Why Firms Outsource HR Activities and What Are the Potential Problems and Benefits of Outsourcing HR Activities - Term Paper Example

Superficially, outsourcing seems to provide cheap labour supply, external expertise, synergies in competencies and perfection of all activities but in-depth analysis of outsourcing decision and related factors reveal serious consequences.... Commencing from an introduction and historical overview of outsourcing and reasons why managers outsource, the main body of the paper comprises major risks and potential hazards encountered in effective management of outsourcing decisions....

Further on, it provides discussion as well as description related to the pros and cons of outsourcing, Keywords: Outsourcing, pros & cons Outsourcing Introduction It seems to be the trend for small and medium sized companies or business that they outsource that they outsource specific niche activities of their business like tax planning, legal assistance and financial portfolio.... In the present business or corporate world competition has increased thus the managements are more inclined in utilizing their time for the business and competitive strategies thus they find outsourcing a feasible option however before making any such decision both the pros and cons of outsourcing core business activities like accounting/finance must be analyzed and then it should be decided whether to keep them in-house or outsource....

In the first place, they give us a solid understanding of the advantages of outsourcing specified HR functions.... Instead of rural areas embarking on activities which were not supported by heir environment, such as manufacturing, they focus on the agricultural activities supported by their environ; urban areas, instead of seeking to grow the raw material required for the manufacture of finished products, purchased the aforementioned from the rural areas....

The main aim of outsourcing is to gain competitive advantage. ... Traditional outsourcing has been restricted to non-core activities mainly Information Technology (IT) related. ... Certain core activities can be outsourced if there is considerable fluctuation in demand that does not justify full time increase in head count.... Odindo et al (2004) define outsourcing as “a situation in which an organisation allows all or part of its business processes to be undertaken by third party providers....

It will review how companies manage HR outsourcing and how beneficial it is for organizations to outsource hr activities in general.... For that reason, the goal of this paper is to research and analyse the concept of outsourcing an HR function and its benefits and barriers.... In order to fulfil all these tasks, it is important too, first of all, determine the concept of outsourcing itself.... A very clear and precise definition of outsourcing is provided by Brown and Wilson (2005), who states that outsourcing is obtaining services from outside of the company....

The number of organizations outsourcing HR roles are continuously growing, and the scope of outsourced hr activities continues to inflate (Allen, et al.... The dissertation has not been submitted in whole or part for assessment in another module at this or any… I have read the Academic Regulations and I am fully aware of the potential consequences of any breach of them. ... his inquiry is directed at analyzing the current state of the hr outsourcing market in Borouge and the trends that are dominant in the same....

With the devolvement of line managers in HR functions, this research would try to assess to what extent outsourcing hr functions is deemed necessary.... Various firms outsource the HR functions on the grounds of concentrating on core and strategic issues.... In the paper “Line Managers in hr Function,” the author analyzes the management of human resources, which is considered an activity that is carried out by all managers.... Recently line managers have been involved in the hr functions as they are supposed to have close interactions with the employees....

Commencing from the historical overview of outsourcing and reasons why managers outsource, the main body of the paper comprises major risks and potential hazards encountered in the management of outsourcing decisions.... outsourcing provides the benefit of 'asset specificity' (Zika 2004) in terms of customized, fully available and monitored resources to the outsourced activity or function.... This has been termed as 'outsourcing' in the business jargon and lately assumed much of significance in business scenario (Winkler 2009:22)....