Friday, March 17, 2006

HRO:Looking Ahead

The year 2005 has seen a major shift in the HRO market. Some analyst estimate that the total contract value of the deals are at nearly $4 billion.2005 also saw one of the major HRO deals of $1.1 billion, 13-year mega-deal signed by DuPont.

But will this year hold the same promise? One analyst who spoke with HRO Today off the record said 2006 is expected to draw some very large buyers into the market, but don’t expect the 25 to 30 percent growth it has witnessed in recent years. To read the list of Top HRO deals of last year click here.

THE HR Benchmark report comments that” more companies routinely look to outsourcing all types of business requirements, and increasingly review whether any expense can be managed more expeditiously outside the company’s four walls.

However, 2006 is not likely to be the year when companies in general decide to disband their existing HR departments and contract with third parties. Today, outsourcing some or all HR activities has a market penetration as follows:

*9% in companies under $50M in annual revenue
*40% in mid-size companies ranging from $50M to $999M
*66% in companies over $1B in annual revenue

1 comment:

Anonymous said...

Keep up the good work
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