Today's blog comes from Jeff Krynski, Governance Competency Leader, CHRO Services, TPI.
Successful HRO management starts and ends with people. No shock there. But if you look at companies that set up a provider management function, you'll see they stand a much higher chance of having proven, best-practices in place and a higher success rate than those that don't. That's why getting the right team and structure in place before the service provider selection process is an imperative.
A provider management advisory partner helps companies that require a swift, sure, cohesive action plan to navigate the complexities of HRO. The success of any HRO relationship depends not only on implementation, but on the development of a disciplined approach during the strategy and assessment phase, and its management moving forward.
HRO success starts with a strategic provider management team. The size and structure of a provider management team that oversees the outsourcing arrangement depends not only on the size and complexity of the sourcing relationship, but on the framework of internal organization as well.
Each provider management organization should possess a framework for clarifying the workload and skills that need to be fulfilled, which includes:
- Performance management - ensuring the right work is done right
- Cost management - managing and validating those functions that impact the cost of the service
- Contract administration - ensuring compliance over the term of the service provider relationship
- Relationship management - encompasses direction setting and assuring satisfaction with the Provider management function
The HRO provider management team roles are not necessarily mutually exclusive, as many components or roles may overlap and thus may be effectively maintained with fewer resources. And even though the responsibility for providing quality service falls to the service provider, the company outsourcing is tasked with overseeing the relationship.
At the end of the day, outsourcing demands a paradigm shift, and you'll have to give serious consideration to the resources assigned to the provider management function.