Introduction

The HRO industry is at an inflexion point. Traditional models are being challenged and new models continue to emerge around value proposition (e.g., quicker ROI-led transformation), solution design (e.g., componentized, platform/SaaS based, etc.), or service delivery (e.g., global sourcing-leveraged). At the same time, the boundaries between multi-process HRO (MPHRO) and single-process HRO (SPHRO) markets continue to blur and the supplier landscape continues to change rapidly. Such a point in the market evolution provides unique opportunities for suppliers to make strategic moves that can help them move ahead of the competition. Arguably, newer suppliers are in a better position to tap such opportunities as they lack the burden of legacy operations and existing investments weighing them down. However, this also calls for making bold moves with an appetite to take calculated risks.

Among the newer HRO suppliers with deep-pockets, India-heritage suppliers such as Infosys, TCS, Wipro, and HCL are the prominent ones. While these suppliers continue to make a concerted effort to build their HRO business organically, it is still quite small compared to more established suppliers. Among other factors, their limited scale continues to be a hindrance in terms of staking their claim and winning large HRO opportunities.

This raises a couple of strategic questions for them. Should India-heritage suppliers make inorganic moves to fill in the key gaps in their offering and scale up their business? In light of several recent acquisitions made by their competitors in the HRO space, have they missed some of these opportunities?