Introduction

After a dip in 2008, the multi-process HRO (MPHRO) market has gained significant momentum in 2010 through new deal signings and renewals. However, the average contract size and contract length of the MPHRO deals continues to decrease. Given the cautious optimism prevalent in the market, buyers need to rigorously track the adoption trends, deals characteristics, service provider landscape, and assess service provider capability along key dimensions such as scale, scope, technology capability, and global delivery footprint. There is a stiff competition among several service providers in terms of market share. In such a competitive service provider landscape, buyers would need to track the performance of providers in relevant segments and assess each service provider’s capability along with above mentioned key dimensions. Everest updated its classification of 15+ MPHRO service providers on the Everest HRO PEAK Matrix (Performance | Experience | Ability | Knowledge). Everest has also identified five service providers as the “2010 MPHRO Market Star Performers”.

In this research, we analyze the global MPHRO service provider landscape and its impact on the MPHRO market. We focus on:

• Market and service provider overview
• Service provider major trends in 2010
• Service provider share analyses
• Service provider capability assessment and market performance

Scope of analysis

• All HRO contracts signed as of November 2010, 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 industries
• 15+ service providers that have signed at least one HRO transaction. Service providers covered include Accenture, ADP, Capita, Capgemini, Ceridian, Genpact , HCL, HP, Aon Hewitt, IBM, Infosys, Logica, Neeyamo, NorthgateArinso, TCS, Wipro, and Xchanging

Content

This report examines the dynamics of the global MPHRO service provider landscape and its impact on the MPHRO market. It gives an overview of the market and the service providers, analyzes the key upcoming trends - their reasons and implications, evaluates market shares and provides an assessment of delivery capabilities of 15+ leading HRO service providers. Some of the key findings are listed below:

• A substantial drop in terminations, coupled with a significant number of extensions, points to the stabilization of the market and improved buyer satisfaction
• Several trends evolved in the 2010 MPHRO market:
  • The MPHRO market witnessed several strategic acquisitions in 2010.
  • Many service providers have entered the single-process HRO (SPHRO) market in areas such as payroll, benefits, recruitment, and learning
  • During 2009-10, several service providers created advanced platform-based offerings to eliminate/minimize the requirement for up-front investment
  • With changes in demand, service providers are more flexible intheir target market definition
  • Service providers continue to invest and expand their offshore capabilities
  • With significant end-of-term activity in the next couple of years, service providers will look forward to capture these opportunities
• Overall, ADP accounts for more than one-fourth of the total number of deals signed to date. In terms of ACV, there is stiff competition. Currently, Aon Hewitt and NorthgateArinso have a combined share of 32% of the market
• Everest updated its classification of 15+ MPHRO service providers on the Everest PEAK Matrix (PEAK – Performance | Experience | Ability | Knowledge) into the categories of Leaders, Major Contenders, and Emerging Players.
• Our assessment shows clear differences among service providers along the different dimensions of delivery capability assessment
• Everest identified five service providers as the “2010 MPHRO Market Star Performers”