29 EXERCISE Outsourcing the Human Resource Management Functions 1. Oejectives A. To familarize you with tbe potential costs and benefits of human resource manageiment outcourcing B. To familiarize you with the degree to which various buman rescarce management functions are being successfully outsourced. 11. OUT-or-Cuss Parranation Timei \$o minutes 111. IN-Cuass Time Sugersted: 30 minules IV. INSTRUCTIONS A. In groeps of three to five students, read the "Situation" below, as well as Forms 2.1 and 22. B. Each group will complete Forms 2.1 and 2.2, as well as Question 1. List as many outsourcing bencfits and costs for both employers and employees as you can on Form 2.1. Put an X beside your group's assessment of the corporate bencfits (form 2.2) of outsourcing each HR function. C. One person in each team will report the group's assessment and recommendations (Question 1) to the chass. Sharon Ormond is the vice president of haman resources for Slicon Electronics, a small electronics company in the Silicon Valley area outside of San Francisco. She has been concerned that their patched-together buman resource information system uses a software program so outdated that Peoplesoft will no longer support it. This morning she met Edward Catter, the CDO of her company, in the parking lot as they were both coming to work Catter told her of a conversation he had with a consultant from Hewitt Associates, Inc., a human resource management consulting company. The consultant said that when the entire haman resource management function was outsourced to Hewitt, they had saved a company similar to his almost $400,000 in human resource managensent costs last year. The consultant abo toll Cutter that a number of bluechip companies have joined the HiR outsourcing bandwagon induding ATQT. Motorola, American Express, and Prudental. Based on that conversation, Cutter then asked Orgood to do some research and let him know whether if made secse to consider cutsourcing some or all of the current heman resource management functions at Sulicon Electronics to Hewitt of a similar firm. Oggood was quite upet after the convenation because she konten ber onm position, as well as posilions of her subordinates, might be in jeopardy. Howevet, affet recoverthg from her initial shock, the alled Mary Gannon, her former professer of Huzan Resources Managemenit at Calornia Sale tiniversity, to solicit her inpat. Professor Gennon told Cegaod she woul get back to her in a week after giving this assignment to one of the atod cat groups in her Human Resources Management class. Your group has been given this assignment. Professor Gannon has asked your group to do the research necesary to complete Forms 2.1 and 2.2 and then answer the question bdow. 1. Complete Forms 2.1 and 2.2 using information gathered from the various human resource Web sites listed throughout this book. Identify as many benefits and costs from both the employer and employee perspective as you can as a result of outsourcing the entire human resource function (Form 2.1). Also consider which human resoutce functions have the greatest potential to be outsourced based on what other companies are doing and why (Form 2.2). On the basis of these assessments, which of the thate strateges shousd Ommond recommend to Cutter and why? Circle either a, b, or c and be a Do not outsource any of the human resource functions. a. Do not outsource any of the human resource functions. b. Outsource only the following human resource functions: c. Outsource all of the human resource functions. HOQM 2.1 Bencfits and Costs Acociated widh Oufseurcing Human Resourco Functions \begin{tabular}{|l|l|} \hline Benefts & tagleyer \\ \hline Cost & \\ \hline & \\ \hline \end{tabular} Enaleyes Geneth cost 164 k