Risks and Rewards in HR Business Process Outsourcing

Managers have expressed differences of opinion about the risks and rewards of outsourcing companies' human resource activities, including the entire business process. This paper reviews the literature to date and studies the example of one of the earliest cases of outsourcing an HR business process, when EDS took on the responsibility for Canadian Imperial Bank of Commerce. With the offloading of functions such as payroll and recruitment, a company's HR department can therefore concentrate on strategy and become a facilitator for change. The paper concludes with lessons that managers can apply when considering the outsourcing of HR functions.