[HROA Essentials] The human aspect of outsourcing - A demotivated or energized workforce?

Outsourcing is expected to continue to grow rapidly over the next few years, with the global BPO market forecast to reach £96.92bn by 2009. Roles which were previously considered ‘safe' are now under consideration for outsourcing, as third party suppliers move into new areas such as product engineering, and legal services. It is not surprising that outsourcing continues to be a hot topic on the staff rumor mill, leading to staff concerns about job security and long term prospects. Outsourcing can be a major source of disruption, demotivation and reduced productivity - but does it always need to be like that?

We hear all too often about companies who delay as long as possible telling the workforce about an outsourcing deal to avoid disruption. Companies who do not credit their workforce with the basic intelligence to work out that an increase in management meetings and external visitors mean that change is afoot. These same companies are then astonished at the lack of employee loyalty later on. Not communicating (even if there is no news) can make employees feel ‘lied to', so is it any wonder they start leaving at 5pm prompt, taking long breaks and no longer picking up the work of absent colleagues? Other companies tell their employees ‘outsourcing is being looked at' and believe this will ensure staff cooperation with the host of additional questions, data gathering and workload that comes with investigating an outsourcing deal. But a single upfront piece of information does not guarantee workforce cooperation. How many outsourcing deals have been potentially jeopardized by an uncollaborative workforce?

So outsourcing has a long track record of communication failure from these different approaches. However it is possible to keep a workforce on track through an outsourcing deal, and case studies show that there are 3 simple messages to help employees avoid the distraction of worrying ‘My job is being outsourced, what happens to my career?':

Message 1 - Outsourcing does not equal unemployment

Many outsourcing deals do not result in redundancy, simply a transfer in the same role to a new employer. In such cases, employees' rights are protected by the Acquired Rights Directive 1977, which ensures that workers are entitled to continue working for the new employer on the same terms and conditions, retaining their existing employment rights and obligations. But safeguarded terms and conditions do not make ‘being outsourced' plain sailing. The day-to-day the work environment will change, as will the company culture, personal development structures and reward mechanisms. Dissatisfaction with this change inevitably causes an increase in ‘churn', with a number of employees leaving voluntarily in the first year after an outsourcing deal. Helping employees to adapt to these differences, through open dialogue and strong change management is critical to maintaining stability in the organization. Computacenter, who deliver IT Services to BAA were able to ensure almost 100% retention of staff in the first year after transition, thanks to strong employee transition and communication program.

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By Rachel Anderson
Senior Consultant - Alsbridge Europe