E-sourcing combines outsourcing and the power of Internet to create exciting new ways to reduce costs, improve customer service and build shareholder value.

Today, Business Process Outsourcing (BPO) is the new mantra in the business world. More and more companies are now looking to trim down employees on their payroll, and therefore, HR outsourcing is slowly becoming the new buzz in India.

Outsourcing is no longer the privilege of big multinational organizations. Now even the public sector and government undertakings as well as medium-sized or start-up companies are going for outsourcing their HR-related activities.

The HR outsourcing industry is expected to grow from $13.9 bn in 1999 to $50 bn in 2004, according to the market research firm Dataquest. In India, the latent size of HR outsourcing is about $2 bn with a current market of $27 mn, and it is growing at a rate of about 50%. HR outsourcing in India has not witnessed the required momentum. It is limited to a trickle effect, with companies outsourcing a few selected low-end HR processes as compared globally, where HR outsourcing has gone beyond just handling payroll and benefits.

Another issue in HR outsourcing is deciding which HR functions to be offloaded and which firm to outsource them to. This is a big challenge because of the high risks associated with a wrong selection. Also, before going for offloading any in-house HR-related activity to an external agency, a company must weigh the pros and cons of outsourcing. Though there are many advantages of outsourcing HR-related activities, there are some disadvantages too.

Outsourcing, payroll, benefits, Business, Dataquest, Esourcing, functions, globally, government, improve, industry, offloaded, organizations, public, research, shareholder, trickle, witnessed, latent, improve, combines, privilege, momentum, Esourcing, mantra, organizations, shareholder.