Abstract.Recently, increased attention has been paid to partnership quality in outsourcing strategy. However, research of partnership quality on the outsourcing of human resources (HR) is very limited. Therefore, this research aims at examining the relationship between partnership quality variables (business understanding, trust, commitment, communication and top management) and the success of HR outsourcing. The sample is obtained from a cross sectional survey and the sample studied are 96 manufacturing organizations in Penang, Malaysia. Results indicate that most of the organizations that outsourced HR functions were from electronic and electrical industry. The analyses also show that partnership quality variables such as trust, business understanding and communication have significant positive impact on HR outsourcing success. The study concluded that HR outsourcing as a competitive strategy in Malaysia is still relatively new and probably many of its potential benefits are not fully understood. Therefore, by understanding the relationship with the service providers, the organizations are able to achieve outsourcing success by identifying areas of expected benefits and improvements.
This paper examines the consequence of the organization internalization on the practice of human resource (HR) outsourcing among manufacturing organizations. The assumption is that HR outsourcing is perceived as an innovative practice and that multinational enterprise (MNEs) will employ this practice more than local organizations. The data was gathered from survey questionnaires of 232 manufacturing organizations. Of the sample, 113 organizations engaged with HR outsourcing, and 71 are MNEs that partially outsource their HR functions. The findings reveal that HR outsourcing among MNEs is used to a greater extent than local organizations. A significant difference is found in the extent of outsourcing payroll, benefits, training and recruitment between MNEs and in local organizations. ABSTRAK Tulisan ini memeriksa konsekuensi organisasi internasional dalam praktik bagian outsource sumber daya manusia (SDM) dalam organisasi manufaktur. Asumsi awal yaitu bahwa SDM outsource dianggap sebagai praktik inovatif and bahwa perusahaan multinasional akan mempekerjakan praktik ini lebih banyak daripada perusahaan lokal. Sebagai contoh, 113 organisasi mempekerjakan SDM oursource dan 71 di antaranya adalah perusahaan multinasional. Jumlah tersebut mengungkapkan bahwa SDM outsource diantara perusahaan multinasional menunjukan jumlah lebih besar daripada perusahaan lokal. Perbedaan signifikan ditemukan dalam perpanjangan gaji outsource, benefit, training, dan rekrutmen antara perusahaan multinasional dan lokal. Kata kunci: outsource, sumber daya manusia, perusahaan multinasional 2
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