Development and test of a model of external organizational commitment in human resources outsourcing

Abstract

Most prior outsourcing studies in the human resources domain have focused on the initial decision for outsourcing HR activities. Hence, little is known about HR managers' commitment to continue an already existing outsourcing relationship. This study constitutes a first step to increase our understanding of the factors related to the continuity of HR outsourcing relationships. We developed and tested a model of HR managers' (N = 186) commitment in outsourcing relationships. Affective commitment or the desire for the outsourcing relationship to continue was related to the depth and frequency of HR outsourcing. Conversely, continuance commitment, which refers to the constraints that keep the outsourcing relationship intact, was not related to the continuity of HR outsourcing. Finally, affective commitment was fostered by HR managers' perception that HR vendors shared the same values for managing people. © 2008 Wiley Periodicals, Inc.

Human Resource Outsourcing: Long Term Operating Performance Effects From The Providers Perspective

“…Our results provide insight into factors influencing the profitability of HR service firms. Small providers serving large clients show significantly improved operating performance in the long term, suggesting that small providers engaging large clients are able to experience benefits resulting from a trusting relationship with the client (Lievens and Corte, 2008) and from exploiting economies of scale. In this study, we extend HRO research by examining overall performance metrics of human resource service providers as well as the provider/client pairing as suggested by Lievens and Corte (2008).…”

“…Outsourcing literature traditionally relies on transaction cost economics (TCE) to hypothesize outsourcing decisions and results (Lievens and Corte, 2008). Transaction cost economics proposes that firms consider asset specificity, uncertainty, and frequency of an activity in choosing to perform functions in-house or to contract with an external service provider (Williamson, 1979(Williamson, , 1991.…”

“…Small providers are likely to pay more attention to the client because the client represents a larger portion of their revenues (Feeny et al, 2005;Rottman and Lacity, 2008), especially when the client is a large firm. Additionally, small providers have an incentive to cultivate positive relationships with clients to signal trustworthiness to other potential clients, thereby increasing their future business opportunities (Lievens and Corte, 2008). Small providers are also more likely to offer unique specialized services than large providers, which can enhance their bargaining power and profitability (Grossman and Helpman, 2002).…”

The pursuit of HR outsourcing in an emerging economy: The effects of HRM strategy on HR labour costs

“…In fact, such an organization keeps most of its HR activities in house, and to enhance employee commitment and loyalty, the organization offers extensive compensation and benefits packages as well as substantive training and development. For such an organization, it is illogical to have outside providers performing its HR function, which might have adverse psychological and social implications on its employees (Lievens & De Corte, 2008). An organization with a strong commitment HRM strategy is therefore likely to perform most aspects of the HR function in-house.…”

Human Resource Outsourcing Success

“…As HR outsourcing development in Malaysia has not been intensively studied, managers may still have lack of knowledge on how to select the right service providers and how to manage the outsourcing relationship (Ee, Abdul-Halim, & Ramayah, 2013). To many organizations, managing the relationships between organizations and service providers has become increasingly complex because both parties may have different desires and agenda when developing and maintaining HR outsourcing relationships (Ates, 2013;Lievens & Corte, 2008). Furthermore, the inadequate choice of outsourcing partners can also impede the success and quality of outsourcing relationship (Elmuti & Kathawala, 2000;Tapiero, 2006).…”