Outsourcing Term Paper Example | Topics and Well Written Essays - 500 words

Outsourcing - Term Paper Example Human resource department is usually not the basic area of operations of a company therefore costs associated to this department are usually high. All companies are not able to operate their HR departments efficiently. Outsourcing gives the HR department in specialist hands. Employment associated risk like employee law suits are reduced as a result of HR outsourcing (Benefits of Outsourcing, 2011). Lawsuits can cause financial problems for the firm and can also tarnish the reputation of the company. HR outsourcing to a specialist firm can also enhance the performance of hired employees. HR firms provide training for employees and this is the reason of increased performance. There are also problems associated with HR outsourcing. By outsourcing an important division of the company like human resource a divide between firm’s objectives and employees may happen. Employees should be hired keeping in mind the overall goals of the company and organizational culture. HR outsourcing may also be a problem because it may involve risking inside information to outside people. Company will have to inform the HR firm about its future plan in order to tell them what kind of employees they want to hire. This will involve risking inside information to other companies. United Parcel Services is a well known example of outsourcing HR. The company has outsourced its human resources to eight different Human Resource Outsourcing companies (Alderton, 2005). The company is a great example as it is using many HR companies at once. UPS has also started communication portals between HR companies and employees so that their concerns are duly noted. PepsiCo is another large name that has outsourced its HR department (HRO Today 2009). The company thinks that HR outsourcing blends well with its operations. PepsiCo has outsourced benefit administration and contact center support to a HRO firm. This shows that