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Trust Your Own Vendor Research
"Who you gonna believe -- me, or your own eyes?" There are books aplenty telling us that everything we need to know we learned in the first grade. While I am not a believer in that statement, there are some first principles that have been summarized by others better than I can restate them, so I am borrowing my first line from a great American philosopher of the common man -- Groucho Marx. The serious issue behind this catchy phrase is the need for HR professionals to verify, validate and investigate, in gruesome detail, the actual capacity of providers rather than to accept promises and hopes. We are the trustees of employee service and we owe it to our fellow employees and our directors and shareholders to do the most careful job possible of verifying service capacity. We have recently seen projects struggle and then unwind and move to different providers for a host of reasons. In most of these projects, the underlying theme is that the providers involved were not committed to the business in the longer term and clients failed to understand that risk. ExcellerateHRO has dropped out of the comprehensive HRO market and is terminating services to its primary client. Fidelity Employee Services is retreating from the large-client comprehensive HRO service market as well. In both cases, well-meaning business people intended for their companies to get into the business and stay there. Clients believed those statements. Before taking sales-motivated statements about dedication to the market at face value, there are a number of things clients must do. Business conditions will change, but there are indicators of whether a company is truly dedicated to the HRO marketplace. Clients need to put teams in place to verify the following factors on an annual basis: * Does the systems architecture and capital spending on human resource information technology of the provider support the principle that the provider is scaling for increased volumes in a best-of-breed HRIT environment? * Are the service centers and call centers diversified as to location? Are they growing both in numbers of employees, language capacity and process service profile? * Is the executive leadership of the company capable of growing the business or are they caretakers of an eroding profit center -- or worse, a consistently loss-making business? * Is the provider building out its service capacity? Is it acquiring specialty expertise it may be lacking by buying learning expertise or learning-management systems, or claims-process expertise in medical-claims administration? * Are the delivery elements of the provider visible in the marketplace at trade shows, on panels, in white papers and articles, or is it only the sales force of the provider that is visible? The pain and cost of going through a provider retreat are substantial, and we need to do everything we can to avoid that. We have an ongoing duty to find out the facts for ourselves and get the best market intelligence out there. Then we have to have the courage to believe in our own conclusions. Groucho really said it all. Lowell Williams > is executive director of HR Advisory Services for EquaTerra, a BPO consulting firm based in Houston. He can be reached at < lowell.williams@equaterra.com. October 16, 2009 Copyright 2009© LRP Publications |
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© Copyright 2012 LRP Publications. All rights reserved.
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