Upside Surprise of MPHRO Contract Activity

Since the beginning of the second quarter, multi-process HR outsourcing (MPHRO) activity has heated up.  Over the last year, announced MPHRO deals have been far and few in between.  That’s not to say that MPHRO contracts haven’t been happening behind the scenes, but providers weren’t publicly disclosing this activity like they have been in the past several months.  Let’s take a closer look at some of these recent deals.

ADP has made three MPHRO announcements, the most by any single provider.  All three deals were for mid-market organizations with 2,000 or less employees. Two of the contracts were for organizations in the healthcare sector: Leon Medical Center and University of Miami Hospital. Its other deal was with a local government in Colorado (Laimer County).  Another provider capturing a mid-market win was Netherlands-based Raet with Alliade, another company in the healthcare industry.

Turning now to large market MPHRO deals, Logica was awarded a nine year MPHRO contract by Ahold for 100,000 employees in the Netherlands, Slovakia, and the Czech Republic.  This is a significant win for Logica whose MPHRO client portfolio consisted of U.K. and Netherlands-based organizations. Through this contract, Logica will have a history of serving MNCs.

Another large market MPHRO announcement came from Genpact who recently expanded its relationship with Nissan.  Genpact began providing HRO services to Nissan in 2003 for administrative activities.  Now, Genpact will provide Nissan and its affiliates the full spectrum of HRO services within payroll, benefits, recruitment, and learning.  In addition, Genpact has acquired Nissan’s HR shared service center in Yokohama, Japan and has renamed it Genpact Japan Service Co., Ltd.  The center will serve Nissan, its affiliates, and other Genpact clients, including one that has already transitioned over.

NorthgateArinso (NGA) was also in on some of the action.  It renewed its contract with Fifth Third Bank, a legacy Convergys client, for another seven years and will be implementing its euHReka platform.  This renewal is important in demonstrating that NGA can provide a high level of satisfaction that Convergys clients were accustomed to prior to the acquisition.

Other MPHRO activity came from Aon Hewitt with a financial services company and Capgemini with Brazilian conglomerate, Algar, which is part of a larger multi-tower BPO deal.

NelsonHall’s 2011 MPHRO report specified the following verticals as those that will emerge strongly: manufacturing, healthcare, government, and retail.  All of the recently announced activity fell into one of these verticals.  In terms of geography, the above contracts spanned all regions of the world including North America, South America, Europe, and Asia Pacific.  But, to learn NelsonHall’s estimated CAAGR for these regions, you will have to review the full MPHRO report available for purchase at www.nelson-hall.com.

Amy Gurchensky, Research Analyst, HRO, NelsonHall

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Explore posts in the same categories: benefits administration, healthcare, hr outsourcing, hr outsourcing research, HRO contracts, HRO providers, learning outsourcing, mid-market HRO, multi-process hro, payroll outsourcing, recruitment process outsourcing

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