Outsourced cost to perform the HR function per business entity employee

This measure calculates outsourced cost to perform the function "develop and manage human capital" per business entity employee. Outsourced cost refers to the total cost of outsourcing a specific process to a third party, except one-time charges for any type of restructuring or reorganization. Outsourced costs should also include costs for intracompany outsourcing (i.e., reliance on a shared services center or other business entity). The Function "develop and manage human capital" includes [Delivering processes traditionally defined as "human resources". Process groups include those related to developing and maintaining workforce strategy, recruiting employees, developing and counseling employees, managing employee relations, rewarding and retaining employees, redeploying and retiring employees, managing employee information, and managing employee communications.]. This Cost Effectiveness measure is intended to help companies understand this cost expenditure related to the function "Develop and Manage Human Capital".

Benchmark Data

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Measure Category:
Cost Effectiveness
Measure ID:
106467
Total Sample Size:
1,932 All Companies
Performers:
25th Median 75th
- - -
Key Performance Indicator:
No
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Compute this Measure

Units for this measure are dollars.

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Outsourced cost to perform the function "develop and manage human capital" / Number of business entity employees

Key Terms

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Cost effectiveness measures are those in which two related variables, one of which is the cost and one of which is the related outcome related to the expenditure are used to determine a particular metric value.

Full-time Employee

For the purpose of this survey, a regular full-time employee is hired for an indefinite period of time and is normally scheduled to work forty hours per week. Appointment is continuous, subject to satisfactory performance and availability of funding.

Part-time Employee

For the purpose of this survey, a regular part-time employee is hired for an indefinite period of time and is scheduled to work less than forty hours per week.

Temporary Employee

A temporary employee is employed for a finite period of time, to fulfill a time-limited role, or to fill the role of a permanent employee who is absent from work. The length of time an employee can work for the organization and be considered a temporary employee may be governed by employment legislation.

For survey purposes, a business entity is defined as an entity that:

  1. performs significant aspects of the processes for the surveys identified, or
  2. is part of a cost or revenue center within the company.

Within your organization, diverse departments may be geographically co-located, with closely integrated operations that form part of one "business entity" which may be a great distance apart. When trying to determine if related parts of your operation should be considered a single business entity, look for the following characteristics:

  • Do they operate closely together?
  • Do they serve many of the same customers?
  • Do they support the same region or product group?
  • Do they share any performance measures?
  • Is data meaningful at a consolidated level?

Examples of business entity definition:

  1. A general ledger accounting unit located in Germany has two groups. One performs general ledger accounting for the corporate headquarters, which has three business units. The other group does general ledger accounting for one of the three business units. In spite of their geographic co-location, their roles are substantially different and consolidating their data into a single response would make it less meaningful. Each group should be treated as a separate business entity.
  2. Three business units within a corporation use a shared services center for accounts payable and expense reimbursement, but are self-supporting for the other financial processes. The best approach is to make the shared services centre a separate business entity for accounts payable and expense reimbursement, and to retain the three original business units for the other financial processes.
  3. A global manufacturing company has five plant locations, each manufacturing product and each with its own logistics operations. For purposes of completing a manufacturing and logistics survey, they should be treated as five separate business entities.

Measure Scope

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Cross Industry (7.4)

  • 7.1 - Develop and manage human resources planning, policies, and strategies (17043)
    • 7.1.1 - Develop human resources strategy (20958)
      • 7.1.1.1 - Identify strategic HR needs (10418)
      • 7.1.1.2 - Define HR and business function roles and accountability (10419)
      • 7.1.1.3 - Determine HR function roles and structure (21430)
      • 7.1.1.4 - Determine HR delivery model (21431)
      • 7.1.1.5 - Determine HR costs (10420)
      • 7.1.1.6 - Establish HR measures (10421)
      • 7.1.1.7 - Communicate HR strategies (10422)
      • 7.1.1.8 - Develop strategy for HR systems/technologies/tools (10432)
      • 7.1.1.9 - Manage employer branding (20606)
      • 7.1.1.10 - Manage job families and positions (21432)
    • 7.1.2 - Develop and implement workforce strategy and policies (17045)
      • 7.1.2.1 - Perform workforce planning (10423)
      • 7.1.2.2 - Perform operational workforce planning (10424)
      • 7.1.2.3 - Develop compensation strategy (10425)
        • 7.1.2.3.1 - Establish incentive strategy (10210)
      • 7.1.2.4 - Develop succession plan (10426)
      • 7.1.2.5 - Develop high performers/leadership programs (16938)
      • 7.1.2.6 - Develop diversity, equity, and inclusion plan (10427)
      • 7.1.2.7 - Implement diversity, equity, and inclusion plan (21433)
      • 7.1.2.8 - Design talent development program (11622)
      • 7.1.2.9 - Design talent acquisition program (11623)
      • 7.1.2.10 - Develop other HR programs (10428)
      • 7.1.2.11 - Develop HR policies (10429)
      • 7.1.2.12 - Administer HR policies (10430)
      • 7.1.2.13 - Plan employee benefits (10431)
      • 7.1.2.14 - Develop workforce strategy models (10433)
      • 7.1.2.15 - Implement workforce strategy models (20122)
    • 7.1.3 - Monitor and update strategy, plans, and policies (10417)
      • 7.1.3.1 - Measure realization of objectives (10434)
      • 7.1.3.2 - Measure contribution to business strategy (10435)
      • 7.1.3.3 - Communicate plans and provide updates to stakeholders (10436)
      • 7.1.3.4 - Review and revise HR plans (10438)
    • 7.1.4 - Develop competency management models (17046)
  • 7.2 - Recruit, source, and select employees (10410)
    • 7.2.1 - Manage employee requisitions (10439)
      • 7.2.1.1 - Align staffing plan to work force plan and business unit strategies/resource needs (10445)
      • 7.2.1.2 - Develop and maintain job descriptions (10447)
      • 7.2.1.3 - Open job requisitions (10446)
      • 7.2.1.4 - Post job requisitions (10448)
      • 7.2.1.5 - Modify job requisitions (10450)
      • 7.2.1.6 - Notify hiring manager (10451)
      • 7.2.1.7 - Manage requisition dates (10452)
    • 7.2.2 - Recruit/Source candidates (10440)
      • 7.2.2.1 - Determine recruitment methods and channels (10453)
      • 7.2.2.2 - Perform recruiting activities/events (10454)
      • 7.2.2.3 - Manage recruitment vendors (10455)
      • 7.2.2.4 - Manage employee referral programs (17047)
      • 7.2.2.5 - Manage recruitment channels (17048)
    • 7.2.3 - Screen and select candidates (20123)
      • 7.2.3.1 - Identify and deploy candidate selection tools (10456)
      • 7.2.3.2 - Interview candidates (10457)
      • 7.2.3.3 - Test candidates (10458)
      • 7.2.3.4 - Select and reject candidates (10459)
    • 7.2.4 - Manage new hire/re-hire (10443)
      • 7.2.4.1 - Draw up and make offer (10463)
      • 7.2.4.2 - Negotiate offer (10464)
      • 7.2.4.3 - Hire candidate (10465)
    • 7.2.5 - Manage applicant information (10444)
      • 7.2.5.1 - Obtain candidate background information (10460)
      • 7.2.5.2 - Create applicant record (10466)
      • 7.2.5.3 - Manage/track applicant data (10467)
        • 7.2.5.3.1 - Complete position classification and level of experience (20124)
      • 7.2.5.4 - Archive and retain records of non-hires (10468)
  • 7.3 - Manage employee onboarding, training, and development (20599)
    • 7.3.1 - Manage employee orientation and deployment (10469)
      • 7.3.1.1 - Create/maintain employee onboarding program (10474)
        • 7.3.1.1.1 - Develop employee induction program (10477)
        • 7.3.1.1.2 - Maintain/Update employee induction program (10478)
      • 7.3.1.2 - Evaluate the effectiveness of the employee onboarding program (11243)
      • 7.3.1.3 - Execute onboarding program (17050)
    • 7.3.2 - Manage employee performance (10470)
      • 7.3.2.1 - Define employee performance objectives (10479)
      • 7.3.2.2 - Review employee performance (21434)
      • 7.3.2.3 - Manage employee performance (21435)
      • 7.3.2.4 - Evaluate and review performance program (10481)
    • 7.3.3 - Manage employee career development (10472)
      • 7.3.3.1 - Define employee development guidelines (10487)
      • 7.3.3.2 - Develop employee career plans and career paths (10488)
      • 7.3.3.3 - Manage employee skill and competency development (17051)
    • 7.3.4 - Develop and train employees (10473)
      • 7.3.4.1 - Align employee with organization development needs (10490)
      • 7.3.4.2 - Define employee competencies and skills (16940)
      • 7.3.4.3 - Align learning programs with competencies and skills (10491)
      • 7.3.4.4 - Establish training needs by analysis of required and available skills (10492)
      • 7.3.4.5 - Develop, conduct, and manage employee and/or management training programs (10493)
      • 7.3.4.6 - Manage examinations and certifications (20125)
        • 7.3.4.6.1 - Liaise with external certification authorities (20126)
        • 7.3.4.6.2 - Administer certification tests (20127)
        • 7.3.4.6.3 - Appraise experience qualifications (20128)
        • 7.3.4.6.4 - Administer certificate issue and maintenance (20129)
      • 7.3.4.7 - Monitor and evaluate learning programs (21436)
  • 7.4 - Manage employee relations (17052)
    • 7.4.1 - Manage labor relations (10483)
    • 7.4.2 - Manage collective bargaining process (10484)
    • 7.4.3 - Manage labor management partnerships (10485)
    • 7.4.4 - Manage employee grievances (10531)
    • 7.4.5 - Monitor legal and regulatory environment (21437)
  • 7.5 - Reward and retain employees (10412)
    • 7.5.1 - Develop and manage reward, recognition, and motivation programs (21438) - Developing a salary/compensation structure and plan; developing a benefits and reward plan; develop commission plan; performing competitive analyses of benefits and rewards; identifying compensation requirements based on compensation, benefits, and HR policies; administering compensation, commission, and rewards to employees; and rewarding and motivating employees.
      • 7.5.1.1 - Develop salary/compensation structure and plan (10498)
      • 7.5.1.2 - Develop benefits and rewards plan (10499)
      • 7.5.1.3 - Perform competitive analysis of benefits and rewards (10500)
      • 7.5.1.4 - Identify compensation requirements based on financial, benefits, and HR policies (10501)
      • 7.5.1.5 - Administer compensation and rewards to employees (10502)
      • 7.5.1.6 - Reward and motivate employees (10503)
      • 7.5.1.7 - Review retention and motivation indicators (10510)
      • 7.5.1.8 - Review compensation plan (10511)
    • 7.5.2 - Manage and administer benefits (10495)
      • 7.5.2.1 - Deliver employee benefits program (10504)
      • 7.5.2.2 - Administer benefit enrollment (10505)
      • 7.5.2.3 - Process claims (10506)
      • 7.5.2.4 - Perform benefit reconciliation (10507)
    • 7.5.3 - Manage employee assistance and retention (21439)
      • 7.5.3.1 - Deliver programs to support work/life balance for employees (10508)
        • 7.5.3.1.1 - Manage flexible working (21440)
      • 7.5.3.2 - Develop family support systems (10509)
    • 7.5.4 - Administer payroll (10497)
  • 7.6 - Redeploy and retire employees (10413)
    • 7.6.1 - Manage promotion and demotion process (10512)
    • 7.6.2 - Manage separation (10513)
    • 7.6.3 - Manage retirement (10514)
    • 7.6.4 - Manage leave of absence (10515)
    • 7.6.5 - Develop and implement employee outplacement (10516)
    • 7.6.6 - Manage workforce scheduling (20132)
      • 7.6.6.1 - Receive required resources/skills and capabilities (20133)
      • 7.6.6.2 - Manage resource deployment (10517)
    • 7.6.7 - Relocate employees and manage assignments (17055)
      • 7.6.7.1 - Manage expatriates (10520)
  • 7.7 - Manage employee information and analytics (17056)
    • 7.7.1 - Manage reporting processes (10522)
    • 7.7.2 - Manage employee inquiry process (10523)
    • 7.7.3 - Manage and maintain employee data (10524)
    • 7.7.4 - Manage human resource information systems HRIS (10525)
    • 7.7.5 - Develop and manage employee measures (10526)
    • 7.7.6 - Develop and manage time and attendance systems (10527)
    • 7.7.7 - Develop workforce analytics (21441)
      • 7.7.7.1 - Determine stakeholder requirements (21442)
      • 7.7.7.2 - Identify research questions (21443)
      • 7.7.7.3 - Select workforce analysis methodology (21444)
      • 7.7.7.4 - Identify workforce data sources (21445)
      • 7.7.7.5 - Gather workforce data (21446)
    • 7.7.8 - Implement workforce analytics (21447)
      • 7.7.8.1 - Transform workforce analysis data (21448)
      • 7.7.8.2 - Develop insights into workforce analytics outcomes (21449)
      • 7.7.8.3 - Communicate workforce analysis outcomes (21450)
    • 7.7.9 - Manage/Collect employee suggestions and perform employee research (10530)
  • 7.8 - Manage employee communication (21451)
    • 7.8.1 - Develop employee communication plan (10529)
    • 7.8.2 - Conduct employee engagement surveys (16944)
    • 7.8.3 - Deliver employee communications (10532)