philosophy has
independent thoughts or beliefs and it can be applied to real world scenarios
(Saunders et al, 2003). The Realists offer significance of ideas or observations
or viewpoints or knowledge of humans (Saunders et al., 2009). However, a
triangulation move of cognitive process is used in a social phenomenon in
realism. From Perry et al. (1997) perception, realism is a perception for realists
is a window on to reality from which a picture of reality can be triangulated
with other perceptions. The reality domains can be categorized in three ways,
the real, actual, and empirical domains. These three domains are used by realists
to analyze the world with.
Since this study main is intended to understand the HR outsourcing issues in
India and offers solutions for the issues faced by them, interpretivism is
considered in this research philosophy. Interpretivism looked at the
phenomenon from why and how in this case, challenges of HR outsourcing
was explored from these phenomenon to make sense of or interpret phenomena
in terms of the meanings people bring to them (Denzim and Lincoln, 1998).
3.4. Research Approach

There are two types of research approach such as: (1) deductive approach
and (2) inductive approach.
3.4.1. Deductive approach
In this approach, various theories have been tested to determine the

solution for the research in question, while the study background offers different
theories for analysis from the earlier literature sources. This is tracked by
arranging of research theories that will act as a guideline for hypotheses. The
arranged research theories are then put to test for authentication of the theories
to reach the conclusion (Marcoulides, 1998).
3.4.2. Inductive research approach
This approach is in contrast with previous approach. Normally, this will

commence with the assessment of data thus leading to development of
hypotheses. On the basis of developed hypotheses, theories can be formulated.
Therefore, the inductive research approach build hypothesis and concepts from
the empirical data (Marcoulides, 1998) already established.
As a result, deductive approach is termed as a top down approach, whereas
Inductive approach is known as bottom up analysis. As far as this study is
concerned, inductive approach is adopted as it expands theories not only limited
to the improvement of HR outsourcing performance, but also provides solutions
to the current issues faced by them. In addition, due to the fact that there is not
much previous study relating Indian HR outsourcing, the present study used the
theories and empirical studies conducted in Western scenario and looked at the
problem from Indian scenario. Since challenges in Indian HR outsourcing are
different from the Western context, present study adopted an inductive approach
and investigated the challenges faced by both vendors and HR outsourcing
organizations.
3.5. Research strategy
Selecting an appropriate research tactic from the study objectives assume

significance in adopting the research methodology. Research strategy can be of
three types such as qualitative, quantitative and mixed approaches.
Qualitative approach: This approach is used to cull non-numerical data from

interview or data analysis method (data categorization). For instance, non-verbal
data such as images or videos are the best examples of this strategy (Saunders et
al., 2003).
Quantitative Approach: Numerical data are collected using this approach

through questionnaire or data examination process (creating graphs or
tabulating statistics).
The qualitative approach, an empirical inquiry was chosen to identify

risks and challenges encountered by vendors and suppliers in outsourcing
Human resources. This approach is deemed to be appropriate since the
phenomenon under study is complex and social in nature and does not lead to
quantification (Liebschar, 1998) and it analyses the perceptions of both vendors
(India) and HR outsourcing organizations (UK). Since there are only limited
numbers of organizations who are actively involved in HR outsourcing,
qualitative would be an ideal choice as it enable understand the research
phenomenon in-depth by collecting a large amount of information and in many
cases a surplus of information. Moreover, the purpose of qualitative research is
not quantity of data collection rather making valuable data that answers research
question.
3.6. Time Horizon

This study adopted cross-sectional research approach due to time constraints.
This facilitates to provide a picture of various factors that support as well as
restrain the HR outsourcing.
3.7. Sample Location and Target population
The study was conducted in both India and UK. The outsourcing vendors
from India were selected as target population. The sample includes both
administrators and employees of Indian outsourcing firms. Using the contacts
obtained from Indian respondents, UK outsourcers were selected as target
population. As the study intended to identify the challenges confronted by the
outsourcing industries, it does not consider the effect of regional distribution or
size of enterprises, although this may an effect.
3.8. Sampling
In general, sampling is used to select the subset of individual from target

population to analyse the traits of whole population. A number of sampling
techniques are available to collect data. The techniques are convenience
sampling, random sampling, systemic sampling and judgment sampling. In
qualitative research, random sampling was not recommended as the intention
was not to gather information in the real world and may also lead to data
skewed to a particular sub-group and introduces sampling error. Hence, in this
study samples are chosen based on the convenience and to obtain rich
information. In this study a non-probability sampling, a purposive sampling
approach was selected since each participant and all aspects of study
environment are specifically designed to collect information to improve the
content validity ((Maxwell, 2009).
3.9. Sample size
This study centered around two groups of samples consisting of

administrators and employees of Indian outsourcing vendors (n=10) and UK
outsourcers (n=10). Details of outsourcers and vendors were obtained from
International association of outsourcing professionals
(https://www.iaop.org/COPDirectory/Directory.aspx). In the starting of the
study, 32 outsourcing vendors from India were approached for the study. Out of
this, only 10 respondents participated in this study, and the remaining members
refused to participate in this study due to several reasons. The major reasons for
non-participation in the survey are: lack of awareness, privacy and
confidentially issues, busy schedule and lack of enough time. On the other hand,
all UK vendors approached for the study participated eagerly in the survey. This
is mainly due to the fact that UK vendors are approached based on contacts
obtained from Indian outsourcing vendors (n=10).
3.10. Data Collection
Usually, two types of data collection methods are employed such as (1)
Primary data Collection; and (2) Secondary data Collection.
The quality of the research shows significant improvement through the

use of the primary data collection method since it helps to reduce the error rate
by cutting down the researchers influence views about the findings of the
study. Moreover, the choice of this method was chosen, because the number of
interviewees was small and in-depth and there is a need to understand and
interpret the overall situation of the outsourcing process.
Research Tool: Semi-Interviews: The perception of respondents could well be

understood through qualitative interviews both on a realistic and on a
connotation point (McNamara, 1999). This study includes semi-structured
interviews to gather data relating to particular issues and the method ease the
work of the interviewer as it decides themes in advance and smoothes the
interview process. However, structured interview does not allow in-depth and
free investigation and hence, the present study chosen semi-structured interview
as purpose is to gather as much as information using a probing method. Based
on the themes, additional questions can be formulated. However, this is not
possible in the structured interview. Therefore, participants were asked
standardized open-ended questions. Each and every interviewee was asked the
same set of open-ended questions, making use of a standard template called as a
questionnaire or interview schedule. The interviewer will ask questions from the
written questions list. However, the success of such interviews lies with the
interviewer skills since the interviewer is aware of the directions of the
respondents views in a particular track. Semi-structured interview questions are
designed based on the detailed literature review undertaken. The following are
the interview questions undertaken for the study.
Table 3.1: Questionnaire design and justification

QUESTIONS JUSTIFICATION
A HR OUTSOURCING ORGANIZATIONS
A1 How would you describe the execution of To identify the importance given to the
HR policies and practices in your HR policies in the outsourcing
organization? organizations.
A2 What are the core motives that have To identify the outsourcers view of the
influenced outsourcing decisions? motivators of HRO in organizations and
their reasons behind outsourcing HRO
services
A3 From a strategic viewpoint, how do you To highlight the concept of outsourcing
view Outsourcing as an initiative? and to identify the companies strategic
view in choosing HR outsourcing.
A4 Which HR functions did you perceive To identify the drivers in HRO decision
required Outsourcing and what influenced making and the motivators of weighing
your decision? the outsourcing options.
A5 Would you describe your HR outsourcing To identify and highlight the Benefits
that the outsourcing companies are
function as successful? If yes, in what ways
expecting out of HRO and to know what
has it benefited the organization? extent they were successful in achieving
them.
A6 What challenges did you face in order to To identify the challenges that
outsource your HR functions? outsourcing organizations face when
outsourcing their Human resources.
A7 How did HR outsourcing affect your HR To identify the benefits (internal)
team in terms of function? enjoyed by the HR team after HRO
A8 Has your organization faced any issues To identify the Risks that outsourcing
related to HR outsourcing? If yes, describe organizations face after they outsource
the instances? their work to the vendor companies.
A9 What were the risks that you had to work To identify the risk management
strategies that are used by the HR
with during HR outsourcing services in
outsourcing companies to minimize
your organization? risks.
A10 Why do you choose India as your HR To identify the aspects that outsourcing
companies consider when they choose
outsourcing destination?
to outsource their work to vendor
companies in specific countries.
B HR VENDOR ORGANIZATIONS
B1 Has your business of providing HR services To identify their justification on why
to organizations been successful? Why do they provide better HR services. To
companies prefer to outsource HR highlight the reasons behind HRO from
activities? the service providers viewpoint
B2 What kind of apprehensions do companies To identify the type of risk
have in outsourcing their HR functions and management strategies that vendor
how do you deal with them? companies follow in order to maintain
trust with the outsourcing comapany
B3 As HR specialist, what are the core To identify the type of HR functions
functions of HR you think that influence they expect either to be outsourced or
organizational strategies? lacking to be outsourced
B4 Which HR functions in the industry are To identify the HRO services that are
outsourced mostly? most popular in India
B5 Have you faced any issues with To identify the general issues and risks
organizations you provide HR services for? faced by the vendor organization while
If yes, what kind of issues have you faced? providing HR services to the
outsourcers.
B6 What initiative do you think helped to build To identify the initiatives taken by HRO
the trust relationship with your clients? vendors to help build trust and
confidence in providing HRO services to
organizations (legal etc). Also identify
the challenges and risks involved in
HRO
B7 What challenges do you have to face when To identify and highlight the common
you provide HR services for developed challenges that Vendor companies face
countries? from their HR department when
providing HR services to developed
countries.
B8 What are risks in accepting HRO from To identify the risks that have to be
developed countries? taken by the vendor companies in order
to provide HR outsourcing to
Devoloped countries.
Secondary data collection: Several methods can be used to cull secondary

data. For instance, newspapers, journals, books, and websites offer as source for
secondary data. Nonetheless, secondary data can be collected from academic
databases, as it ensures the reliability of collected information.
Conducting of the study:
In this study, in order to have a detailed insight regarding HR outsourcing issues

in India a semi-structured interview was conducted among both vendors (India)
and HR outsourcing organizations (UK). The interview process lasted for 50
days as the participants are from two different countries. The major challenge in
this interview process is that a few participants were hesitant to disclose their
business secrets and are afraid of privacy issues. The researcher overcome this
issue by clearly stating clearly the objective of the study and obtaining informed
consent. Moreover, prior to interview, the researcher mailed the interview
questions so as to make respondents feel comfortable an minimize potential for
distress. The research participants include Marketing Head, HR country Head,
Regional HR Manager, Procurement specialist, Assistant Manager and
Associate HR Manager, since these people are closely related to outsourcing
process. Moreover, the manager of service provider was also included in the
interview to have a detailed understanding regarding the issues involved in top
to bottom of the outsourcing project team. Prior to the interview, all the
respondents were informed regarding the purpose of the study and were assured
of confidentiality and privacy. Based on the interviewees availability, interview
was made through phone calls, Skype or Gchat with prior appointment and each
interview lasted for approximately one hour. However, some of the interviews
were made face to face, especially with the senior level managers to ensure that
the interviewees took this research seriously. Prior appointments were obtained
to meet the interviwee at job location during the interval, and care has been
taken not to interrupt the establishment's business practices. A few vendors were
met in their home or other locations convenient to the participants. Further,
during the interview, they were asked to interpret if they required more clarity
or left something unclear. Additional questions in terms of probing were made
if they required clarification.
Figure 3.2: Schematic representation of the data collection process employed in this study
Data collection
Primary data collection Literature Review (secondary data

collection)
Convenience sampling Development of Interview

sssasamsampl guide
Outsourcers: UK firms Outsourcing vendors: Indian firms

(n=10)Group A (n=10)Group B
Semi-structured interview
Source: Author (2013)
3.11. Validity and Reliability
Reliability ensures consistency while validity depends on the soundness of the

data collected based on design and methods (authenticity). The data collection
process ensures reliability and validity of the research and in qualitative
research is based on the subjectivity of the research. Although reliability and
validity is difficult to achieve in qualitative research, the credibility is enhanced
by the views of comparability, transferability and consolidation. The
comparability refers to matching of research results with the literature review
and reality, while the transferability means how well the results could be
transferred in another context and finally comparability is done by describing
the research methods and research subject as exactly as possible. In this case,
we ensure all the three, while formulating interview guide, description of the
whole research process and compared the results with actual settings and based
on the literature review. The honesty of the respondents dictates the reliability
of the research (Tracy, 2010). Therefore, administrators and employees from
outsourcing firms were selected due to their relevance for this study. Also, the
design of the study to measure data determines the validity (Marshall &
Rossman, 2011; Tracy, 2010). Additionally, the pilot study only ensures
trustworthiness of the questionnaire. Further, the guidelines to complete the
questionnaire will aid to ensure the validity of the study (Gary, 2009), In
addition, justification for each question in the questionnaire has been provided
in the table 1, and this reflects the content validity of the study. Content validity
indicates that the questionnaire measures appropriately what is intended to
measure.
3.12. Ethical approaches
Ethics are important as it ensures how the study needs to be conducted rather
than the way things are (Burton, 2000). The researcher has considered all
possible ethical issues at every stage of the studies (Burton, 2000). For example,
the researcher obtained informed consent from all participants prior to the
conduct of the study. Moreover, the researcher assured the participants
confidentiality by employing a coding system to hide the identity of the
respondents. Further, any personal information such as email id, mobile
number, address, etc were not collected by researcher. Moreover, the researcher
assured the participants that they have all rights to withdraw from the interview
at any time.
3.13. Informed consent
Consent from the participants is vital to the study and the researcher has
explained the participants the main objectives and motivation to make sure the
reliability of the research. Therefore, consent process was done in this study.
3.14. Interview textual analysis
All interviews were recorded and transcribed for further analysis and
process commenced during the interview phase and continues throughout the
transcription. Data was analyzed by content analysis (thematic analysis). Notes
took during the interview process were transcribed and coded based on the
themes of literature review. Firstly, analysis began with a quantification of
categorization to achieve basic understanding of the data and followed by
thematization to inspect the research question. Special focus was given to
themes that provided rich insights. Since the results were analysis in English,
translation was not required. Sample Analysis was shown below.
Sample Analysis
Interviewees were questioned about various HR policies and practices

implemented in the organization. The Majority of the Interviewees reported
that systematic procedures were followed for all HR related practices. HR
strategies were made clear by providing the employees with handbooks and
internet portals, enabling them to post their suggestions and feedback with
regard to all work related activities.
.We follow methodological procedures (INT_01_A) practiced effectively
.(INT_02_A).. established clear HR policies. provided with a handbook of
HR policies (INT_03_A).. an online tool post their grievances (INT_04_A)
follows well framed HR policies (INT_05_A) polices updated periodically
and intimated to our employees (INT_06_A) representative of the employees
to obtain their viewpoint (INT_07_A) are indispensable for any organization
(INT_08_A) well-developed HR policies conduct meeting to get
suggestions (INT_10_A)
3.15. Summary
The present study adopted qualitative, interpretive and inductive approach. Data
collection was done among both outsourcing vendors and customers from both
UK and India. Semi-structured interview guide was developed and interview
obtained was transcribed. Thematic analysis was used to analyze textual data.
The study had inherent limitations such as cross sectional study design,
qualitative approach, sampled only a few managers, but despite that focus is to
obtain rich information in order to answer the research question posed.
However, researchers attempted to reduce these errors as much as possible.
Chapter 4 Qualitative Analysis
4.0. Introduction
This chapter explains the outsourcing organizations and vendors
experiences of Human resource outsourcing, particularly to identify the
motives, benefits and challenges involved in the process from outsourcers and
vendors perspective. The researcher includes narrative descriptions to
demonstrate the individual perspectives of each participant. Further, coding
process was used to determine each outsourcers outsourcing experience with
vendors and examine whether outsourcers have sufficient policies, resources
and knowledge to address the issues involved. Finally, researcher introduces the
thematic analysis that categorized participants unique experience into the
conceptual schemes based on the research questions set.
1. What are the benefits and risks involved in HR outsourcing?

2. What are the challenges and issues faced by HR outsources and
Vendors during the process?
3. What are the effective practices adopted by outsourcing organizations
and vendors to minimize the issues?
Data Analysis
All interviews were recorded and transcribed for further analysis and process
commenced during the interview phase and continues throughout the
transcription. Data was analyzed by content analysis (thematic analysis). Notes
took during the interview process were transcribed and coded based on the
themes from literature review. Firstly, analysis began with a quantification of
categorization to achieve basic understanding of the data and followed by
thematization to inspect the research question. Special focus was given to
themes that provided rich insights. Since the results were analysis in English,
translation was not required.
4.1. Outsourcing companies Participants Profile.
In total 10 interviews were conducted, 10 interviewees are from UK

Outsourcing organization in which the following participants have participated.
Designation Total number of participants
HR country Head 1
Regional HR Manager 1
Procurement specialist 1
Associate HR Manager 1
Senior HR Manager 2
HR Manager 2
HR Regional Head 2
The majority of the participants were in the age group of 3055 years. Out of
the 10 participants, 9 participants were male and only one participant was
female. In addition, the majority of the participants are from mid-size firms with
a number of employees in the range of 5,000 and 10000. However, a few
participants are from large size firms with a number of employees in the range
of 55,00063,000. The following coding system was applied to differentiate
vendors from clients by. (INT_ 01_A), where the letter A at the end
represents the Group A that is Outsourcing Organization while (INT_01_B),
Letter B at the end indicates Group B that is Outsourcing Vendors.
4.2. Implementation of HR Policies and Practices
Interviewees were questioned about various HR policies and practices
implemented in their organizations. The majority of the Interviewees reported
that they give utmost importance to HR policies and in order to implement
them, systematic procedures were followed in their organizations for all HR
related practices. HR strategies were made clear in the organizations by
providing the employees with handbooks and with the help of internet portals
by which employees can post their suggestions and feedback with regard to all
work related activities.The HR policies will be reviewed periodically and
updated to all employees.
.We follow methodological procedures- (INT_01_A).., practiced HR

policies effectively by reviewing them - (INT_02_A), established clear HR
policies by providing employees with a handbook of HR policies-
(INT_03_A).. we use an online toolemployees post their grievances-
(INT_04A) follows well framed HR policies and - (INT_05_A) polices
updated periodically and intimated to our employees - (INT_06_A)
representative of the employees to obtain their viewpoint- (INT_07_A)
are indispensable for any organization so we follow them strictly -
(INT_08_A) practices well-developed HR policies conduct meeting to get
suggestions- (INT_10_A)
See appendix 2 for Table 4.1.
Figure 4.1: HR Policies and Procedures
4 4
3 3
3
Respondents
2 Effective
2
Handtool
1 Online/Portal website
1 Periodic updation of the policies
Conducting meetings
0
Effective Handtool Online/Portal Periodic Conducting
website updation of meetings
the policies
HR Policies and Procedures
4.3. Motives of Outsourcing Decisions.
The specific question was asked to interviewees about various motives

of outsourcing decision, especially how globalization influenced the
outsourcing decision. From the interviewee answers, it is revealed that due to
Globalization many firms are increasingly opting for HR outsourcing. The
major driving factors for HR outsourcing are low cost, The majority 6 out of 10
interviewees felt that cost control is the main motive for human resource
outsourcing. and others felt, availability of trained personnel, reducing work
load and to focus on core business are the motives of HR outsourcing.
Globalization and restructuring have increased the pressures Multiple

operative offices have increased- (INT_01_A) the legal regulations in
various countries - (INT_02_A) cost efficient and the company could
focus more on its core business- (INT_03_A) taking advantage of IT
advances- (INT_04_A) outsourcing for administrative purposes all
welfare related aspects- (INT_05_A) reducing business volatility-
(INT_07_A) outsourcing is panacea for all problems-(INT_08_A) it is a
profitable idea - (INT_10_A).
See Appendix 2 for table 4.2
Fig 4.2 Motives of HR outsourcing
reduce time 2
Motives of HR outsourcing
skilled employees 2
competitive advantage 3
low cost 6
legal requirements 2
reduce work load 1
0 1 2 3 4 5 6 7
Respondents
The figure 2 reveal that 6 of them responds to low cost followed by 3 of them competitive advantage, 2
of them reduce time, 2 skilled employees, 2 legal requirements and 1 reduce work load.
4.4. Strategic viewpoint of Outsourcing
When Interviewers were questioned about strategic viewpoint of outsourcing,

interviewees describe that outsourcing enables in raising the organizations
overall productivity, quality and flexibility. Outsourcing HR functions
facilitates the management to focus on the core business and business goals to
enlarge product range, productivity, marketing and promotion. Hence
outsourcing has become a strategic imperative for a firm helping in managing
the time and scope for planning and implementing their organizational
goals.Majority of the respondents felt that they were able to focus more on their
core activities as they dont have to deal with their routine HR activities any
more.
A strategic imperative to our company increases flexibility, productivity and

quality- (INT_01_A) data exposure can be minimized -(INT_02_A)
HR outsourcing is strategically aligned with the companys primary goals -
(INT_03_A)has increased the efficiency in recruitment- (INT_04_A)
possible approach to execute and restructure internal processes-
(INT_05_A) time consuming activities can be executed-
(INT_06_A)data processing, healthcare procedures can be facilitated by
outsourcing- (INT_07_A) offers soft-cost savings to the organizations-
(INT_08_A) adds value to the company -(INT_10_A)
See Appendix 2 for table 4.3.
Fig 4.3 Strategic viewpoint of outsourcing
Focus on core activities 4

Strategic view point of
outsourcing decisions
Added Advantage 2
Quality 2
Productivity 3
Organization flexibility 2
0 1 2 3 4 5
Respondents
4.5. Driving factors and frequently outsourced HR functions
Interviewees were asked about various driving factors of HR outsourcing.

The major reason for HR outsourcing is to dedicate time for strategic planning.
The most commonly outsourced HR outsourcing function are administrative
tasks, finance related functions and mass recruitments.
Well informed on the fares and discounts related to transportation allownaces

(INT_1_A) periodic feedback of employees are well- processed and
secured(INT_2_A) outsource recruitment process(INT_2_A) handle all
health covering schemes (INT_5_A) temporary staffing pay roll and other
associated procedures is handled (INT_7_A) outsourcing our
administrative tasks (INT_8_A) finance related functions(INT_9_A)
specific business functions achieving superior customer service and
productivity (INT_9_A)
Fig 4.4 Driving factors and frequently outsourced HR functions
Superior customer service and productivity 1
Driving factors of HR outsourcing
Finance related functions 1
handling administrative tasks 1
Payroll and other associated procedures 1
Handle all watch related schemes 1
Outsourcing recruitment process 1
Well maintained periodic feedback of 1
Well-informed with fares and discounts 1
0 1 2
Respondents
The above figure 4.4 reveals that equal 1 responded to each driving factor of HR outsourcing.
4.6. Benefits of HR outsourcing functions
Interviewees were asked about various benefits that they gain out of HR
outsourcing. The major benefits for HR outsourcing highlighted by the
interviewees are it reduces cost, helps to minimize risk by compiling with labor
laws and employment regulations, reduces time, reduces redundancy of work
and ensure professional documentation.
Decreasing redundancy of work (INT_1_A) Reduces high cost

basis(INT_2_A) efficient recruitment functioning (INT_3_A) eased in-house
HR functions focus on core HR functions like talent acquisition(INT_4_A
Updated with all regulations and beneficial schemes, (INT_5_A) best
management practices(INT_7_A) minimize risk in employment
regulations(INT_8_A) no need to invest in the infrastructure. (INT_10_A)
Fig 4.5 Benefits and HR outsourcing functions
3
2
Respondents
1 1 1 1
1
0
Decreased work Cuts down high Efficient Eased in house HR Updated with all
redundancy cost basis functioning functions regulations &
beneficial schemes
Benefits and HR Outsourcing functions
The figure 4.5 shows the number of interviewees mentioned the above benefits in their interviews.
4.7. Challenges and issues in outsourcing HR.
Interviewees were asked about various challenges and issues of

outsourcing. Selection of the appropriate vendor was the primary challenge
faced by various organizations since it is necessary to have a successful
association with them. Another major challenge is to identify the risk factors
and processing costs and to develop a cost efficient model that will suit to
both concerned parties.
Selection of appropriate vendor (INT_1_A), (INT_3_A), , (INT_4_A), getting

a consorted opinion on the vendors for outsourcing (INT_2_A) challenging to
establish the right alliance... in order to accomplish the companys mission,
visions and goals(INT_4_A) response time communication for
clarifications are compromised with certain vendors INT_7_A) challenges
in identifying the key metrics(INT_7_A)challenges in identifying the risk
factors for the company (INT_9_A) challenges in service costs(INT_10_A)
Fig 4.6 challenges and issues in HR outsourcing
4
3
3
Respondents
1 1 1 1 1
1
0
Selection of Challenges in Difficulty in Challenges Identifying the Delayed
appropriate identifying the understanding related to company's risk response time
vendor keymetrics the factors service cost factors and and poor
related to use assigning to the communication
satisfaction outsourcing for clarification
partner
Challenges and Issues in Outsourcing
The figure 4.6 reveal the number of respondents mentioning the above challenges in outsourcing.
4.8. Outsourcing and its impact on In-house HR team
Interviewees were asked about the impact of outsourcing on an In-house HR

team. Almost all interviewees have reported that though HR outsourcing has
enabled to reduce the workload, it has considerably created a negative impact
amongst the in-house employees which has affected their performance. Apart
from that communicating with the vendor company is another problem
addressed by the interviewees as the timings in the vendors country is
different.
Recruitment task should not be outsourced- INT_ (2)_A; have to constantly

interact with HRO vendors this is an additional task, timings in the vendors
locations is another problem- INT_(4)_A Decrease in the HR staff size in
organizations- INT_(5)_A often employees are recruited with
inappropriate skill and are difficult to get them trained- INT_(6)_A record
of grievances and feedback were overlooked -INT_(7)_Anegative impact
on in-house team -INT_(9)_A INT_(10)_A
Still few reported that they were able to focus more on strategic planning and
they did not find a lot of negative impacts on in- house HR team.
enabled to focus more on strategic planning and core functionalities

INT_(1)_A more comfortable to contact an outsourcing partner rather than
the in-house team INT_(8)_A
Interviewees were also asked about various challenges and issues of

outsourcing. Most interviewees stated that there are several challenges and
issues confronted by the management with regard to HR outsourcing. Their
inconsistent performance level, poor service quality, lack of expertise and
competency related to skill requirements and miscommunication are some of
the prime aspects that correspond to the issues related to outsourcing.
Service quality not satisfactory (INT_1_A)fluctuating (INT_4_A)

insufficient knowledge about skill requirements (INT_3_A) gap in
transferring the skill and knowledge (INT_5_A) challenges in conveying
information (INT_6_A) challenges to obtain a consolidated opinion
(INT_7_A) need to rework on the same task (INT_9_A)
Refer to Appendix 2 for table 4.8
However, there are few who report that they face issues and challenges in
outsourcing only to some extent, stating that: vendors credibility is questioned
at times requires further verification on conformation (INT_2_A)
sometimes vendors fail to offer best practices (INT_9_A)
4.7 Issues that are related to HR outsourcing

3
2 2 2
2
No. of Respondents
1 1
1
0
Reworking on same task Insufficient knowledge Challenges in coveying Challenges in obtaining Reworking on same task
about skill requirements information, affecting consolidated opinion
firm's productivity
The above fig 4.7 shows the total number of respondents mentioned the above issues in their
interviews.
See Appendix 2 for the table 4.8
When Interviewees were asked about various risks of outsourcing almost all the
interviewees have stated several issues risk factors that are involved in HR
outsourcing such as loss of flexibility, losing control over HR policies of the
organization, elaborate legal procedures, disclosure of the companys
confidential affairs and many more
Relationship between the employees and organization minimized -

(INT_1_A) influence on the in-house employment (INT_1_A) loss of
control over HR policies (INT_4_A) cross cultural differences between our
organization and the vendor (INT_6_A)companys confidential issues might
get affected (INT_3_A), (INT_8_A) losses track of the functions
(INT_5_A) affecting in house employee satisfaction (INT_9_A)
considerations is in the quality of service (INT_10_A)
See Appendix 2 for Table 4.10.
4.9 Risks in HR outsourcing
Service quality might get affected 1

Risks in HR Outsourcing
Affects in house employee satisfaction 1
Loss of control over HR policies 1
Lack of clear understanding between the

1
management and vendors
Company's confidentiality is affected 2
0 1 2 3
Respondents
The above figure 4.8 shows the total number of respondents mentioning the following risks in their
interviews
4.9 India as preferable HR outsourcing destination
Interviewees were asked about reasons for choosing India as outsourcing
destination. Several interviewees have described that that the availability of
highly skilled and competent professionals, prompt and reliable execution of the
work, low operational cost, low labor charges, rendering quality-oriented work
has been the prime reasons and aspects for choosing India as the a major
outsourcing destination.
Low operational cost and availability of skilled professionals (INT_1_A),

(INT_10_A) increased establishment of manufacturing units customer
support centres (INT_2_A) Indian IT people are highly professional safe
to make investments (INT_3_A) can get quality work and employees
willingness for overtime works if needed- (INT_4_A) fast turnaround time
(INT_9_A)
Fig 4.9 Interviewees reasons to choosing India as a their HR Outsourcing Destination.

7
6 6
6
5
Respondents
3
2
2
1
1
0
Low operational cost Availibility of skilled Safe to make Can avail quality
professionals investments work
Choosing India as a majot outsourcing destination
The above figure 4.9 shows the total number of respondents responded to reasons of choosing india
as outsourcing destination.
4.10 Outsourcing Vendors interview transcript:
Participants Profile:
In total 10 interviews were conducted in which Senior HR manager

(n=1), Regional HR Manager (n=2), Assistant Manager (n=1), Procurement
Specialist (n=1), Marketing Head (n=1), Associate HR Manager (n=1) Senior
HR Manager (n=3), HR Manager (n=2), HR Regional Head (n=1) were
included as participants. Figure 1 below presents the participants profile.
Majority of the participants are in the age group of 3055 years. All the
participants are male and majority of the participants are from mid-size firms
with number of employees in the range of 5,000 and 10000. However, a few
participants are from huge size firm with number of employees in the range of
20,00065,000.
Trend of HR outsourcing:
In order to understand the demand of HR outsourcing, the respondents have

been asked regarding the scope of business. Majority of the participants
indicated that the presence in their market is an evidence for the success which
reveals that there is a huge demand for HR outsourcing in India. At the same
time, few participants indicated the motive behind HR outsourcing.
Organizationsintend to advance and speedup the recruitment processto
reduce cost involved (INT_03_B).to negotiate with employees regarding
CTC( INT_04_B) processing healthcare facilities is difficulthence
outsourcing (INT _06_B).focus on core business activities. (INT _09_B)
to attain a competitive edge (INT_10_B).
In addition, a few vendors indicated their effective practices of outsourcing.
we learn and improve each time with the requirements to match

expectations (INT_05_B)collect information on Government
regulationsprepared with the essentials. (INT_07_B)offering assistance
to organization from initial stage by understanding requirements and
minimizing time to comprehend those requirements (INT_08_B).
The vendors indicated that they update their process regularly and are compliant
with the rules and regulations of Government. Moreover, they indicated that
offer customized services based on outsourcing organizations requirement and
assist them by reducing their work load and thereby enable organization to
focus on their core activities. All these clearly indicate the trend as well as
motives for outsourcing. However, one of the participants revealed the
challenges involved in the HR outsourcing process.
The methodology for process improvement is challenging.to meet their

expectations (INT_B_05) (Challenges)
The interviewee indicated that updating the process based on demand is a

challenging task. When asked about the challenges involved in the outsourcing,
most of the respondents indicated that miscommunications and confidentiality
issues are the major issues faced by outsourcing vendors. The other issues are
meeting customer demands, maintaining response time, privacy and
confidentiality issues, quality issues and legal issues.
response time or miscommunications (INT_B_01; INT_B_04; INT_B_05),

confidentiality issues (INT_B_02;INT_B_03; INT_B_04), quality issues
(INT_B_02); iteration rate, legal issues (INT_B_07), limited control and
flexibility (INT_B_09; INT_B_10).
4.10 Interviewees response to Effective HR Practices
4
4
Respondents
2 2
2
1
1
0
Earned a competitive Speeds up recruitment Cost reducation Focus more on core
edge in the market process business aspects
Effective HR practices
The above figure 4.10 shows the number of respondents mentioning the above Effective HR
practices inn their interviews
4.10 Issues faced by the organizations when outsourcing.
Outsourcers limit their flexibility 1

Issues faced by organizationswhile
Apprehension on governmental policies 1

outsourcing
Iteration rate 1
Confidentiality Issues 3
Misommunication 2
0 1 2 3 4
Respondents
See Appendix 2 for Table 4.11
HR functions play a significant role in the organizational strategies since human

resources are assets considered as the most precious assets for any business. The
day-to-day functionalities, organizational strategies and objectives are
determined by the Human Resources.
Soft skills training knowledge updated skill set for the employees (INT_1_B),
(INT_5_B), (INT_7_B) recruitment and training(INT_2_B) primary
driving factor building a strong human capital(INT_3_B) leadership
development programs (INT_4_B), (INT_6_B) Innovative workforce
management(INT_8_B) staffing, training and development, employee
engagement(INT_9_B), (INT_10_B)
Fig 4.11 Role of HR in influencing Organizational strategies
Innovative workforce management 1

Role of HR in influencing organizational strategies
Leaderdship Development programs 2
Efficient Recruitment functionalities 3
Training in Knowledge Updated Skills 2
Soft Skills Training 2
0 1 2 3 4
Respondents
The above fig 4.11 shows the total respondents responded to above organizational stratagies
See Appendix 2 for the table 4.12.
Interviewees were asked about commonly outsourced HR activities. Majority of

the interviewees have answered that bulk recruitment functions, payroll
procedures, welfare related schemes, food and transportation schemes and
temporary staffing solutions are the prime HR functions that are exclusively
relied upon the outsourcing vendors.
Contractual agreements compensation programs legal regulations food

and transport contracts (INT_1_B) , (INT_7_B) bulk recruitment function
background verifications payroll procedures temporary staffing solutions
(INT_3_B), (INT_9_B), (INT_8_B) (INT_10_B) (INT_4_B)welfare related
schemes (INT_5_B), (INT_7_B)
See Appendix 2 for the table 4.13.
4.12 Most Commonly Outsoursourced HR functions
Outsourcing Health benefit schemes 2

Commonly outsourced HR functions
Temporary staffing procedures 3
Background verification 2
Outsourcing payroll proecdures 4
Bulk recruitment functions 3
Food and Transportation schemes 2

Outsourcing contractual agreements,
2
compensation programs
0 1 2 3 4 5
Respondents
The above figure 4.12 shows the number of respondents responded to most commonly outsourced HR
functions.
Majority of the interviewees expressed their views that there are few issues and
challenges that are faced by the outsourcing vendors which includes payment
issues, salary crediting issues, errors in performance evaluation,
miscommunication issues, and challenges faced in data protection and privacy
policies and many more
But on the contrary, some have addressed that none of their clients experience
any issues related to their outsourcing services- All services are executed in a
well-organized manner and they put in their best beyond efforts providing
complete solutions for all their management related issues.
Payment issues (INT_1_B), (INT_4_B) errors in candidate details salary

crediting(INT_3_B) performance measurement parameters vary
(INT_5_B) Translating the organizations objectives (INT_6_B) Data
protection and privacy laws (INT_7_B) timeline not provided lot of
misunderstandings (INT_8_B) mutually agreement cost model (INT_9_B)
However, few have reported that:
Our clients are pleased and satisfied with us for their HR functions
(INT_2_B) Well-documented legal agreements helped us to avoid these
kinds of issues (INT_10_B)
4.13 Issues Faced by HR vendor companies
Timeline not provides 1

Issues faced by outsourcing vendors
Issues in data protection & Privacy Policies 1
Miscommunication 2
Errors in Salary Credition 1
Errors in Candidate Details 1
Payment Issues
2
0
1
2
3
Respondents
The above figure 4.13 shows the number of Vendors mentioning the above Issues faced by HR vendor
companies
See appendix 2 for Table 4.14 .
Most of the interviewees have addressed that providing testimonials and success
stories of their prospective clients would definitely add on to their marketing
strategy. Other factors providing excellent customer services, meeting
deadlines, following strict recruitment policies would also play a vital role in
building an effective marketing strategy.
Testimonials and successful practices (INT_1_B), (INT_2_B), (INT_4_B),

(INT_8_B) follow stringent recruitment policies maintain good
relationship with all our clients (INT_3_B) methodologies and the suggested
alternatives in relate to client requirements(INT_5_B), (INT_7_B) subject
analysis experts (INT_6_B) 100% customer satisfaction low turnaround
time(INT_10_B) Excellent customer service(INT_9_B)
4.14 Marketing strategy adopted by outsourcing vendors
Marketing strategy adopted by outsourcing

vendors
2 Record of testimonials & best

4 practices of prospective clients
4 Providing ultimate client
satisfaction
Low turnaround time
3 Providing customized services

3
Maintain Holistic relationship

1 with clients
2
1
The figure 15 reveal the marketing strategy adopted by outsourcing vendors 4 of them respondents
mentioned Record of testimonials & best practices of prospective clients in their interviews followed
by 3 of them responds providing customized services, 2 of them responds providing ultimate client
satisfaction, 2 of them responds maintain Holistic relationship with clients and 1 of them respond low
turnaround time.
Interviewees were asked about various challenges and issues of outsourcing.

Most interviewees have reported that there are several challenges faced by the
outsourcing vendors while rendering their services for developed countries,
some of which includes, communication barriers, technological factors, cultural
and legal differences, stringent work policies, high cost range, working on shift
basis and many more
Training and interview patterns more stringent sophisticated evaluation and

assessment procedures (INT_1_B) professional etiquettes (INT_2_B)
work on a shift basis (INT_3_B) cultural and legal differences
(INT_4_B) work policies and ethics are different (INT_5_B)Language
Barrier (INT_6_B),(INT_9_B),(INT_7_B) implementing new methodologies
(INT_7_B)(INT_8_B) Huge Pay )(INT_10_B)
See appendix 2 for Table 4.15.
4.15 Challenges aced by HR outsourcing vendors from developed countries
Challenges faced by HR outsourcing vendors
from developed countries
2 Stringent in work policies and
ethics
4 Cultural and legal differences
1
Work on shift basis
Stringent training & Interview

patterns
Sophisticated assessment
procedures
Language barrier &
3 1 miscommunication
High cost range
1 Challenges in execution of new

methodologies
1
2
The figure 16 reveal the challenges faced by HR outsourcing vendors from developed countries 4 of
them responds to Stringent in work policies and ethics followed by 3 of them responds language
barrier & miscommunication, 2 of them responds Stringent training & Interview patterns, 2 of them
responds challenges in execution of new methodologies, 1 of them respond cultural and legal
differences, 1 of them respond work in shift basis, 1 of them respond sophisticated assessment
procedures and 1 of them respond High cost range
According to HR outsourcing vendors, there is not much risk with regard to HR

outsourcing to developed countries. However, there are chances of outsourcers
to undermine the services provided by vendors of developing countries.
Undermine the capabilities (INT_2_B) convince the multinational

companies organizations legal and governmental policies (INT_5_B)
change in authority or in the case of acquisitions (INT_5_B) provide less
freedom to execute procedures (INT_7_B) Customer service quality
constantly maintained at high standards (INT_8_B)
Also, some have addressed that process of the organization the requirement is
well outlined (INT_1_B) not faced any risks(INT_3_B) made a good
relationship with the clients trust and their customer satisfaction
(INT_9_B)
See Appendix 2 for Table 4.16.
4.17 Risks Faced by the HR outsourcing vendors from the Devoloped countries
Challenges in
convincing the
MNCs and earning
their trust
3
1
Providing less
Change in
freedom to
authority or 0
execute
acquisition
procedures
Customer service
quality to be
constantly
maintained
4.11 Summary
This chapter presents the interview data using thematic analysis

highlighting various critical drivers, benefits, challenges, and risks of Global IT
Outsourcing. In total 20 interviews were conducted, out of which 10
participants represented outsourcing organizations and 10 participants
constituted vendor organizations.The interview findings revealed various
benefits, risks and challenges involved in HR outsourcing.
Participants from outsourcing organsiations indicated that low cost

operation is the major benefit as well as driving factor for outsourcing. In
addition, competitive advantage, increased quality and flexibility are the major
benefits of outsourcing. The major challenge faced by outsouring vendors are
found to be vendor selection and identifying outsourcing functions.
Similary, from the interview findigs with outsourcing vendors, it is

clearly identified that miscommunication and delayed response time are the
major challenges faced by outsourcing vendors. The other issues faced by
outsourcing vendors are payment issues, stringent work practices, assessment
procedures. The following section presents the discussion and conclusion based
on the findings obtained in this chapter.
Chapter 5. Discussion
The central question of this study was to identify the advantages and
risks and challenges associated with HR outsourcing and to determine the
effective measures adopted by organization to mitigate them. Outsourcing is
increasingly adopted by organizations than ever before and as a result, there is a
huge demand for structured information that guide them to identify benefits,
challenges, and effective practices related to outsourcing. Even though several
studies have focused on the benefits and risks associated with outsourcing most
of them focused only on the outsourcers perspective. Moreover, there were
only limited information on the challenges faced by outsourcing vendors. In
order to fill this gap, this study attempted to investigate the risks involved in
outsourcing from both vendor and outsourcers perspective. This will enable
both outsourcing organization and vendors to have an in-depth understanding of
outsourcing and enable them to effectively handle inherent challenges involved
in outsourcing. The findings of this study are discussed in detail as follows:
5.0 Core motives and benefits of HR outsourcing
Outsourcing possesses several advantages and hence a range of motives

and benefits exist for organizations to adopt outsourcing.
5.0.1 Low cost operation
The interview findings of the present study indicated that cost reduction
was found to be the major driving factor for respondents to adopt outsourcing.
In the present study, the majority of the outsourcing organizations indicates that
outsourcing helps to reduce the average unit cost of product/service sold by an
organization. Moreover, interviewees indicate that outsourcing enables
organizations to utilize the skilled expertise at lesser costs. In addition, through
outsourcing organizations are able to control infrastructure and support systems
cost. All these findings clearly indicate that organizations adopt outsourcing
mainly to reduce cost. Similarly, previous studies on outsourcing (Csoko, 1995;
Domberger, 1998) have also indicated that cost reduction is the major driving
factor for outsourcing.
5.0. 2 Competitive advantage
Followed by cost reduction, competitive advantage is another driving

factor for organizations to adopt outsourcing. In the present study, the
respondents indicate that outsourcing HR functions enable organizations to
attain competitive advantage by focusing on core motives. In the present study,
both vendors and outsourcers revealed that organizations employ outsourcing to
reduce work load thereby focusing on core motives. This can also be correlated
with the fact that the majority of the commonly employed HR functions is
redundant and time consuming functions such as bulk recruitments,
administrative tasks, evaluation procedures, periodic assessment of employees
and Payroll functions. By outsourcing these kind of redundant and time
consuming functions, organizations can focus on core activities and thereby
attaining competitive advantage. In addition, through outsourcing organizations
have access to skilled expertise which helps in attaining competitive advantage.
The finding of this study is also consistent with the results of previous studies
examining the benefits of outsourcing (Vanson, 2001; Weidenbaum, 2005).
5.0.3 Increased flexibility
In the present study, most of the respondents indicated that outsourcing

offers flexibility to the organization as it is easier to terminate the contracts
owing to poor delivery than changing the employee. HR outsourcing enables
managers not only to select the best outsourcing vendors, but also offers better
scalability (faster scale-up/scale-down capability). This is also consistent with
the findings of Belcourt (2006) who proposed that outsourcing provide
improved organizational flexibility.
5.0.4 Increased quality
In the present study, the major strategic reason for organizations to adopt
outsourcing is to utilize vendors specialized technology and processes resulting
in better quality products and services. The outsourcing organizations indicated
that outsourcing results in quality improvement through better quality
production via advanced technological skills. Moreover, outsourcers indicated
that outsourcing enables them to avoid technology obsolescence and to keep
them up-to-date with advanced technology. Thus, it is clearly evident that
outsourcing results in added value to the company thereby resulting in improved
quality. These advantages also correlate with the results of previous findings
(Belcourt, 2006).
From the study findings, in addition to the above-mentioned benefits, the

other benefits of outsourcing are found to be efficient processes, ease of in-
house HR functions, legal requirements, best management practices and reduced
infrastructure investment.
5.1 Challenges and issues involved in HR outsourcing
The challenges involved in HR outsourcing are found to be different for

both vendors and outsourcers. The following section discusses in brief the major
challenges faced by both vendor and outsourcing organizations.
5.1.1 Vendor selection
The study findings indicate that vendor selection is the major challenge
faced by most of the outsourcing organizations. This is because vendor selection
involves identification and evaluation of vendors and making contracts with
them. Moreover, uncertainty exists in whether the selected vendors fit with the
outsourcing organizations culture and meet their technological demands to
produce consistent quality
This result collaborates with the results of Wadhwa and Ravindran (2007)
and Lacity and Wilcocks (1998) who also studied the major challenges faced by
HR outsourcing organizations. This clearly indicates the need of structured
framework to assist outsourcers in selecting vendors. Future studies can focus
on developing structured framework in vendor selection.
5.1.2 Selecting outsourcing functions
Identifying in-house and outsourcing functions and determining the risk

factors involved in outsourcing is another major challenge faced by HR
outsourcers . This is because the outsourcers find difficulties in setting limits for
each task, identifying risk-prone area and defining responsibilities and
performance monitoring mechanisms. These findings are also in-line with the
results of Dhar and Balakrishnan (2006). However, Dhar and Balakrishnan
(2006) focused only on two companies. Thus, these previous findings have now
been replicated in the present study using a sample of twenty companies.
5.1.3. Inconsistent quality and performance
According to the interview findings, the majority of the outsourcing

organizations faces trouble with vendors in terms of insufficient service quality,
inconsistent performance and lack of technical competence. Moreover,
outsourcers revealed their difficulties in delivering their product on time. These
challenges are found to be similar with the results of Alexandrova (2012) 1
however, they just studied the challenges related to IT outsourcing. Therefore,
the present study successfully replicated the present study findings by focusing
on HR outsourcing.
5.1.4 Privacy and confidentiality of organizational data
The study findings revealed that Privacy and confidentiality are the major
risk involved in HR outsourcing. The outsourcers are found to be uncertain
regarding their confidentiality of data. Moreover, this relates to the security risk
1
IT Outsourcing Risks: Empirical Evidence from
Bulgarian Service Providers
factors of outsourcing such as a lack of reliability among service providers, data
security issues and compliance issues. Similar results are obtained in the
previous study findings of Alexandrova (2012).
5.2 Challenges and issues faced by vendors
5.2.1 Delayed response time and miscommunication
Both vendors and outsourcing organizations indicated that delayed

response time and miscommunication are the other common issues involved in
HR outsourcing. This occurs mainly because of a mismatch in national and
organizational cultures and value which creates a major challenge for both HR
outsourcing organizations and vendors. In the present study, the outsourcing
organization stated that miscommunication results in less satisfaction and
poorer quality. Moreover, communication gap between outsourcers and vendor
results in unclear statements regarding processes, objectives, and timelines. This
also results in poor coordination between both parties. Therefore, proper
training should be provided for both parties to overcome this issue. The results
of this study clearly indicate the need of proper communication and systems to
improve the effectiveness of outsourcing. The results of the present study are in-
line with the previous studies (Azeem & Khan, 2012) suggesting that
miscommunication and delayed response time are the common challenge faced
by both vendors and outsourcing organizations.
5.2.2 Stringent work practices and assessment procedures
The vendor has to adhere to the stringent work practices of outsourcing

organizations, which forms a major challenge for the vendor. Moreover, the
study results reveal that Indian outsourcing vendors face difficulties in work
arrangements and organizational readiness for outsourcing. Most of the vendors
indicated that developed countries tend to underestimate the quality of Indian
outsourcing vendors and hence they face difficulties in the performance
assessment practices. This often imposes a major barrier between Indian
outsourcing vendors and developed countries. The result of the present study is
consistent with the results of previous studies (Ranganathan & Balaji 2007)
investigating the challenges faced by vendors.
The other challenges faced by vendors are adhering to high quality

standards, payment issues, compliance with data protection regulations and
privacy and confidentiality issues.
5.3 Effective outsourcing practices
5.3.1. Effective practices of outsourcing organizations
From the study, it is clear that a range of methodological procedures is

followed by outsourcing organizations to effectively handle their HR
outsourcing practices. In the present study, the major effective HR outsourcing
practices employed by the majority of the outsourcing organizations include
online portal or website specifically dedicated for outsourcing activities. Usage
of online portal can help in increasing coordination among vendors and
outsourcing organizations. Another effective strategy adopted by outsourcing
organizations are periodic updating of HR policies using feedback from both
parties. In addition, handbook of HR policies and monthly meetings are other
effective outsourcing approaches followed by outsourcing organizations.
5.3.2. Effective practices of vendors
The effective practices implemented by most of the vendors include

marketing strategies to increase their businesses. The major effective practices
of vendors include employing testimonials and customer success stories. This
will not only help to improve their image but also trust between outsourcing
organizations. This in turn enables vendors to overcome the uncertainty among
outsourcing organizations in terms of their efficiency. Moreover, the vendors
indicated that they focus on low turnaround time and adhering to deadlines.
This increases vendors efficiency as well as increases customer satisfaction. In
addition, the other effective HR outsourcing practices employed by vendors are
offering customized services, focus on customer satisfaction and maintaining
holistic relationships with the client.
Chapter 6 Conclusion
The present study attempted to identify the benefits in addition to various

challenges and risks involved in HR outsourcing from the perspective of both
Indian vendors and UK outsourcing organizations. The study findings indicate
that low cost operation and competitive advantage are the major core motives
for organizations to adopt HR outsourcing. The other major benefits of HR
outsourcing are to attain improved quality and organizational flexibility.
In terms of outsourcing issues, the most common issue faced by both HR

outsourcing organizations and vendors is miscommunication and cultural
differences. Miscommunication and cultural differences imposes a major
challenge for both parties and hence proper training should be provided to both
parties.
The study results reveal that the challenges faced by outsourcing

organizations are different from vendors. According to outsourcing
organizations, vendor selection is the major challenge faced by outsourcing
organizations. Vendor selection is a crucial factor as it determines the
effectiveness of outsourcing. The other major challenges faced by HR
outsourcing organizations are identifying in-house and outsourcing functions,
setting limits for each task, determining performance monitoring mechanisms,
defining responsibilities for each party and identifying major risk prone areas
involved in HR outsourcing. On the other hand, the most common challenge
faced by vendors is ensuring quality work practices and adhering to work
practices.
Moreover, the study results indicate that privacy and confidentiality

issues are the major HR outsourcing risk factors for outsourcing organizations.
The other common risk factors involved in HR outsourcing organizations are
loss of control over HR policies and negative impact among in-house
employees. On the other hand, for vendors, the risk factors involved in HR
outsourcing are issues related to payment, performance assessment and
compliance with data protection rules and regulations.
The study results demonstrate that online portal, website for outsourcing
activities, regular meetings and periodic assessment of outsourcing policies are
some of the effective practices adopted by HR outsourcing organizations.
Thus, this study concludes that outsourcing definitely offers benefits to

both parties, provided they offer effective training to all employees and
incorporates effective outsourcing practices. This study provides a detailed
insight regarding the challenges faced by vendors and enable outsourcing
industries to improve the outsourcing practices.
6.1. Limitations and future studies
The following are the major limitations of this study:
1. The research methodology carried out in the current study was cross-
sectional qualitative study employing semi-structured interview method of
data collection to determine the major challenges involved in HR
outsourcing. Despite of the fact that a cross sectional study enables to
collect data from a huge group of people it fails to assess cause and effect
relationship. Therefore, further studies should employ longitudinal study
design to identify various benefits and challenges involved in HR
outsourcing.
2. The major limitation of this study is limited in sample size. This study
employs only 20 participants (n=10 vendors and n=10 outsourcing
organizations). Therefore, future studies should employ huge sample size.
3. This study employed, semi-structured interview method of data collection.
The major limitations of this data collection method are that the
interviewees may hesitate to reveal all the challenges and issues faced by
them in order to maintain the esteem of their company. Hence, future
studies should employ both survey and interview method of data
collection so as to improve the reliability of the study results.
4. This study determined the challenges and risks of HR outsourcing
eliminating other interesting inter-group effects. Hence, future studies
should assess whether the challenges differ with various outsourcing
activities.
5. This study is limited by focusing only on the outsourcing activities
between India and UK. Hence, future studies should whether the benefits
and challenges vary with other countries.
6.2 Recommendations
This study offered clear insights regarding the various risks and
challenges. Our study focuses on the nascent area of IT outsourcing vendors.
We examine the issues from the standpoint of IT outsourcing vendors in India,
currently the primary destination for IT off shoring.
6.3. Making an outsourcing decision
In making outsourcing decision, it is very important to know the strategic

significance and constructive steps that will be taken to outsource the process.
The study finding clearly reveals miscommunication is the major reasons for
many of the HR outsourcing issues. Hence, outsourcers should provide adequate
training to improve the skills required in efficient management of outsourcing
activities. Training and communication help to reduce resentment or resistance
(Foster, 1999). Further research is required to ensure that the outsourcing
strategy will fulfill the organization or business financial goals and business
objectives and need to know if the vendor marketplace can withstand and
exceed the current level of service standards. It is also important to concentrate
on the timing of the change and process of outsourcing.
6.4 Managing relationships and contract
It is very significant for companies to actively and constantly administer

and manage the relationship and contract with the service provider.
Recruitment, training and general HR issues are created for many organizations.
At the micro-level, workers are willing to switch over to other jobs and
employers, resulting in higher labor turnover, which also increases the
transaction costs for employers, and personal disruption for the individuals
concerned. There is a significant change in the structure of the economy,
manufacturing and extractive sectors being much less important than a
generation ago, with this increased activity in private and public services today.
This has implications for education and training policy and employment
prospects for existing and potential workers, particularly, such as graduates in
higher education. So making the providers knowing the clients ambitions,
strategic discussions and plans on a regular basis will help in achieving
competitive advantage for a buyer.
6.5. Major risk in HR outsourcing
Human Resource Outsourcing is a great tool to achieve competitive

advantage as the company can concentrate on core process by outsourcing non-
core processes. In the present growing business trends are seeking to be more
accustom to a more volatile global economy, which can be seen by the
increased foreign direct investment in the form of outsourcing. Large
operations, including lack of cost effectiveness, large share device center and
rapidly redeploy as different market matures. Moreover the outsourcing is used
to reduce the overall costs and provide other benefits where oversight and
feedback are the paramount to a successful outsourcing operation. Any time the
company may need the change in the strategy and their outsourced vendors also
no longer have the same expectation and goals. Hence outsourcing remains an
effective tool for businesses to focus on their strategic goals by reducing cost.
When the contract are already been made, the organization has to maintain the
cultural difference for the structure overview tools.
6.6 Establishing a governance structure
Creation of a governance structure that has effective organization and

reciprocated gain is forever been a key accomplishment in outsourcing.
Numerous HR implications are arising from outsourcing, where the legal issues
are considered in subcontract of the in-house activity includes the transfer of the
regulations. The issues associated with the control and the sub contracts must be
taken into account. An implication arises at the level of regulation of the
performance. Performance is not regulated through a typical contract of
employment along with the outsourcing, but it can be managed through a
commercial contract and the service level agreements. The implications are also
there for the job security and work intensification within outsourced
organizations.
6.7. Selecting a service provider
It is only possible to get the successful outsourcing arrangement only if

the vendor fits the company exactly. Outsourcing must be done carefully,
systematically, and with explicit goals and expectations. Sensible reasons to
consider outsourcing include both strategic and tactical concerns on both a
department and organizational level (Casale, 1996; Corbett, 1999). A good
choice of outsourcing partners contributes for successful organizations, which
should be selected based on their expertise in the operation being outsourced
and their cultural fit with the firm. Providing adequate training skills to manage
outsourcing activities and to negotiate a sound contract. Providing managers
with skills that will enable them to adapt to other cultures and work with other
managers may be very important to ensure the success of outsourcing
(Sinderman, 1995). A service provider can also utilize technology to ensure
transparency to clients as to demonstrate how they are functioning and
upholding quality standards. Failure to understand the terms and regulations
will bring the complications and risks to the organizations. It is very important
for the organizations getting ready to outsource to know how the providers
support and manage regulatory compliance.
6.8 Strategies to avoid the risks in HRO
Even though outsourcing Human- resource is a common practice in the

present business world, it is very important to have a careful groundwork and
monitoring to get full advantage from it. Developing a comprehensive plan
outlining detailed expectations, requirements, and expected benefits during all
phases of outsourcing activities may be the key to successful sourcing efforts
(Guterl, 1996). The major clearly the understanding of such issues is important
to the vendors, but also to the clients in order to maintain an effective dyadic
relationship.
6.9 Future Research Opportunities
Future research should focus on the longitudinal study design for

identifying various benefits and challenges involved in HR
outsourcing and also ensure to employ huge sample size.
The Interview method should include both survey and interview
methods to improve the reliability of the study.
Research to quantify the potential risks in HR outsourcing for
organizations in the UK and other countries.
The development of an HR core / noncore matrix / methodology to
assist organizations to accurately identify what the core, risk initiating
processes or process elements are.
The identification of effective methodologies and tools to measure HR
Risk management.
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Appendix:1
INTERVIEW QUESTIONNAIRE FOR OUTSOURCING ORGANIZATION
Background Information
Respondent No: 1 Name: Aron Paul
Designation: HR Country Head Age: 50 years
Type of Organization: Kier group of construction Sex: Male
Total no of employees: 16,000
Description:
Employee:
Aron Paul is a Senior HR manager in the Kier group of construction UK. He started
his career in the company in the year 1998 as a HR and he is now HR Country Head for the
company. He has significant experience in handling wide variety of legal and regulatory
issues, having advised a number of clients in the construction sector.
Company Profile:
Kier Group of construction was started in the year 1928 by Olaf Kier. The company is
one of the early pioneers in the domain of design and construction. The company has more
than 16,000 people globally and has annual revenue of 2.8bn. Kier provides a variety of
services in terms of building and civil engineering, support services, commercial property
development, structured property financing and private and affordable housing. Kier group
has outsourced Part of their HR activities to a HR management vendor in India.
Interview:
Mr. Aron Paul is one of the key members of the renowned company so I took prior
permission from him for an interview. Despite of his busy schedule, he agreed to answer my
questions. It was 4:30 pm and I met him in his office for the interview.
Me: Sir, shall I start the interview?
Aron Paul: Yes, of course.
Me: How would you describe the execution of HR policies and practices in your
organization?
Aron Paul: Well, the time constraints involved in performing the multifaceted roles and
responsibilities of HR are challenging while executing HR duties. However, we follow
methodological procedures for all HR related activities.
Me: In your view what are the core motives that have influenced outsourcing decisions?
Aron Paul: The phenomenon, globalization and restructuring have surmounted the
pressures on HR department and have added to its complexity. Multiple operative offices
have increased the need for outsourcing HR related activities.
Me: From a strategic viewpoint, how do you view Outsourcing as an initiative?
Aron Paul: Outsourcing has become a strategic imperative to our company and it allowed us
to concentrate more on productivity and quality rather than our regular HR concerns. The
major objectives of the organization can be attained cohesively using strategies when other
administrative functions are outsourced.
Me: Which HR functions did you perceive required Outsourcing and what influenced
your decision?
Aron Paul: The booking procedures, fare comparisons, accommodations, currency
conversions will be executed better when outsourced as they are well informed on the fares
and discount and can even negotiate better.
Me: Would you describe your HR outsourcing function as successful? If yes, in what
ways has it benefited the organization?
Aron Paul: Yes of course, outsourcing helps in decreasing redundancy of work and provides
more professional documentation, eliminating manual record maintenance replaced with
efficient processes.
Me: What challenges did you face in order to outsource your HR functions?
Aron Paul: You see, challenges will exist in each and every step in the outsourcing process.
We confront challenges mainly in selection of appropriate vendor since it is imperative for
successful alliance that a mutual agreement exists. The owner of the outsourcing agency, if
changed poses a problem in contracts and also alters the relationship and payment involved.
Me: How did HR outsourcing affect your HR team in terms of function?
Aron Paul: The HR outsourcing helped us to concentrate more on strategic planning and
development of the organization rather than concentrating on our regular HR routines. We are
now able to focus on the core functionalities in order to improve the companys performance
and service quality.
Me: Has your organization faced any issues related to HR outsourcing? If yes, describe
the instances?
Aron Paul: Yes we had a few issues in the beginning, the service quality that our vendor
company had provided is not up to our mark, as our HR vendors failed to understand our
exact requirements our work got delayed. It not only wasted our time but also increased our
budget for that project, that intern affected our customer satisfaction.
Me: What were the risks that you had to work with during HR outsourcing services in
your organization?
Aron Paul: The rapport between the employees and the organization is minimized due to the
contracts and the organization is unable to effective understand and interpret the requirements
of the employees including their perception of corporate values, beliefs and standards.
Me: Why do you choose India as your HR outsourcing destination?
Aron Paul: well the main reason is low cost and availability of skilled professionals. Though
the use of software/ hardware is lesser, more man-hours compensate for the work involved
and are open to adopt updated measures for improving the quality of work.
Respondent No: 2 Name: Johnson
Designation: Regional HR Manager Age: 50 years
Type of Organization: Logicalis Sex: Male
Total no of employees: 10000
Description:
Employee:
Mr. Johnson is the Regional HR Manager in Logicalis . Mr. Johnson joined in the
company in 2004 as a HR executive and he became the regional HR manager in the year
2011. He has significant experience in directing change management initiatives through
awareness creation, developing strategies to improve employee engagement simultaneously
assessing the employee capabilities.
Company Profile:
Logicalis is an international IT solution and managed services provider which
started in 1988 as Logical Networks Ltd in UK. The Logicalis Group operates in Europe,
Asia Pacific, North America and South America and generates annual revenue of over $1.4
billion. The Logicalis Group provides services in data centre and cloud services, business
analytics, managed services, communications and collaboration.
Interview:
Mr. Johnson is the regional HR manager of a renowned company who is very busy
with his work schedule. Regardless of this busy schedule, when I requested him for an
interview, he immediately agreed.
Johnson: Oh, Sure.
organization?
Johnson: According to me, execution of HR policies can be practiced effectively and the
policies need to be reviewed on periodic basis to adapt to the organizations development.
Me: What are the core motives that have influenced outsourcing decisions?
Johnson: If you ask me that, the legal regulations in various countries and compliance
directives have made it complex for HR to implement them in the organization. Such
requirements call for specifically skilled personnel with knowledge.
Johnson: As per our company perspective, the information or data exposure can be
minimized as the outsourcing party will be held responsible for such conditions for which
greater protection will be exercised by the vendor.
your decision?
Johnson: Surveys, evaluation procedures and periodic feedback of employees are well
drafted and the data collected, are processed and secured to provide information or report
from which strategic decisions can be planned rather than spending much time in formulating
and analyzing these procedures involved.
Johnson: Definitely, to carry out all the functions of HR requires a team of HR professionals
which is not feasible at developmental stages, so only the services required are outsources
instead of recruiting professionals full time at high cost basis.
Johnson: The challenges we are facing in terms of getting a consorted opinion on the
vendors for outsourcing.
Johnson: If I am analysing that factor, there is not much impact in the HR team functions;
still certain functions like training, motivation for employees are better carried out by in-
house HR personnel.
the instances?
Johnson: At some extent, the vendors credibility is at times questionable and requires
further scrutiny for confirming the information provided.
your organization?
Johnson: Outsourcing might produce better services but are not likely to affect manpower
but influence the internal employment.
Johnson: The reasons to choose India for outsourcing HR activities is due to the increased
establishment of manufacturing units, administrative or customer support centres for
international organizations in India to gain proximity to the customers.
Respondent No: 3 Name: David Cooper
Designation: Procurement specialist Age: 50 years
Type of Organization: Electron technology Sex: Male
Description:
Employee:
Mr. David Copper is the Procurement specialist in Electron Technology. Mr. Cooper
worked in various companies and has 20 years of working experience. Initially, he started his
career as a commercial trainee and gradually he has grown up to the level of Procurement
specialist. His career in Electron technology started in November 2012. He has significant
experience in cost reduction, strategic sourcing, supplier evaluation, procurement, electronics,
and supplier evaluation and so on.
Company Profile:
Electron is a global technological player headquartered in the United Kingdom.

The company operates in America, Middle East & Africa, and Asia pacific. The Electron
provides design, manufacture and market innovative technology products. The services can
be found in various areas right from scientific and medical to the industrial and commercial
arenas.
Interview:
Mr. David Cooper is a Procurement Specialist of well-established firm in London.

Regardless of this busy schedule, when I requested him for an interview, he immediately
agreed.
Cooper: Of course.
organization?
Cooper: For me, executing HR policies is vital for any company. In our company, we have
established clear HR policies and every employee is provided a handbook of HR policies
which are also available on our internal portal.
Cooper: Following the 2008 recession, our company decided to outsource certain HR
functions since it was cost efficient and the company could focus more on its core business.
Cooper: Outsourcing HR functions in our company have enabled the management to invest
more on its core business, expand its product range, productivity, marketing and promotion.
Hence, HR outsourcing is strategically aligned with the companys primary goals.
your decision?
Cooper: We mainly intended to outsource recruitment process including advertisement and

application screening, background check and appointment. The interview however, is
conducted by our company. The entire process was time consuming and we did not have the
appropriate IT facilities to hasten the process.
Cooper: Why not!! We have outsourced only recruitment function which has been
predominantly successful so far. We have been able to focus on training process which is
essential for employee performance and other appraisal processes. But there have also been
minor issues.
Cooper: Basically, selecting the appropriate vendor was the primary challenge that we faced
since it is important for a successful alliance that a mutual agreement exists.
Cooper: Some of my colleagues felt that the essential HR task being recruiting should not be
outsourced. Most of our HR activities now focus on payroll, employee motivation and
training.
the instances?
Cooper: Yes yes!!! There is insufficient knowledge about skill requirements for a non-IT
organization.
your organization?
Cooper: HR department in any organization deals with confidential information both of the
company and employees. Outsourcing this function involves risk. Hence, it involves
elaborate legal agreements before outsourcing HR functions.
Cooper: Well, people in India are highly professional and dedicated too. Besides, we can get
good quality of work at low cost and the place is very safe for an investment.
Respondent No: 4 Name: Kenneth Price
Designation: Associate HR Manager Age: 45 years
Type of Organization: Ricco Associated Ltd Sex: Male
Description:
Employee:
Mr. Kenneth price is the Associate HR Manager in Ricco Associated Ltd. Mr.
Kenneth joined in the company in 2004 as a HR executive and the he became the associate
HR manager in the year 2012. He has a significant experience in directing change
management initiatives through awareness creation, developing strategies to improve
employee engagement simultaneously assessing the employee capabilities.
Company Profile:
Ricco Associate is a multinational company having 20 years of experience in

electronic product development. It is a registered member of the Manufacturing Advisory
Services (MAS). Ricco Associates offer electronics and mechanical design prototypes and
manufacturing services to customers nationally.
Interview:
Mr. Kenneth Price is the Associate HR manager of an international company. In spite

of this busy schedule, when I requested him for an interview, he immediately agreed.
Me: Sir, shall we start the interview?
Kenneth: Ya ok.
organization?
Kenneth: The HR policies we practice are not different from the norms followed by most
organizations and we have made them employee centric while also maintaining a professional
work culture. We have recently introduced an online tool through which employees can post
their grievances since many of them are unsure of who to approach and how to deal with
work place problems.
Kenneth: The management started taking advantage of IT advances for several of its
functions. With regards to HR activities, we did not have the IT expertise and outsourcing
seemed to be more cost effective.
Kenneth: HR outsourcing has increased the efficiency in terms of recruitment which adds
value to the organizations primary goal of improving employee performance.
your decision?
Kenneth: The management regarded in-house HR management to be ideal but background

checks of employees became challenging while conducting mass recruitments. So, we
outsourced background check function and later even the Payroll.
Kenneth: Ya sure!! During the initial phase of outsourcing, the company faced problems
with respect to mutual agreements. However, it has eased in-house HR functions and we are
able to focus on core HR functions like talent acquisition.
Kenneth: See, companies making the strategic decision to outsource manufacturing or design
service confronts several challenges. In our company, it was challenging to establish the right
alliance to ensure that the companys mission, vision and goals are upheld.We had to
ensure that the type of knowledge required and the culture that exists is understood by the
vendor.
Kenneth: It requires for us to constantly interact with our HRO vendors and we feel this is an
additional task. Even though some functions are outsourced, we have to keep track for our
own record. We feel it has increased our work.
the instances?
Kenneth: Hmm well yes!!! The quality of service has been fluctuating and the process of
legal agreements to uphold the trust is complex.
your organization?
Kenneth: There is certainly the risk of loss of control over HR policies among employees.
For example, if there are issues with employees salary payment, they are unsure of who to
approach and how to resolve the problem.
Kenneth: In India, many professional people are available at lower cost. At the same time,
we can get quality work from them.
Respondent No: 5 Name: Clement Hubert
Designation:Senior HR Manager Age: 47 years

Type of Organization: Arvato
UK: The Portergate,Bertelsmann Ltd
Ecclesall Road, Sheffield, Sex: Male
S11 8NX I UK # +44-1143520021, Info@tutorsindia.com

Description:
Employee:
Mr. Clement Hubert is the Senior HR Manager in Arvato Bertelsmann Ltd. Mr.
Hubert has profound knowledge in Human resource consulting, recruiting, training and
development arena. Mr. Hubert joined in the company in 2004 as a HR executive and he
became the senior HR manager in the year 2012.
Company Profile:
Arvato Bertelsmann is a global company and has 50 years of experience in a

public sector organization. The company provides a variety of services such as financial
service, customer service, and supply chain solution and so on. The company operates in
various countries and generates annual revenue of over 16.1bn.
Interview:
Mr. Clement Hubert is the Senior HR manager of an international company. Despite

of his hectic schedule, when I requested him for an interview, he immediately agreed.
Me: Sir, are you ready for the interview?
Huber: Yes.
organization?
Huber: Execution of HR policies is not only good for employees but also for the
organization. Our company strictly follows well framed HR policies and ensure that we
address the grievances of our employees.
Huber: Well, companies generally view outsourcing for administrative purposes, like
pension, healthcare and employee welfare related aspects which are considered to be
cumbersome processes involved in preventing the conception and implementation of growth
related strategies.
Huber: My opinion is the outsourcing might be a possible approach to execute or restructure

internal processes and also might help in delivering strategic advantages to the organization.
your decision?
Huber: The benefits basket was entirely demanding to be outsourced as it involved health
insurance, medical claims, family health covering schemes, etc., which was too much to
handle and required financial and medical knowledge to process these functions.
Huber: Success and failure are common for any business. Well, yes, we have achieved
fruitful success in outsourcing business as the vendors are updated with the latest information
on regulations and schemes for benefits, it was considered to hire them to perform these
functions of the HR department.
Huber: Some vendors were hesitant in disclosing the companies who had availed their
services which the vendors claimed to be associated with and have provided appreciable
results. In such cases the claims of the vendors are skeptical.

Huber: The HR staff size decreased in organizations with HR outsourcing and the
recognition for HR professionals within the organization has comparatively decreased.
the instances?
Huber: Yes!! There is a gap in transferring the skill and knowledge which is specific for the
position which in turn affects the productivity of the organization.
your organization?
Huber: The management sometimes losses track of the functions that are executed if any
aspect of the HR functions are outsourced for which necessary procedures need to be
structured before outsourcing.
Huber: India has the largest pool of talented people and it is easy for companies to find out
employees at affordable rates.
Respondent No: 6 Name: Richard
Designation: HR Manager Age: 38 years
Type of Organization: Cygnet info tech Sex: Male
Description:
Employee:
Mr. Richard is the HR Manager at Software Company. He has good knowledge in the
management area specifically human resource consulting, recruiting, training and
development. Mr. Richard joined in the company in 2004 as a HR executive and he became
HR manager in the year 2012.
Company Profile:
Cygnet info tech is a multinational software consulting company and has 14 years
of experience in developing web and mobile software. The company provides a variety of
services such as customer software development, software testing, mobile app development
and software product maintenance.
Interview:
Mr. Richard is the HR manager of a well established and renowned company. I have
met him in his office and requested him for an interview. Without any hesitation, he
immediately agreed.
Me: Sir, shall we start our interview?
Richard: Yes
organization?
Richard: HR policies are very important for an organization and having realized this we
have excellent policies and procedures which will be updated periodically and intimated to
our employees.
Richard: Our parent organizations are concerned with the expenditure involved in executing
HR activities for newly founded organizations.
Richard: According to me, time consuming activities such as processing procedures and
verification processes can be executed by outsourcing thereby providing time and scope for
planning and implementation of strategic goals.
your decision?
Richard: The payroll process and fulfillment of government regulations in payment process
or conforming to labor laws, which might interfere with the crucial time of the organizations
growth. Therefore, such unavoidable procedures that have to be executed promptly are best
executed by the vendors who keep updated of the latest government rules and regulations and
are aware of its procedures.
Richard: Yes. Professional reporting on all the training, evaluation methods will enable to
assess the outcome of the strategies employed and associate with returns on investment.
Richard: Well, the resources or the expertise available, the software and hardware systems
involved and also the reliability of the firm on all these aspects against the claims of the
vendors is daunting to scrutinize the facts.
Richard: Sometimes employees with inappropriate skill set recruited were challenging to be
trained and attitude alignment with the vision and mission of the organization were
compromised resulting in low productivity.
the instances?
Richard: We mainly confront challenges in conveying information pertaining to the

requirements of the organizations to the vendors.
your organization?
Richard: There were possibilities of cross cultural differences between our organization and
the vendor and a clear understanding was lacking past these barriers
Richard: HR outsourcing is to integrate business and technology systems of the

organizations which are to be established in India.
Respondent No: 7 Name: Andrea
Designation: HR Regional Head Age: 47 years
Type of Organization: Aegis limited Sex: Female
Description:
Employee:
Ms. Andrea is the HR regional head of the Aegis global service company. He has in-
depth knowledge in good employee relations experience, along with strong project
management skills and he has the ability to manage multiple stakeholders across different
locations.
Company Profile:
Aegis Limited is a global outsourcing and technology company whos providing

this service for the past 30 years. At present, the company has operation in 56 locations
across 13 countries. The company provides a variety of services such as Banking and
Financial services, insurance, Technology, Telecom and so on.
Interview:
Ms. Andrea is the Regional HR manager of a prominent company. One fine morning I
have met him in his office and requested him for an interview. He accepted the request
without any aversion.
Me: Madam, shall we move on to the interview?
Andrea: Yes, please.
organization?
Andrea: We include a representative of the employees to obtain their viewpoint while

framing HR policies and for its optimal application and execution of the frame policies.
Andrea: Truly speaking, the reason is the low cost. The factors that seemingly drive
organizations for outsourcing can be a cost and man-hours involved in executing the norms,
legal processes and reducing business volatility.
Andrea: As per me, Volumes of data processing or insurance, healthcare procedures can be
facilitated by outsourcing agencies or vendors which renders the organization free from
involving in such elaborate processes.
your decision?
Andrea: In our organization, mostly temporary staffing is handed over to the vendors as they
are likely to be replaced frequently and their payroll and other associated procedures are not
to be interfered with the growth of the organization.
Andrea: From my perspective, sometimes best management practices and updated personnel
management techniques.
Andrea: See, without any challenges, there will not be any enthusiasm. Lets come to the
point, the customer service, including the response time, contact establishment and mode of
communication for clarifications are vital which are compromised with certain vendors.
Andrea: Employee rapport and record of grievances and feedback were overlooked as
employees resort to approach vendors reading the allocated functionalities.
the instances?
Andrea: Obviously!! We mainly face challenges to obtain a consolidated opinion on the

vendors with varied opinions and perspectives.
your organization?
Andrea: It is important to identify the vendor who could comprehend the requirements of the
organization and translate it to suit the requirements which at times can make the
organization quite dependent on them
Andrea: Hmm!!!!! Well, the primary motive is to reduce operational costs involved in
setting up an entire team of professionals and supportive infrastructure.
Respondent No: 8 Name: Adam
Designation: Senior HR Manager Age: 42 years
Type of Organization: Allied global solution Sex: Male
Description:
Employee:
Mr. Adam is a senior HR manager in the Allied global solution for last 3 years. He
joined in the company as an HR manager in 2006. He is very efficient in developing,
implementing and evolving HR policies to maintain a high business growth in areas such as
performance management, organizational design and career development.
Company Profile:
The Allied global solution is leading global managed IT Outsourcing company. The
company established in the UK in 1992. The company provides IT Outsourcing Services and
operates in EMEA, North and South America, Australia and Asia Pacific.
Interview:
Mr. Adam is a prominent HR manager in Allied global solution. He is always busy with
his managerial tasks. Despite of his hectic schedule, when I approached for an interview, he
gave me the permission without any hesitation.
Adam: Yes
organization?
Adam: HR policies are indispensable to any organization. By understanding its importance,

we are strictly adhering to the policies. The policies will be updated periodically and the same
will be intimated to our employees at a time.
Adam: Well, our company feels that outsourcing is the panacea for all problems. It is a kind
of shortcut procedure to obtain high competitive advantage in marketing niche.
Adam: In my opinion, Outsourcing has become a strategic imperative to our company and it
increases the organization flexibility, productivity and quality.
your decision?
Adam: We are outsourcing our administrative tasks. The reason behind this is if our
manpower is concentrating more on the administrative tasks, we will not be having enough
time to focus on our strategy planning.
Adam: Obviously, HR outsourcing helps us to minimize risk in terms of labor laws and
employment regulations which our employees may come across.
Adam: We are facing challenges in identifying the key metrics which are important to attain
the business goals and performance. Apart from that it is difficult to understand the factors
which will lead to user satisfaction.
Adam: Some of my subordinates feel that they should be comfortable in contacting an

outside party rather than the in-house team. This can be a complex change to accommodate.
the instances?
Adam: Not that extent, but still some vendors fails to provide the best practices which the
service provider learned from its other clients.
your organization?
Adam: Well, while outsourcing the HR functions, our company should give the employee
information to the vendor. It may create a security problem.
Adam: As per me, in the world, the people of India have a sound technical knowledge. This
is the reason we prefer India for HR outsourcing over other countries.
Respondent No: 9 Name: Zephan
Designation: HR Regional Head Age: 52 years
Type of Organization: Acora Solution Sex: Male
Description:
Employee:
Mr. Zephan is Regional HR head of Acora Solution who is joined in the company in
2004 as a HR manager. Then he got promoted to HR Regional Head in 2009. Mr. Zephan
possesses good employee relations experience, along with strong project management skills
and he has the ability to manage multiple stakeholders across different locations.
Company Profile:
Acora is an international organization which provides outsourcing solutions with
headquarters in the UK. The company provides consultancy services, cloud services, IT
security etc.
Interview:
I approached Mr. Zehan, who is the regional head of a famous company, despite of
his busy schedule, he immediately accepted my request.
Zephan: Yes, please.
organization?
Zephan: In our company, the HR policies are framed based on the suggestions which are
obtained from employees. Presently, our company established a new website where
employees can easily express their suggestions and feedbacks.
Zephan: One of the biggest factors which made our company take the outsourcing decisions
is cost reduction and brings more profit to the company.
Zephan: While considering outsourcing as an initiative, it offers soft-cost savings to the

organizations in a more efficient way.
your decision?
Zephan: We outsource finance related functions. It helps us to save money and we will get
more time to focus on the key part of our business.
Zephan: Why not? The most obvious benefit is in terms of cost savings. Also, it enables us
to deliver our services a faster rate.
Zephan: good question! The biggest challenge we are facing in identifying the risk factors
for the company and transferring them over to the outsourcing partner.
Zephan: As you rightly asked, it may bring a negative impact on our internal team and they
will lose their motivation, feeling that their significance as good performer became less.
the instances?
Zephan: As you know, nobody is perfect. Due to some mistakes made by the vendor, our in
house employees need to rework on the same task, which in turn affected our whole
productivity.
your organization?
Zephan: In my opinion, the main risk associated with our in house employee satisfaction. If
a third person handles the HR functions, employees may feel their issues aren't being handled
properly by the employer.
Zephan: Well, employees from India are very talented and they will assure fast turnaround
time.
Respondent No: 10 Name: Wilson
Designation: HR Manger Age: 32 years
Type of Organization: CAPITA Sex: Male
Description:
Employee:
Mr. Wilson is the HR manager in Capita, who joined in the company in 2006 as an
HR executive. He is well experienced in recruitment, career development, compensation and
benefits, employee relations, grievance issues, industrial relations, employment law,
compliance etc.
Company Profile:
Capita is an international business process outsourcing and professional

services company headquartered in London, United Kingdom. It has a overall market share of
27% in 2009, and the company supports clients in central government, local government and
the private sector.
Interview:
When I approached Mr Wilson for an interview, he happily accepted my request and

was very cooperative throughout the interview.
Wilson: Sure.
organization?
Wilson: Regarding the HR practices in our company, I can say that we have well-developed
HR policies which favors both company and staff members. Before implementing new
policies, we will conduct meeting with employees in order to get their suggestions.
Wilson: Fine, it is a boon to our company which yields more profit and strengthening the
bottom line.
Wilson: Well, in place of current management, if we are outsourcing administrative functions

relating to employment, it adds value to the company.
your decision?
Wilson: Well, we outsource some specific business functions, which can reduce the
operating cost of our business and thereby achieving superior customer service and
productivity.
Wilson: Yes of course, by outsourcing the functions, we no need to invest in the

infrastructure, since our outsourcing partner takes the responsibility of the business processes
and also develops the infrastructure for the same.
Wilson: Ok, the challenge we are facing related to the service costs. That means, we are
finding difficulty in understanding the process costs which is to be transferred to the vendor
and finding a mutually exclusive cost model for the same.
Wilson: Hmm... Some of my colleagues lost interest work, thinking that their job role is
being moved away. It affects their performance, hence reducing companys productivity.
the instances?
Wilson: Yap, recently we got a bad feedback from one of our client due to the mistake made
by the companys outsourcing vendor,
your organization?
Wilson: One of my important considerations is in the quality of service provided by the
vendor. If the quality is not up to the mark, ultimately, our company is responsible for that,
right?
Wilson: According to my perspective, in India, it is very easy for us to find the talented
employees at an affordable rate.
INTERVIEW QUESTIONNAIRE FOR OUTSOURCING VENDORS
Respondent No: 1 Name: Karan
Designation: Senior HR Age: 45 years

Type of Organization: WNS Global Service Sex: Male
Description:
Employee:
Karan is a Senior Manager in the business process management company based in

Mumbai. He started his career in the company during 2000 as a Team leader. Due to his
sincerity and hard work, he got promoted as a senior manager in the year 2012. He has
profound knowledge in the management field as well as good leadership skills and people
management capability.
Company Profile:
The company was commenced in the year 1996 as a captive / in-house unit of British
Airway and was known as a WNS World Network. It provides several services in the area of
risk management, healthcare, insurance, manufacturing, media and entertainment, retail and
consumer packaged goods, shipping and logistics, telecommunications and so on.
Interview:
Mr. Karan is a senior officer in a global company. I have met him in his office and
requested him for an interview. He immediately agreed to give me an interview.
Karan: Yes.
Me: Has your business of providing HR services to organizations been successful? Why
do companies prefer to outsource HR activities?
Karan: We have been in business for the past 15 years, which is evident of our success.
Various multinational companies outsource their HR activities so that they can expand their
business and invest more on their core activities.
Me: What kind of apprehensions do companies have in outsourcing their HR functions

and how do you deal with them?
Karan: Well, response time or miscommunications are the commonly occurring issues;
however, when the client is satisfied with the solutions these issues are rectified from
occurring further
Me: As HR specialist, what are the core functions of HR you think that influence
organizational strategies?
Karan: HR functions are critical to the everyday operations of the business and as the
organization develops, the functionalities associated are also significant. Important aspects
such as soft skills training, additional updated skill set for the employees are also important to
execute the strategic decisions taken by the organizations.
Me: Which HR functions in the industry are outsourced mostly?
Karan: For me, contractual agreements, coaching, relocation, compensation programs, fire
drill, orientation of laws against sexual harassment, food and transport contracts are some of
the most commonly outsourced HR functions.
Me: Have you faced any issues with organizations you provide HR services for? If yes,
what kind of issues have you faced?
Karan: There are certain payment issues that arise with the services provided which might
vary in perspective depending on the continuous change during the development of the
organization.
Me: What initiatives do you take to market your service and how do you build the trust
for your clients?
Karan: We have a record of all the testimonials and successful practices that has enhanced
our clients in meeting the goals, posted on our website. Our clients are also enlisted in our
website which can be viewed or verified.
Me: What challenges do you have to face when you provide HR services for developed
countries?
Karan: We found that training and interview patterns, information management pertaining to
the employees of the developed countries are much more stringent and necessitate the
employment of sophisticated evaluation and assessment procedures.
Me: What are risks in accepting HRO from developed countries?
Karan: To my knowledge there might not be any disadvantages in outsourcing the HR

functions once the process of the organization is explained and the requirement is well
outlined.
Respondent No: 2 Name: Rajesh
Designation: Assistant Manager Age: 45 years
Type of Organization: Reliance BPO services Sex: Male
Description:
Employee:
Mr. Rajesh is the Assistant manager well established BPO service firm. He started his
career in the company during 2000 as a Team leader and gradually he got promoted as
Assistant Manager.
Company Profile:
Reliance BPO services is one of the well-established company In India. India`s largest
private sector Information and communications company, a non banking financial services
company and India`s largest integrated private sector power utility company, among other
national & international businesses from telecom and banking verticals and generated the
total revenue of US $ 6 billion.
Interview:
Mr. Rajesh is the Assistant Manager in a renowned company. Being an assistance

manager, he was very down to earth. I have met him in his office and requested him for an
interview. He immediately agreed to give me an interview.
Rajesh: For the last 15 years, our company successfully run this business and we have
received a number of projects from various multinational organizations regarding HR
outsourcing activities.
Rajesh: Companies are concerned about confidentiality issues and quality of service. We
have framed precise policies and ensure that we clearly understand the requirements of our
clients.
Me: As HR specialist, what is the core functions of HR you think that influence
Rajesh: For me, recruitment and training play an important role in influencing the
organizational strategy.
Rajesh: It varies depending on the organization. Some organizations outsource entire HR

function, while others outsource only part of the function.
Rajesh: We have never faced any issues with our clients. We provide quality service and
regularly ask for feedbacks. Our clients are satisfied, engaging with us for their HR functions.
for your clients?
Rajesh: We request our top clients to write testimonials on our website.. We keep our
clients engaged on professional networking sites. We are flexible with our service and
provide customized service to our client which builds trust.
countries?
Rajesh: It is challenging to deal with organizations in developed countries since their

professional etiquettes are far different from India.
Rajesh: There are no risks per se.. But multinational companies based in the US and UK
tend to undermine the capabilities of Asian vendors
Respondent No: 3 Name: Samuel
Designation: Marketing Head Age: 35 years
Type of Organization: Zenith Consultant Sex: Male
Description:
Employee:
Mr. Samuel is the Marketing head of a consultancy. Initially, he started his career in
the company during 2000 as a Team leader and gradually he got promoted as marketing head.
Company Profile:
Zenith consultant is the famous consultant in North India. They placed first position in
providing consultant service for IT sector. Zenith Consultancy Services can help your
business to develop strategic marketing campaigns to ensure that all contacts generated are
target specific inbound leads with the prospective clients. Interview:
Mr. Samuel is the Marketing head in a well-established consultant. Despite of his busy
schedule, he agreed to give an interview.
Me: Shall, we start our interview?
Samuel: Ok.
Samuel: We are ranked one among the top ten Indian outsourcing vendors. Most
organizations that outsource intend to advance and speedup the recruitment process and
reduce the cost involved.

Samuel: Some of our clients are concerned with leakage on information. To avoid this, we
strictly maintain confidentiality of our clients.
Samuel: Human resource is the primary driving factor of any business. Hence, building a
strong human capital is the essential task of a HR team.
Samuel: Majority of organizations approach us to seek services for recruitment function,

payroll, training and background verification.
Samuel: Even though we employ sophisticated tools for HR functions, errors do happen. For
example, mistakes while entering candidate details, errors in salary crediting etc. But these
have been rare scenarios and every time we try to eliminate possibility of errors.
for your clients?
Samuel: We do not engage in much of promotional activities since we are already well
established. We present and follow stringent recruitment policies and maintain good
relationship with all our clients which build trust.
countries?
Samuel: Since we need to co-ordinate with our UK counterparts, we need to work on a shift
basis and in some cases where the candidate is located abroad; processing documents may be
time consuming.
Samuel: We have several clients from different parts of the world including US, Canada,
Australia and UK We have not faced any risk dealing with these companies.
Respondent No: 4 Name: ChandraPaul
Designation: Senior HR Age: 45 years
Type of Organization: Ace technology solution Sex: Male
Description:
Employee:
Mr. Chandrapaul is the senior head of a software company. During his initial period,
he struggles a lot and finally he reached his ultimate position as Senior HR.
Company Profile:
The Ace technology solution is an ISO 9001:2008 Certified company providing end
to end software solution. It provides a range of services such as Open Source Development,
Web Design & Development Services, Software Testing, Technical Maintenance and Support
services.
Interview:
Mr. Chandrapaul is a Senior HR who is very busy with his work schedule. I have an
opportunity to meet him in his office and I requested him for an interview. He agreed to give
me an interview.
Me: Shall, I start the interview sir?
Chandrapaul: Sure.
Chandrapaul: Yes of course!!!! We are able to control the staffing procedures and provide
continuous staff rotation and also negotiate with prospective employees on the CTC.

Chandrapaul: Usually we face problems regarding the leakage of information and

miscommunication. However, we rectified such kind of problems immediately to avoid re-
occurrence.
Chandrapaul: Traditional transactional functions such as leadership development and

management of manpower and skills which are outsourced now days were the core
functionalities of HR earlier.
Chandrapaul: Well, in our company, temporary staffing procedures are often outsourced
based on the requirement of client.
Chandrapaul: Sometimes payment issues have occurred with the services provided which
may differ in perspective relied on the changes occurs during the development of the
organization.
for your clients?
Chandrapaul: We maintain a record of all our success stories and practices that has
enhanced our clients in meeting the goals, posted on our website.
countries?
Chandrapaul: The cultural and legal differences are most stringent forms of challenges we
come across when dealing with HR outsourcing in developed countries.
Respondent No: 5 Name: Sami
Designation: HR Manager Age: 35 years
Type of Organization: Genpact Limited Sex: Male
Description:
Employee:
Mr. Sami is the HR manager of Genpact who joined in the company in 2008 as HR
executive. He is well versed in recruiting employees, career development and employment
law, etc.
Company Profile:
Genpact is the largest BPO Company in India with a population of 65000

employees working, and a turnover of about $1.5 billion, which is highest by any Indian
company. It is a business processing and technology management company which mainly
deals with outsourcing and technology services
Interview:
Mr. Sami is a dedicated, efficient, and prominent HR manager of Genpact an
international BPO company. He always seems to be more active, busy and friendly person.
Though he was too busy, he allocated some time when I approached him for an interview.
Sami: Ya sure.
Sami: The methodology for process improvement is challenging for us as it is for the
organization when implementing it, nevertheless we learn and improve each time with the
requirements to match their expectations

Sami: Companies are concerned about whether their requirements are clearly understood by
us. We meet them with concerned professionals who have the knowledge to comprehend
their requirements from where start off.
Sami: HR function is imperative for day to day operations in the business. The talent and
skill management are primary factors that influence the organizational strategies of an
organization.
Sami: Additional facilities such as transport, medical insurance, health benefits or schemes
are highly preferred to be outsourced.
Sami: The performance measurement parameters set by the organization may vary from that
of the performance set by us which in turn needs to be reassessed.
for your clients?
Sami: We explain the methodologies and the suggested alternatives which are convincing for
the clients to relate that their requirement will also be fulfilled as previous cases handled.
countries?
Sami: The work policies and ethics are different and solutions have to be modified according
to such policies and practices of the organization while the HR functions are outsourced to us.
Sami: It is important for us to convince the multinational companies that we are aware and
are knowledgeable of the organizations legal and governmental policies so that they can
entrust us with their requirements to offer our services otherwise which the contract can be
terminated.
Respondent No: 6 Name: Kishore
Designation: Branch Head Age: 35 years
Type of Organization: Tata consultancy services Sex: Male
Description:
Employee:
Mr. Kishore is the Branch head in one of the famous company TCS. He is too sincere
and dedicated person. Because of these qualities, he got promoted as branch head during
2012.
Company Profile:
TCS BPO is the second after Genpact to cross this mark. TCS BPO has 34000
working professionals. It experienced a growth of 14% last year and contributed to 11% of
the total revenues of TCS.
Interview:
Mr. Kishore is a prominent branch head in TCS group. He is too active and busy with
his work always. Despite of his hectic schedule, when I approached for an interview, he gave
me the permission without any hesitation.
Me: Sir, Shall we proceed?
Kishore: Definitely.
Kishore: It is difficult to perform the redundant process of calculating and processing health
care facilities which involves the collection and submission of supportive documents which
the organizations prefer to rather outsource than get involved with.

Kishore: The iteration rate is another challenge which we come across while recruiting for
organizations, but pinning down a person into a position which is not fulfilling will result in
such issues. However, we have constant discussions about it with organizations and try to
prevent staff turnover.
Me: As HR specialist, what are the core functions of HR you think that influence
Kishore: Leadership development programs are critical to the implementation of

organizational strategies and are also one of the core functions of HR.
Kishore: Government, labor policies, or regulations and filing of tax returns are also
outsourced to be completed by the vendors as it involves immense paperwork.
Kishore: Translating the organizations objectives and mission into the prospective employee
while recruitment is important and the reception of information varies from employees.
for your clients?
Kishore: Our subject analysis experts are the first point of contact that are well versed with
the problem scenario and assess the requirement of the clients.
countries?
Kishore: Language in some countries can be a barrier and often may lead to
miscommunication as the terminologies or technical terms can often be misunderstood across
countries.
Kishore: Any change in authority or in the case of acquisitions or mergers, the contract has
to be redrawn and at times there are high chances of losing the contract.
Respondent No: 7 Name: Luke
Designation: Regional level Manager Age: 35 years
Type of Organization: Aditya Birla Minacs Sex: Male
Description:
Employee:
Mr. Luke is the regional level manager of Birla group. He is very brilliant in handling
employees and excellent in his work. He joined in this company as junior level manager
during 2004 and he got promoted as regional level manager.
Company Profile:
Aditya Birla Minacs is a business processing service provider and a subsidiary of Aditya
Birla Corp. The company started its operations in 2007 and in six years the company has put
up a turnover of $438 million while adding 21000 employees.
Interview:
Mr. Luke is a regional level manager of well established firm. One day, all of sudden I
got an opportunity to meet him in his office and I requested him for an interview. He
immediately says yes without any hesitation.
Luke: Yes, proceed.
Luke: We collect information on the regulations issued by the government and while it is
about to be implemented, we are prepared with the essentials to complete the process for the
employees of the organization.

Luke: Companies do have apprehension specifically on the legal aspects, governmental

regulations and whether they will be any implications if any norms are not followed. We
provide assurance on the procedures and legal advisors are part of the team.
Luke: Being a HR specialist, I consider certain factors such as soft skills training, knowledge
updated skills, etc are the influential factors of organizational strategies.
Luke: Mostly, the functions like coaching, compensation programs, food transport contracts,
medical insurance, health benefits are highly preferred for outsourcing.
Luke: Data protection and privacy laws need to be conformed for which experienced and
skilled workforce is required for our team without which such policies can be compromised.
for your clients?
Luke: Client sometimes comes up with the solutions which are required to be followed on
periodic basis and we assure them that we possess the appropriate software and facilities
required to periodically process the functions specified.
countries?
Luke: The executions of new methodologies, training, interview pattern, languages, work
policies, ethics are the areas where we can face major challenges.
Luke: The multinational organizations sometimes provide less freedom to execute

procedures and undermine the services rendered which will lead to distrust and may reflect in
delay of payment date.
Respondent No: 8 Name: Shiva
Designation: Customer service quality head Age: 38 years
Type of Organization: First source solution Ltd Sex: Male
Total no of employees:
26000
Description:
Employee:
Mr. Shiva is the Head of customer service quality in a well renowned business
outsourcing company. During his initial period, he struggles a lot and finally he reached his
ultimate position as Senior HR.
Company Profile:
Firstsource is a specialised company in global business outsourcing . The company

operates in India, UK, Ireland, and the Philippines and generated the total revenue of $138
million.
Interview:
Mr. Shiva is the head of customer service quality and always busy with his work. I
have an opportunity to meet him in his office and I requested him for an interview. He
immediately says yes without any hesitation.
Shiva: Yes.
Shiva: We are providing assistance to the organization right from the initial stage by
understanding their requirements and minimizing on the time taken to comprehend those
requirements employing skilled professionals who can immediately understand the
requirements and associate with updated solutions.

Shiva: There are at times uncertainty in the functions of internal HR and those that have been
assigned to us. The clear demarcation of the roles and functionalities can be used in resolving
such discrepancies.
Shiva: Innovative workforce management skills and motivation for the employees towards
achieving strategic goals are important core functions of the HR department.
Shiva: High-volume recruitment and payroll generation and human resources maintenance
are the outsourced HR functions.
Shiva: Yes of course!!! Clear communications of the goals, timeline are not provided which
leads to a lot of misunderstandings.
for your clients?
Shiva: Out team expertise and the previous accomplishments are satisfactory for the clients
to entrust in our services.
countries?
Shiva: There is a high possibility of resistance to change while implementing new

methodologies, policies or procedures as the employees have to be convinced of the reason
for which it has to be carried out or explain its outcome to get their cooperation

Shiva: Customer service quality has to be constantly maintained at high standards to ensure
smooth transactions and execution of the functions outsourced which can otherwise become a
threat to the agreement.
Respondent No: 9 Name: Arjun
Designation: Assistant Manager Age: 32 years
Type of Organization: Datamatics Sex: Male
Description:
Employee:
Mr Arjun is an assistant manager in Datamatics for last 4 years. He joined in the

company as HR executive in 2005.
Company Profile:
Datamatics is a CMM level 5, with registered office in Mumbai, India. It is an IT

Services company providing services, solutions, consulting such as enterprise business
solutions, application development etc.
Interview:
I met Mr. Arjun in his office for the interview, despite of his busy schedule he agreed
for it immediately.
Arjun: Yes, of course.
Arjun: Definitely, our existence in the industry for these many years is a proof for that. By
outsourcing the HR functions, client companies can focus on their core business activities.
Me: What kind of apprehension do companies have in outsourcing their HR functions
Arjun: Ok, outsourcing causes the company to lose control over whos doing what and the
details, which is an important consideration.
Arjun: According to me, HR functions are very significant to every organization. The core
functions which affect organizational strategy are staffing, training and development,
employee engagement.
Arjun: From my experience, I understood that the most common HR functions which
companies outsourced are payroll, background checks, temporary staffing, employee
relocation etc.
Arjun: In my opinion, the most common issue which every outsourcing partners face is
making a mutually agreeing cost model for the processes which is outsourcing.
for your clients?
Arjun: By ensuring 100% customer satisfaction and providing low turnaround time, we are
maintaining a good relationship with our clients.
countries?
Arjun: In my perspective, the communication pattern and language is the main barrier. We
are now providing adequate training to overcome; still it persists as an issue
Arjun: In my perspective, once we made a good relationship with the client in terms of trust
and their customer satisfaction, there will not be much risk.
Respondent No: 10 Name: Joshua
Designation: Marketing Head Age: 38 years
Type of Organization: ITC infotech Sex: Male
Description:
Employee:
Mr. Jousha is a marketing head of global IT Service Company. He has good potential in
managing marketing and sales teams and capable of identifying markets for the companys
products and service. He joined in the company as a sales representative and he got promoted
as marketing manager in 2010.
Company Profile:
ITC Infotech, a global IT services company, is a fully-owned subsidiary of ITC Limited.

ITC Limited is rated among the World's Most Reputable Companies by Forbes magazine
and among India's Most Valuable Companies by Business Today.
Interview:
Mr. Jousha is the most sincere and fun-loving person. When I approached for an
interview, he gave me the permission without any hesitation.
Joshua: Sure.
Joshua: Yes, of course. HR outsourcing enabled our company to attain competitive edge
over competitors by delivering products promptly as well as with high quality. In my
experience the main reason for companies to outsource is to save cost and eliminate risks.

Joshua: Yes, outsourcing comes up not only with advantages but also with certain
disadvantages. Outsourcing limits our flexibility in few ways. However, its benefits
overcome its disadvantages.
Joshua: It affects our organization strategy in terms of training and development,

recruitment, and customer service.
Joshua: Generally, bulk recruiting, temporary staffing, payroll, updating staffs handbooks
and policy manuals.
Joshua: No, I have not faced any such issues till now. Well-documented legal agreements
helped us to avoid these kinds of issues.
for your clients?
Joshua: We mainly focus on excellent customer service and effective marketing strategy to
attract customers.
countries?
Joshua: Huge pay and inconsistent performance are the two major issues we faced while HR
outsourcing in developed countries.
Joshua: As I mentioned above, both these factors are the main challenges we faced with the
developing countries.
Appendix : 2
Table 4.1: Table below presents main themes emerged under HR policies and
procedures, description and relevant interview codes.
Main Themes emerged: Description of themes Interview codes
HR Policies and
Procedures
Online tool and INT_3_OUT ;
Handbook, Suggestions INT_4_OUT;
Effective HR practices from employees, conduct INT_5_OUT;
meetings to post INT_7_OUT;
grievances and read INT_9_OUT;
policies and made INT_10_OUT
employee centric to
mitigate the problems
faced by the employees
Table 4.2: Table below presents main themes emerged under Motives that
influenced Outsourcing Decisions, description and relevant interview codes.
Motives that influenced Description of themes Interview codes
Outsourcing Decisions
Globalization and restructuring, INT_1_OUT;
Phenomenal Motives Multiple Operative Offices, INT_2_OUT;
and Complexities that Legal regulations, companies are INT_6_OUT
have led to outsourcing concerned with the expenditures
Decisions involved in executing HR
activities,
Major Driving Factors Cost-effective and could focus INT_3_OUT;
more on business, Can avail INT_4_OUT;
better advantage of IT advances, INT_5_OUT
outsourcing is panacea for all INT_7_OUT;
problems, a shortcut procedure INT_8_OUT;
to obtain high competitive INT_9_OUT;
advantage, view outsourcing for INT_10_OUT
administrative purposes, like
pension, healthcare and
employee welfare related
aspects
Table 4.3: Table below presents main themes emerg ed under Strategic
viewpoint Of Outsourcing Decisions, description and relevant interview codes.
Strategic viewpoint Of Description of themes Interview codes
Outsourcing
On the business Enables to focus on core (INT_1_OUT);(INT

perspective activities, increases the _2_OUT);
organization flexibility, (INT_3_OUT);(INT
productivity and quality, invest _4_OUT);
more on marketing, offers soft (INT_8_OUT);
cost savings, data exposure can (INT_9_OUT);
be minimized and greater (INT_10_OUT);
protection exercised by the
vendor. efficiency in
recruitment,
Other beneficial factors Possible approach to execute or (INT_5_OUT);
restructure internal processes (INT_6_OUT);
delivering strategic advantages, (INT_7_OUT);
time consuming activities such
as dats processing procedures
and verification processes, or
insurance, healthcare
procedures can be done by
outsourcing,
Table 4.4: Table below presents main themes emerged under driving factors of
HR outsourcing description and relevant interview codes.
Driving factors of HR Description of themes Interview
outsourcing codes
Major driving factors Superior customer service and (INT_1_OUT);

productivity, to focus on core (INT_2_OUT);
activities, data protection, increased (INT_3_OUT);
efficiency, adds value to company, (INT_5_OUT);
restructure internal process, reduce (INT_7_OUT);
work redundancy, offers soft-cost savings. (INT_9_OUT)
Functionalities that Booking procedures, currency (INT_1_OUT);

require outsourcing conversions and fare comparisons of (INT_2_OUT);
transportation are well executed, (INT_3_OUT);
employees periodic feedback are well- (INT_5_OUT);
drafted, processed and secured, (INT_7_OUT);
recruitment process and health (INT_9_OUT)
covering schemes handled by
outsourcing, handle payroll procedures
of temporary staffing, updated with
governmental norms, finance related
functions, specific business functions
Major Drawbacks of in- Background checks of employees (INT_4_OUT);
house HR management became challenging while conducting (INT_6_OUT);
mass recruitments, payroll process (INT_8_OUT);
affect crucial time of the organizations
growth. Handling administrative tasks
are time-consuming
Table 4.5: Table below presents main themes emerged under Benefits of HR
outsourcing functions description and relevant interview codes.
Benefits of HR Description of themes Interview Codes
outsourcing functions
Ways which HRO has Decreasing redundancy of INT_(1)_OUT;

benefitted the work, provides professional INT_(2)_OUT;
organization documentation, cuts down INT_(3)_OUT;
high cost basis, efficient INT_(4)_OUT;
recruitment functioning, INT_(5)_OUT;
eased in-house HR functions, INT_(7)_OUT;
Updated with all regulations INT_(6)_OUT;
and beneficial schemes, best INT_(8)_OUT;
management practices, to INT_(9)_OUT;
minimize risk in employment INT_(10)_OUT;
regulations, no need to invest
in the infrastructure,
Table 4.6: Table below presents main themes emerged under challenges and
issues of outsourcing functions description and relevant interview codes.
Challenges and Description of themes Interview codes
issues in outsourcing
Major Challenges Selection of appropriate INT_(1)_OUT;

vendor, identifying the INT_(2)_OUT;
keymetrics vital for attaining INT_(3)_OUT;
business goals, poor mode of INT_(4)_OUT;
communication for INT_(6)_OUT;
clarifications, delayed INT_(8)_OUT;
response time, Difficult to INT_(9)_OUT;INT_(10)
understand factors leading to _OUT; INT_(4)_OUT
user satisfaction, Identifying
the risk factors and assigning
to the outsourcing partners,
Challenges related to service
costs, mutual agreements.
Table 4.7: Outsourcing and its impact on HR team
Outsourcing and its Description of Interview codes
impact on HR team themes
Effective Enabled to focus more INT_(1)_OUT; INT_(8)_OUT;

on strategic planning
and core
functionalities, more
comfortable to contact
an outsourcing partner
rather than the in-
house team
Not effective Recruitment task INT_(2)_OUT; INT_(3)_OUT;
should not be INT_(4)_OUT; INT_(5)_OUT
outsourced, constantly INT_(6)_OUT; INT_(7)_OUT;
interacting with HRO INT_(9)_OUT;INT_(10)_OUT;
vendors, Decrease in
the HR staff size in
organizations, often
employees are
recruited with
inappropriate skill and
are difficult to get
them trained, record
of grievances and
feedback were
overlooked, can create
a negative impact on
in-house team,
Table 4.8: Table below presents main themes emerged under issues related to
HR outsourcing functions description and relevant interview codes.
Issues related to HR Description of Interview codes
outsourcing themes
Definitely yes! Services quality not INT_(1)_OUT;

satisfactory, INT_(3)_OUT;INT_(4)_OUT;
Insufficient INT(5)OUT; INT(6)OUT;
knowledge about skill INT(7)OUT INT(9)OUT:
requirements,
challenges in
conveying
information,
Challenges in
obtaining consolidated
opinion, Frequent
rework done by the in-
house employees
To some extent At times, vendors INT_(2)_OUT; INT_(8)_OUT
credibility is
questioned-double
checking the
information provided,
some vendors fail to
offer best practices.
Table 4.9: Table below presents main themes emerged under Risks in HR
outsourcing functions description and relevant interview codes.
Risks in Description of themes Interview codes
HR Outsourcing
Major Risk Factors Employees and organization INT_(1)_OUT;

rapport is affected, INT_(3)_OUT;
organizations confidentiality is INT_(4)_OUT;
affected, loss of control over INT_(5)_OUT;
HR policies among employees, INT_(6)_OUT;
looses track of functionalities, INT_(8)_OUT;
lack of clear understanding INT_(9)_OUT;INT_(
between the management and 10)_OUT;
the vendors, Affects in-house
employees satisfaction,
Service quality might get
affected.
Table 4.10: Table below presents main themes emerged under outsourcing
destination, description and relevant interview codes.
Outsourcing Description of themes Interview codes
Destination:
India
low cost and availability of skilled INT_(1)_OUT;

professionals, increased establishment of INT_(2)_OUT;
manufacturing units, customer support INT_(3)_OUT;
Choosing India centers for MNC firms, Indian people are INT_(4)_OUT;
as a major highly professional, safe to make INT_(5)_OUT;
outsourcing investments, avail quality work, fast INT_(7)_OUT;
destination turnaround time, INT_(8)_OUT;I
NT_(9)_OUT;
INT_(10)_OUT;
Table 4.11: Table below presents main themes emerged under motives and
effective HR outsourcing and practices, descript ion and relevant interview
codes.
Motives of HR To expand their business, (INT_OV_01;
outsourcing to focus on core INT_OV_03;
activities, to reduce cost INT_OV_06;
and time, to update the INT_OV_07;
process, to follow rules INT_OV_08;
and regulations of INT_OV_09;
Government, to reduce INT_OV_10)
work load, to attain
competitive edge
Effective HR practices Having a clear INT_OV_05,

understanding of their INT_OV_07,
requirement, having INT_OV_02,
updated knowledge on INT_OV_04
government rules and
regulations, by framing
precise policies,
Table 4.12: Table below presents main themes emerged under role of HR in
influencing organizational strategies, description and relevant interview codes.
Role of HR in Description of Interview codes
influencing themes
organizational
strategies
Soft skills training, INT_(1)_OV;
INT_(2)_OV;
knowledge updated
skill set, building a INT_(3)_OV;
strong INT_(4)_OV;
human capital,
leadership INT_(5)_OV;
development and
management of INT_(6)_OV;
manpower,
training and INT_(7)_OV;
recruitment, INT_(8)_OV;
innovative workforce
management INT_(9)_OV;
INT_(10)_OV
Table 4.13: Table below presents main themes emerged under commonly
outsourced HR functions, relevant interview codes.
Commonly outsourced Description of themes Interview codes
HR functions
contractual agreements, INT_(1)_OV;

compensation programs INT_(3)_OV;
food and transport contracts, INT_(4)_OV;
bulk recruitment function, INT_(5)_OV;
payroll, training and background INT_(6)_OV;
verification, temporary staffing, INT_(7)_OV;
outsourcing health benefit INT_(8)_OV;
schemes, outsourcing INT_(9)_OV;
government policies and INT_(10)_OV;
regulations, payroll procedures,
legal regulations etc
Table 4.14: Table below presents main themes emerged under issues faced by
outsourcing vendors description and relevant interview codes.
Issues faced Description of themes Interview codes
by outsourcing
vendors
Yes! Payment issues, errors in candidate details INT_(1)_OV;

and in salary crediting, performance INT_(3)_OV;
measurement parameters may vary, Issues INT_(4)_OV;
in Data protection and privacy laws, INT_(7)_OV;
timeline not provided, no clear INT_(6)_OV;
understanding on companys goals, INT_(8)_OV;
mutually agreement cost model INT_(9)_OV;
No! Provide quality services- our clients are INT_(2)_OV;
pleased and satisfied with us for their HR INT_(10)_OV;
functions, Well-documented legal
agreements, provide solutions to all kinds
of issues
Table 4.15: Table below presents main themes emerged under marketing
strategy, description and relevant interview codes.
Marketing Description of themes Interview
strategy adopted codes
by outsourcing
vendors
A track record of all testimonials INT_(1)_OV;

and successful practices of INT_(2)_OV;
prospective clients, providing INT_(3)_OV;
customized services, follow INT_(4)_OV;
Chief Marketing stringent recruitment policies, INT_(5)_OV;
Initiatives maintain holistic relationship with INT_(7)_OV;
clients, bring in suggested INT_(8)_OV;
alternatives and methodologies that INT_(9)_OV;
meets the clients requirements, INT_(10)_OV;
ensuring customer satisfaction, low
turnaround time
Table 4.16: Table below presents main themes emerged under challenges of
outsourcing functions
Challenges faced by Description of themes Interview codes
HR outsourcing
vendors from
developed countries
More stringent training, INT_(1)_OV;

interview patterns, INT_(2)_OV;
Major Challenges assessment procedures, INT_(4)_OV;
sophisticated INT_(3)_OV;
professional etiquettes, INT_(5)_OV;
rigid cultural and legal INT_(6)_OV;
differences, work on a INT_(8)_OV;
shift basis, document INT_(9)_OV;
processing is time INT_(10)_OV;
consuming, Difference in
work ethics and policies,
language barrier,
miscommunication, High
cost range,
Table 4.17: Table below presents main themes emerged under risks of HR
outsourcing functions description and relevant int erview codes.
Description of themes Interview codes
Risks faced by HR
outsourcing vendors
from developed
countries
Major risk factors Challenges in convincing the INT_(2)_OV;INT_(

multinational companies and 5)_OV;
make them to entrust us with INT_(6)_OV;
their requirements, change in INT_(7)_OV;
authority or in case of INT_(8)_OV;
acquisitions, provide less
freedom to execute procedures,
Customer service quality to be
maintained at all times,
undermine the capabilities
Havent faced any Process and requirement is well INT_(1)_OV;
risks outlined, maintain good INT_(9)_OV;
relationship with our clientele

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Advantages and Risks associated with outsourcing HR

functions in organizations and managing them.

The effect of globalization brought drastic changes in the business sector in

With changing business strategies, human resources in leading organizations

The current business world is promoting HR outsourcing as one of the most

HRO (human resource outsourcing) can be described as acquiring of in-progress

On the contrary, outsourcing of human resource functions without proper

In addition, in spite of effective outsourcing, external factors such as political,

1.1 Aims and Objectives

1. To identify the advantages associated with human resource outsourcing

2. To identify the risks associated with human resource outsourcing(HRO).

3. To identify human resource functions that can be outsourced and that

4. To understand how risk management practices will help in avoiding and

Organizations usually face many kinds of challenges in terms of finance,

According to the CIPD (The Chartered Institute of Personnel and Development)

2.2 Rational for Outsourcing Human Resources

Human resource outsourcing is highly dependent on organizational

Sally (2001) suggests that outsourcing helps organizations to focus their

Accessed new technology 12 51 32

Relived internal HR team pressure 15 39 43

2.3 Effect of Organizational Characteristics and Environment

Human resource outsourcing has become a recent widespread phenomenon

2.4 Elements of human resource Outsourcing

While making outsourcing decisions, organizations need to weigh what can be

The human resource functions may be either partially outsourced or

(Evren, 2004, p-14)

According to Thompkins (2005), the most important step organizations have to

The DTI project identified and produced a balanced environment in which

Shared culture agreed values which bind us together.

Shared learning - continuously improving ourselves.

Shared effort one business driven by flexible teams.

Shared information effective communication throughout the company.

In order to assist organizations to identify their core processes, the core

Table 2.2: Core competency matrix (Source: Tomkins, 2005)

2.4 Benefits Derived from HR Outsourcing

Another benefit of outsourcing is quality improvement (Belcourt, 2006). Laura

While some studies proved HR outsourcing as a positive element, there are

Effect on employee morale is another serious risk that organizations face by

2.6 Perspectives for HR Outsourcing

AUTHOR/ METHODS FINDINGS LIMITATIONS

Based on the above comparative analysis, it is observable that literature is

Developed countries and from the perspective of organizations outsourcing

The research methodology is the process or procedure used to collect

Figure 3.1: Onion Model of this dissertation

Research Approach Inductive approach

Time Horizon Cross Section

Data Collection Primary and secondary data

InstrumentSemi-structured interview guide

Source: Adopted from Saunders et al. (2009)

3.3. Research Philosophy

Positivism: Positivists believe that the reality is stable to be able to understand

Interpretivism: An opposition of positivism is intepretivism and depend on

Realism: The term realism can also be known as Neopost-positivism, post-

3.4. Research Approach

3.4.1. Deductive approach

In this approach, various theories have been tested to determine the

3.4.2. Inductive research approach

This approach is in contrast with previous approach. Normally, this will

3.5. Research strategy

Selecting an appropriate research tactic from the study objectives assume

Qualitative approach: This approach is used to cull non-numerical data from

Quantitative Approach: Numerical data are collected using this approach

The qualitative approach, an empirical inquiry was chosen to identify

3.6. Time Horizon