Open AccessHuman Resource Outsourcing in Times of Economic Turbulence – a Contemporary Review of Practice
Author(s) -
Judit Beregszaszi,
Dieu HackPolay
Publication year - 2012
Publication title -
international journal of human resource studies
Language(s) - English
Resource type - Journals
ISSN - 2162-3058
DOI - 10.5296/ijhrs.v2i1.1250
Subject(s) - outsourcing , recession , transaction cost , business , human resources , globalization , key (lock) , term (time) , resource (disambiguation) , industrial organization , economics , marketing , finance , market economy , management , computer science , macroeconomics , computer network , physics , computer security , quantum mechanics
This article reviews developments in human resource outsourcing (HRO) in recent years, particularly in light of the severe economic recession prevailing since 2007. It establishes that companies are increasingly outsourcing routine HR processes, and in some cases, critical HR processes in view to cut costs. The article takes the view that while such a strategy could be viable in the short term, its long-term strategic effectiveness is questionable. This view is founded on widely accepted assumptions that people are critical assets in organizations, thus, commanding that companies maintain a strong hold on vital employee commitment processes. Outsourcing may not be the only valid framework for the future; companies must consider alternatives. Key words: Outsourcing; HRO; economic recession; cost saving; globalization; transaction cost.