Outsourcing Times

Offshoring Has Benefits Beyond Saving Labor Cost

Offshoring delivers more than just labor cost savings and a good offshore strategy generates new revenues, increase capital productivity, and manage risk. But in many sectors, relatively few executives are acting on this knowledge. This, despite leading companies showing where the gains can be made. Mckinseyquarterly.com reports:

One reason for the lag is that many executives don't fully recognize the potential for generating revenues and cutting costs through offshoring—or through broader strategies that combine it holistically with other restructuring initiatives.

Read more: Taking offshoring beyond labor cost savings

Daimler Plans Accounting Outsourcing

DaimlerChrysler AG has decided to outsource some of its accounting work to lower-wage countries as part of its restructuring program. This move has been opposed by automakers works councils. The company is officially considering locations such as Czech Republic and India for outsourcing some of the company's accounting work. The works' council is against the outsourcing and maintains that the automaker's new plans should not be outsourced. Daimler has been negotiating for the last two months. It is also developing a social and compensation plan for large-scale administrative restructuring. DaimlerChrysler is planning to cut about 6,000 positions worldwide.

According to Forbes -

The automaker wants to begin implementing the restructuring in August with 60 pct of the changes to be made by the end of 2006. But the works council has threatened to veto the plans: 'We are saying without a balance of interest this simply won't fly,' Klemm said.

TALX Corporation to Demonstrate its Payroll Outsourcing Services

TALX Corporation announced the details of its involvement at the 24th Annual American Payroll Association Congress in Orlando. The company has decided to highlight its industry expertise and outsourcing services. According to TALX sources, it will host two sessions on Payroll/HR Self-Service Internet and Portal Technologies. Finanzen reports:

As a leading provider in the HR and payroll industry, TALX always welcomes the opportunity to educate, talk about state-of-the-art resources available to assist industry associates, and explore solutions directly with attendees and organizations.

Rheinmetall and IBM enhance scope of existing contract

Rheinmetall, the German automotive components firm, and IT major IBM have expanded the scope of their existing deal to include business transformation outsourcing services. The renewed agreement will take shape  with immediate effect with a transition phase lasting until the completion of the year 2006. TMCnet reports:

The 13m, seven-year contract covers the outsourcing of payroll accounting for Rheinmetall Defence and services in connection with occupational pensions for Rheinmetall Group.

Fidelity's human resources and payroll outsourcing drives growth

Fidelity Investments has reported that its payroll and human resources outsourcing businesses reached record levels for the second straight year, and now makes up about one-third of the company's revenue.  CNN Money reports:

Fidelity also expanded its human resources and payroll outsourcing business at a time many corporations are trying to save money, leaving the sending of pay stubs and keeping track of workers' benefit records to outsiders like Fidelity.

"HR and payroll administration is the fastest growing part of our business as we've nearly tripled the number of employees and retirees services in the past 18 months," Peter Smail, president of Fidelity Employer Services Co. said about the outsourcing business.

Read more: Fidelity's outsourcing biz hits record