Human Resources Outsourcing by Alison J. Glaister

Introduction

The present paper is devoted to the analysis and critique of human resource management (HRM) article that dwells on the topic of HR outsourcing and its impact on HR role development. The general information and the key ideas of the article are presented, and three of its claims are discussed. In particular, the issue of HR roles changes, strategic HR underdevelopment, and the impact of HR outsourcing on HR are addressed with the help of external sources.

The topics were chosen since they are interconnected and allow an insight into the process of HR role development and its correlation with the development of a new HR form, HR outsourcing. It is concluded that the change in the HR role is thrust upon HR without proper guidelines and considerations, which results in role overload and the underdevelopment of some of its components, for example, strategic HR. Outsourcing is an attempt at bridging the gaps between HR functions, and even though its effectiveness is disputable, it has the potential of helping HR to deal with its multiple roles.

Article Critique

General Information

The article by Alison J. Glaister (2014) is titled “HR Outsourcing: The Impact on HR Role, Competency Development, and Relationships.” It contains a study devoted to the analysis of HR outsourcing and its consequences as seen by senior HR professionals. The study consisted of 27 semi-structured interviews and was aimed at the comparison of outsourced and “in-house” HR departments. The investigation included questions on the development of the role of HR, the skills associated with it, and the intent to proceed with either internalization or externalization.

Key Ideas

Glaister (2014) defines HR outsourcing as “placing HR activities outside an organization’s boundaries” (211). The author states that this kind of outsourcing is currently gaining popularity and appears to be developing faster than any other segment of outsourcing. The reason for this popularity consists of the flexibility and efficiency of HR outsourcing that is advantageous in the currently turbulent economic environment. Glaister (2014) also insists that modern outsourcing practices are aimed at the enhancement of strategic HR role, but fail to free HR from the “traditional administrative roles” (213). At the same time, the author is certain that HR has the potential for strategical involvement in decision-making, but outsourcing is not helpful in this respect.

There are several crucial points in the article. First of all, the interviews provide evidence to the idea that outsourcing outsourcers distance themselves from traditional team development work, which limits their role to be able to respond to the demands of their organization in the terms of providing HR. This aspect corresponds to the requirements of the senior management teams that appear to neglect the integration of HR and prefer to focus on its involvement. Such an approach is in line with general economic tendencies, but it does not consider the specifics of HR. As a result, outsourcing has improved the credibility of HR and helped the senior management team to take it “more seriously,” but also led to a lower level of HR autonomy (220).

Non-outsourcers and the author insist that the HR role needs to be revised so that HR becomes more strategically involved. The author concludes that outsourcing poses a danger for the traditional and potential roles of HR; it can only be used together with proper management through a “strong” internal HR team that articulates the vision and prevents role fragmentation (223).

Critique: The Roles of HR

Since the article is primarily concerned with the roles of HR, it appears logical to dwell on this aspect. Glaister (2014) suggests that modern HR is being pressured into using “Ulrich’s HR business partner model” that includes “four key areas – administration, employees, strategy and change” (213). It should be pointed out that the author appears to believe in the need for every one of these roles, but the choice of the word used to describe the process (“pressure”) attracts attention.

This word selection does not appear to be accidental. The Ulrich’s model has been around for about twenty years, and as the modern HR struggles to develop all the suggested roles, it is being diagnosed with role overload and role conflict more and more often (Sheehan et al. 2016). Sheehan et al. (2016) recite the functions that Ulrich and modern business demand of HR: HR professionals are supposed “to become strategic partners, administrative experts, employee champions and change agents” (355). According to the authors, attempts at unifying the functions have been made: apparently, it is acknowledged that their number is too impressive.

Still, modern HR is expected to improve administrative efficiency, facilitate change and strategy development, develop human capital and protect the rights of the employees as well as the company from the employees at once. It is not surprising, therefore, that the model and its interpretations have been widely criticized for being “both simplistic and problematic” (Sheehan et al. 2016, 355). It states the concepts of the roles, but it does not provide clear guidelines for achieving them or the required skills and knowledge.

The model of multiple roles, therefore, does appear to be artificial, underdeveloped and thrust upon HR without proper preparation, which results in numerous problems (for example, the difficulty of strategic incorporation of HR that is considered in the following part of the paper). What is more, the attempts at fulfilling all the mentioned roles result in imbalances and can lead to the discretization of HR in case all of them suffer from the stretch of attention. To sum up, I tend to agree with Glaister’s (2014) claim, according to which HR is being pressured into the four-role model.

Critique: Strategic HR

Glaister (2014) asserts that “HR tends to remain confined to traditional administrative roles” and “excluded from decision making” (213). The author insists that “HR’s strategic involvement is weak,” which limits the contribution of HR to a company’s success (213). This opinion appears to be quite common among HR theorists and practitioners. Ghalamkari et al. (2015) explain that even the term “strategic HR” remains unclear and undefined.

The feature of strategic HR that appears to be generally accepted is its goal, which consists of the creation and practicing of HR policies that can empower human resources to contribute to the fulfillment of the company’s strategy and realization of its goals (Ghalamkari et al. 2015, 119).

However, this is a theoretical interpretation: Ghalamkari et al. (2015) present only the conceptual framework, which could help the development of strategic HR, and do not provide any practical example of its implementation. Similarly, Sheehan et al. (2016) insist (while also citing other researchers) that the “strategic presence of HR professionals is underdeveloped, and they remain caught up with operational tasks” (356). Therefore, it is possible to agree with Glaister’s (2014) claim that strategic HR is yet to be developed. The author describes HR outsourcing as an attempt to overcome this issue but doubts its success.

Critique: The Impact of Outsourcing on HR

Glaister (2014) concludes that the positive consequences of outsourcing are limited while its negative impact is significant: according to the author, it “stymies HR role transformation” (211). The logic of this conclusion is explained above. The author demonstrates that outsourcing is essentially an attempt at developing strategic HR, but according to her, it fails in achieving the goal and makes the correction and expansion of HR roles more difficult. What is more, Glaister (2014) insists that the strategic value of outsourcing is almost non-existent, limited to a decorative function of what is not strategic HR but merely looks like it (211).

This claim is very controversial. It is explained by the author’s study, but it may be pointed out that the sample (27 HR professionals) can be insufficient to make significant generalizations. Reichel and Lazarova (2013) carried out a study with a much larger sample (Cranet database that includes surveys from HR professionals of 17 European countries; the author’s used information concerning 2,688 companies) and studied the effects of outsourcing (934-937).

Their conclusion consists in the idea that the outsourcing of the non-core, routinize HR activities (for example, payroll) does lead to the improvement of the strategic position of the HR department as it serves to free their resources for non-routinize, core activities (for example, the development of the human capital of the company). Apart from that, the authors conclude that the outsourcing of core activities does not influence the position of the in-house HR departments at all. This research provides significant evidence to the idea that outsourcing does have the potential for improving the position of HR, developing its strategic potential, and helping HR deal with the multiple roles thrust upon it. Therefore, the claim of Glaister (2014) concerning the danger of outsourcing appears to be too hasty and harsh, and agreeing with it seems to be impossible.

My Voice: A Personal Point of View

In my opinion, which is admittedly influenced by the mentioned works, the roles that are expected from HR are extremely challenging to balance, which is bound to lead to underdevelopment of some or all of them unless they are properly managed. Outsourcing, in this respect, appears to be a viable tool that is capable of assisting in HR role management. However, it should be pointed out that Glaister’s (2014) opinion on the dangers of outsourcing is not ungrounded. While the author appears to be opposed to the idea of outsourcing as such, she seems to agree with the possibility of outsourcing in case the core competencies of HR are not outsourced.

While the study of Reichel and Lazarova (2013) appears to indicate that it is not dangerous to outsource core activities as well, the reason behind such a suggestion is clear. Core activities are of greater importance for a company while non-core ones can be regarded as a burden that may and should be outsourced to save HR resources for more significant tasks. To sum up, it appears that outsourcing is a viable tool that can be used properly to the advantage of the company and improperly with little or no benefit. The specific guidelines for its usage are most certainly company-specific, but the general ones deal with the proper management of the core and non-core activities of HR.

References

Ghalamkari, Bahare, Negar Mahmoodzadeh, Nouredin Barati, Aliyu Isah-Chikaji, Ahmed Umar Alkali, and Roya Anvari. 2015. “The Role of HR Managers: A Conceptual Framework.” Asian Social Science 11 (9): 118-124. Web.

Glaister, Alison J. 2013. “HR Outsourcing: The Impact on HR Role, Competency Development and Relationships”. Human Resource Management Journal 24 (2): 211-226. Web.

Reichel, Astrid, and Mila Lazarova. 2013. “The Effects Of Outsourcing And Devolvement On The Strategic Position Of HR Departments”. Human Resource Management 52 (6): 923-946. Web.

Sheehan, Cathy, Helen De Cieri, Brian Cooper, and Tracey Shea. 2016. “Strategic Implications Of HR Role Management In A Dynamic Environment”. Personnel Review 45 (2): 353-373. Web.