Issue link: https://www.e-digitaleditions.com/i/73199
Strategic Sourcing 8. Which processes and activities can be outsourced in future? 9. How do you evaluate the efficiency, knowledge, and skills from service providers vs. the internal organisation? 10. How do you benefit from larger economies of scale than your own organisation can provide? 11. How do you organise a service provider selection process? 12. What conditions should be set for a proper request for proposal (RFP) document? 13. What are the criteria for selecting suppliers for the long list? 14. What are the most important evaluation criteria? Strategic Sourcing To define the optimal sourcing form depends on the strategy of the organisation. To illustrate this statement, we can take a retail organisation as an example. Branding is very important for a retail organization, as it has a direct effect on how many people visit the stores. A retailer receives thousands of job applications per day, and the way these applicants are treated is very important. Directors of HR shared services centres (SSCs) say: "If you don't properly follow up on all these applicants, chances are that this becomes a popular discussion topic at birthday parties. If this happens once or twice, the consequences are not tremendous, but with our volume of applicants we cannot afford to have a lousy follow-up." For Ahold the basic question—what is strategic and what is not—was an important element in the approach. To outsource a large part of the HR administration to an external provider was a strategic choice. Ahold Europe wanted to encourage store managers to be, in the first place, store managers. A heavy burden of administrative processes was not in line with this principle. A second important criterion underlying the choice was Ahold Europe's growth strategy. With varying volumes, international growth, and new markets, Ahold needed a lot of flexibility in its supporting processes; they needed to be standardised, efficient, scalable, and transferable. These were the two strategic driving forces which led Ahold Europe to reconsider sourcing strategy. When considering external developments, we determined that if we wanted to achieve our mission and ambitions, we would have to exploit internal and external competencies to the maximum. And outsourcing our operational HR service activities provided us with the right service model to meet our objectives. All of this indicates that sourcing is an instrument to support a strategy, instead of a goal on its own. However, it is not an instrument which should be taken lightly, as the choices which are made have implications for at least five years and which could result in a totally different way of working, not only for HR, but for the entire organisation. Making the Right Choice When the strategic framework is explored and aligned with HR strategy (see Fig. 3.3), the main ingredients are in place to make a right choice on how to source HR processes. As a first step, in 2009 an HR operating model was defined, which indicated which services HR delivers and how the service delivery has to take place. Distinctions were made among HR business partners, expertise, and services, and an inventory was made of the scope of the processes performed by HR services and their supporting systems. Obvious choices for HR services were the supporting IT platform and transactional processes such as payroll and administration. [39] HRO TODAY GLOBAL | SPRING 2012