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| GartnerGroup's Dataquest Says U.S. Human Resources Outsourcing Market to Exceed $37 Billion in 2003 | |||
| San Jose, California, November 22, 1999 - Human resources (HR) department staffs have been reduced within many companies despite the increased strategic importance of HR functions, resulting in many companies outsourcing some of their HR duties. The U.S. HR outsourcing industry is experiencing strong growth because of this issue, as HR outsourcing in the United States is forecast to grow from $13.9 billion in 1999 to $37.7 billion in 2003, according to Dataquest Inc., a unit of Gartner Group, Inc. (NYSE: IT). | |||
| A recent survey by Dataquest found that approximately 70 percent of the companies interviewed currently use or plan to use HR outsourcing services, making HR outsourcing one of the most widely accepted business process outsourcing (BPO) solutions. | |||
| "Currently, HR outsourcing penetration is highest by far in benefits administration and payroll processes, while penetration is most limited in hiring administration, recruiting and staffing, and records management," said Rebecca Scholl, industry analyst for Dataquest's Business Process Outsourcing North America program. "As the HR process becomes increasingly IT-dependent, the benefits of integrated process outsourcing are becoming more apparent." | |||
| Dataquest also asked companies that are not currently using or not planning to adopt HR outsourcing strategies why they have made this decision. Company culture was the No. 1 reason for not adopting HR outsourcing strategies, followed by the perceived high cost of external services. The third concern was the perceived loss of control. | |||
| "To compete and succeed in the market for integrated, multiprocess HR solutions, vendors must not only develop best-of-breed delivery capabilities across multiple HR subprocesses, but also commit resources to educate the market regarding the availability and benefits of a robust end-to-end HR solution," said Ms. Scholl. "In the mid- to long term, Web-based services will come to dominate the HR outsourcing market as a result of the decentralized nature of many HR processes. As the concept of boundaryless employment expands, the Internet will become even more critical." | |||
| Additional information on this market is available in the Dataquest Focus Report titled "Demand Analysis of Integrated, Multiprocess HR Outsourcing" (published September 20, product code BPOT-NA-FR-9901). This report examines the current trends and outlook for HR outsourcing. Based on a recent survey by Dataquest, the report examines the key drivers for the market and the inhibitors for the industry. | |||
| Dataquest's Business Process Outsourcing North America program delivers timely, accurate and actionable research and consulting services on BPO opportunities to support the plans of established market leaders, niche providers and new market entrants. Additional information on this program is available on Dataquest's Web site at: http://www.dataquest.com/public/static/home/ourservices/scopes/n06bpotna.html. | |||
| To subscribe to this program, please call 800-419-DATA, or 408-468-8009. More information about Dataquest's programs, descriptions of recent research reports and full text of press releases can be found on the Internet at http://www.dataquest.com. | |||
| GartnerGroup's Dataquest is the recognized leader in providing the high-technology and financial communities with market intelligence for the semiconductor, computer systems and peripherals, communications, document management, software, and services sectors of the global information technology industry. | |||
| GartnerGroup, the world's premier business technology advisor, provides unrivaled thought leadership for more than 9,000 client organizations worldwide. With 1999 revenues of $734 million, GartnerGroup was founded in 1979 and is headquartered in Stamford, Connecticut, with 80 locations worldwide. GartnerGroup's 3,400 associates including 1,200 research analysts and consultants, help clients achieve their business objectives through the intelligent and efficient use of information technology. For more information about GartnerGroup's industry-leading research capabilities, consulting and measurement services, and world-renowned symposia and events, please visit us on the Web at www.gartner.com. | |||
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