Source: dnaindia.com

Local vendors won four of the 39 such deals globally

Human resource outsourcing (HRO) is seen as the next big thing for Indian BPO firms that are looking to expand the scope of their service and reach.

Under such deals, companies can outsource various HR functions such as payroll, recruitment, employee data management etc. A typical deal is of six -seven year duration.

“Of the 39 global enterprise (end-to-end) HRO deals announced last year, Indian vendors won four orders at a cumulative deal size of $350-400 million. This number is impressive, since this was the first year when Indian vendors have won enterprise HRO deals,” Rajesh Ranjan, director, Everest Research, an off shoring advisory firm said.

The four firms are Tata Consultancy, Wipro, Caliber Point (a subsidiary of Hexaware Technologies), and Infosys.

The HRO market can be broadly classified into discreet HRO and enterprise HRO, with the former involving outsourcing of a single process and the latter being end-to-end.

HRO as a concept took life only about a decade ago and is already a $3 billion opportunity, growing at 13-14% annually. Hewitt, Convergys, Accenture and IBM. The discreet HRO market, although several times the enterprise market, is highly fragmented.

Ranjan said many Indian and India-based companies were looking at a partnership model to tap this opportunity. “Ceridian, a US-based HRO firm, has tied up with Gurgaon-based Genpact to have an offshore presence. This is route more and more Indian companies could take,” he said.

Ranjan said an encouraging thing about Indian companies winning HRO deals was that, most of these were in Europe.

“Three of the four deals were signed in Europe. By value, it is 80% of the total contract value. This signifies the kind of risk diversification Indian companies are undertaking. The Indian vendors are not just leveraging India for such deals but are also using their delivery centre in Eastern European countries to service the accounts,” he said.

At 33% compounded annual growth rate (CAGR) over the last two years, the Europe HRO market is growing at twice the rate of US, but on a lower volume.

The fact that India is becoming an important destination for HRO is clear from the fact that the segment has about 7,000 people working for it, against almost nil a few years back. “Thirteen leading global HRO firms have a presence in India. The 7,000 employees they hire in India represents half the total offshore employees of HRO firms,” he said.

Source: legaltimes.typepad.com

Law firms looking to cut costs by outsourcing their legal support services overseas could be jeopardizing their client confidentiality, according to a recent federal suit filed by a Bethesda, Md. firm.

Joseph Hennessey, name partner at Newman McIntosh & Hennessey, turned to the U.S.

District Court for the District of Columbia on May 7 seeking a ruling on the outsourcing of privileged client data that may be subject to eavesdropping by the U.S. government.

Hennessey, who in 2005 wrote this column for Legal Times on the Fourth Amendment and privacy rights, says foreign companies have no presumption of privacy because the National Security Agency is free to spy on them without constitutional constraints.

“We are really heading toward a collision between globalized economic interests and the limited extension of constitutional rights,” Hennessey says.

The lawsuit names President George W. Bush as a co-defendant along with Acumen Legal Services of India and its U.S. subsidiary, Acumen Solutions of Houston, Texas.

The firm is looking to the court to rule on whether outsourcing of legal services compromises constitutional rights and whether consent should be required before such data is sent abroad. It also wants the court to order law firms to disclose their use of foreign legal support and to order that the government establish protocols to shield attorney-client information from surveillance.

“It seeks this declaration knowing that foreign nationals who reside overseas lack Fourth Amendment protections,” says the firm’s complaint for declaratory judgment and injunctive relief. “It seeks this declaration having been informed … that the United States government engages in pervasive surveillance of electronically transmitted data.”

Hennessey, who also has filed requests for opinions with the D.C. Bar and the Maryland State Bar Association, says Acumen solicited his company via emails earlier this year.

“It’s not paranoia. It’s just fact,” Hennessey says. “Now that we’re outsourcing services, we have given no consideration to the ongoing practice of the government harvesting information out there.”

He says he’s also concerned that information from his firm, which especializes in personal injury and medical malpractice, could — through discovery — fall into the hands of competitors who employ outsourced services.

District Judge Colleen Kollar-Kotelly, who also is chief judge of the Foreign Intelligence Surveillance Court, has been assigned to the case. A representative for Acumen’s corporate headquarters in India had no comment.