Traits of the new HRO Buyer

While we see frequent mention of the “new normal” in analyst writings and the press, we are not sure yet what that really is or how it translates into HRO buyer behavior. I see likely parallels with a recent Chicago Tribune news article on the Five Traits of the American Consumer. Keying off these traits, let’s speculate on how to tie changes in consumer behaviors to HRO buying triggers.  

Optimism – fifty-five percent of consumers are classified as spend-shifters that are optimistic and resilient. The new consumer does not want to go overboard with radical frugality; instead, it simply seeks value for its money.

• Overall cost is still a major concern, but the conversation can move more to total business value and growth over survival to play into a return of moderated optimism.

Brand consciousness – brand is equated more with value than with trendiness, and a trusted brand is worth a bit more.

• Brand clarity and differentiation have value – make sure messaging is clear, backed up by data and client references.
• In the midst of a round vendor M&As, financial stability and commitment to the HRO market is also important.

Authenticity-seekers – there is a desire for a more ethical and sustainable style of consumption and life.

• Services delivered and commitments achieved – not marketing hype – are key.
• Sustainability initiatives, and responsible shoring – vendor business practices matter.
• Partnerships and the user experience fit in here as well.

Purpose-driven – there is interest in simplification and decluttering, and consumerism is tempered with thoughtful awareness of social and personal consequences.

• Service enhancements should not look like optional bells and whistles. Instead, emphasize simplification and ease of use.
• This trait can also support the current practicality of trading-off customization for process structure to manage costs.

Maturity – young adults are more likely to embrace responsibility and a more mature lifestyle with a greater focus on achieving goals.

• Link the benefits of HRO to specific and realistic business impacts.
• Works well with adding more employee and manager self services.

All service providers can debrief new inquiries and sales efforts to identify what is important to the new HRO buyer. Providers must also look for the alignment points with long-term business goals to refine their business value proposition and define enabling business strategies.

An example is IBM’s recent announcement to rename its Managed Business Process Services business unit as “IBM Global Process Services” in order to focus on the next generation of BPO services. IBM has reviewed its own intentions, strengths and differentiation, and reflected that clarity in its messaging.  In HRO, IBM is using its new identity to align investments and inititatives, with a revision in the processes for transitioning clients that reduces timelines and costs being one of the first projects that brings together new and existing best practices, and changes internal operations as well as client services.

Yet new names and brand messaging mean little if not translated into action and used to drive investments and initiatives. How are you identifying and responding to changes in HRO buying behaviors?

Linda Merritt, Research Director, HRO, NelsonHall