HR business process outsourcing (BPO) continues to grow in popularity and is reaching the mainstream in terms of adoption. HR BPO is the fastest-growing segment of HR services. IDC forecasts the market to increase at a CAGR of 16% in the United States to almost $16.5 billion by 2009. This spending is not just at the high end of the market. More mid-market firms are also turning to HR BPO as a strategy to reduce costs and redundancy and to gain access to technology that they do not have today. Automatic Data Processing (ADP) offers mid-market and larger firms an HR BPO solution called Comprehensive Outsourcing Services (COS). Song Airlines, Acuity Brands, and Credit Suisse First Boston have all implemented ADP COS and have realized a variety of quantitative and qualitative benefits:
Song was founded by Delta Air Lines in 2003 to provide a low-cost alternative to other emerging low-cost airlines. Song opted to do things differently than Delta, including its approach to HR management. The key challenge was time. Song had just three months to implement ADP COS to produce its first payroll by April 2003. The airline also had an aggressive plan, which it successfully achieved, that called for going live with payroll, benefits, self-service, time-keeping, flexible spending accounts (FSA), and record-keeping simultaneously. Song has realized a variety of other benefits, including a very economical HR-to-employee ratio and a fully paperless environment.
