Introduction

As the Human Resource Outsourcing (HRO) market matures beyond the early pioneer phase, value creation opportunities continue to increase along multiple dimensions. Understanding the evolving market dynamics is key for the stakeholders to be successful in this market. This report provides comprehensive coverage of the global 2005 HRO market including detailed analyses on market size, transaction characteristics, buyers adoption, and supplier landscape. This report will assist buyers, suppliers, investors, and technology providers understand the rapidly changing nature of the HRO market and will help them identify value creation opportunities as well as identify potential risks involved. 

Scope

• All human resources outsourcing contracts as of March 31, 2005 with a minimum of three HR functions and servicing more than 3,000 employees
• Global focus: North America, Europe, Asia Pacific, and Latin America
• All suppliers having signed at least one HRO transaction
• All industries
  

Contents

This report examines the global 2005 HRO market and provides insights, detailed analyses and implications for stakeholders along three key dimensions: Market overview and trends; Suppliers, capabilities, and operating models; and Buyers, selection criteria, and experiences. Each dimension is discussed in detail (and illustrated with supporting data and analysis) to provide the reader information in easy-to-apply, bite-size pieces. For example, Market overview and trends offers the following insights, among others: 

• Overall size & growth
  • Growth remains strong; with annual HRO spend growing at a CAGR of 34% in the past five quarters
  • 60-80% of the market has been US-based transactions
• Transaction characteristics
  • Average TCV is shrinking as a result of the increased number of smaller transactions
  • Approximately 65% of existing contracts are up for renewal in or before 2010
• Technology
  • While ERP-based solutions still dominate the HRO market, there has been significant growth in proprietary solutions
  • Proprietary solutions are dominant for local transactions; PeopleSoft leads for regional transactions, and SAP for global transactions