This website uses cookies to ensure you have the best experience. Learn more

Ibm Outsourcing: How Will Ibm Benefit From Outsourcing Hr Functions To Fidelity?

951 words - 4 pages

In early July 2002, IBM and Fidelity Investments announced an outsourcing agreement that will have IBM outsourcing the administration of its pension, employee health plans, and other human resource services to Fidelity. Also, the two companies will enter a partnership on selling human resources payroll and benefits outsourcing services to other clients. Of the numerous benefits that IBM will enjoy from this deal with Fidelity to handle a large portion of their human resources, there are three that seem to be significant. They are the joint venture between IBM and Fidelity, the reduction in the number of employees while saving money and improving employee services, and the more focussed vision IBM will have on their core business.IBM and Fidelity both believe that the market for the outsourcing of human resource functions will be growing fast in the future. If this is true, the results could be very lucrative. Estimates show that the outsourcing market could be worth $43 billion by 2005 and could continue to grow at more than 20 percent per year there after. The other reason for this agreement is to demonstrate their outsourcing experience to prospective clients."Before the Fidelity announcement, we had an ongoing national practice for HR," points out Towney Kennard, vice president of alliances for IBM Global Services. "We now have an alliance with Fidelity in the marketplace. We can use the IBM experience as a major proof point that these are the benefits we delivered to our employees and company. We can talk to our customers from an experiential point of view. We believe that a number of large enterprise customers will be very interested in what IBM did and why we did it. If we believe they should do what IBM did, we will engage Fidelity after an initial consulting period. If the customer should decide to go with Fidelity, we will then come in and help with the transition period. We believe it's a great opportunity for our two companies."ƒ¡ This provides motivation to both IBM and Fidelity to make the operation run efficiently while saving money.They began this transition by transferring 450 human resources employees from IBM to Fidelity. These employees will handle the majority of the HR functions for 260,000 IBM employees and retirees. The same 450 employees that worked in the IBM Employee Service Center in Raleigh, N.C., became Fidelity employees and continue to work out of the same building as they did when they were IBM employees. This allowed for a seamless transition for both management and employees, while allowing employees to remain in North Carolina. While the Employee Service Center continued to provide the same human resource transaction and administrative support to current employees and retirees in the United States. This agreement did not do away with all human resource functions within IBM, just a significant portion. IBM will still have large base of employees that will accomplish daily human resource functions, such...

Find Another Essay On IBM Outsourcing: How will IBM benefit from outsourcing HR functions to Fidelity?

Outsourcing to India: Is the United States benefiting from it?

2382 words - 10 pages believe that this is actually the opposite of what the protestors want. Allowing less foreign programmers into the United States will lead to more outsourcing, but allowing more would actually create competition and could benefit employees here in the United States. In contrast, from an Indian perspective, the disadvantages are very minimal. The main protestor is that of the large Indian corporations, because they are losing talented programmers

introduction to outsourcing Essay

2479 words - 10 pages payment accounts, now the bank is reentering all the missing data manually to bring the system back to normal. The CEO of RBS stated that “there is no evidence which proves outsourcing was the reason behind this glitch as the main IT center is situated in Edinburgh which monitors all the overseas works”. He also stated that “the technology always comes with minor faults which become catastrophic some times and we should learn from our mistakes

Application of Porter 5 Forces to IBM

717 words - 3 pages ,The attractiveness of internet services making it more affordable to the masses.Rivalry among CompetitorsTelecommunication industry in Malaysia is oligopoly structure nowadays. Maxis have two main competitors, they are Celcom, Digi. Maxis lead this telecommunication industry. They are largely compete on differentiate their product and services on how to improve their features and implementing innovation. Moreover, company in this industry will

Apply Porter 5 forces to IBM

9139 words - 37 pages economies of scale due to experience curve effect. In addition, Consumers' preference over established brands, long-term relationship and broad product portfolio make IBM the preferred brand.2.Threat of SubstitutesPropensity to substitute is low for buyers. Threat varies from low to medium with high switching cost and product differentiation such as technology, performance, functionality etc.3. Bargaining power of buyersBargaining power is high during

Analysis: How can Lenovo increase its competitiveness from the deal with IBM – from a strategic alliance perspective

2036 words - 8 pages corporate business, but it needs to penetrate the consumer markets as well. Acquiring IBM helps Lenovo to gain the knowledge of operating in international markets, especially American markets. However, it must not just follow the original IBM routes (Canton d., 2009).Concerning about how the acquisition can benefit Lenovo, firstly, as a world-leading company like IBM, it has specialized and advanced skills in sales and marketing functions, for

Outsourcing, The Key to Globalization

1406 words - 6 pages they were acquiring. After a few years many of them were laid off to either off shoring or outsourcing the field. How fair is this to those people. Actually not only to them but that's a problem for years to come. According to McKinsey Global Institute outsourcing combined with off shoring will be increasing which means that it will keep increasing and more and more people will not be able to find jobs or in will be a lot harder to

Outsourcing Development Work to India

2410 words - 10 pages value of US exports of legal work, computer programming, telecommunications, banking, engineering, management consulting and other private services jumped to $131.01 billion in 2003, up $8.42 billion from the previous year" So why is everyone jumping on the bandwagon? Some of the driving forces will be addressed below. There are many reasons that companies provide for the determining factor for outsourcing. Some of these reasons include

Outsourcing Jobs to Foreign Countries

1210 words - 5 pages foreign investment. If outsourcing is the future, it needs to be a sound decision, and not at this extreme cost to our own communities, our own environment. Outsourcing has lowered the state of the economy.Outsourcing is usually explained in a selfless light. Many explanations that are given speak about how the company will prosper and so to shall the workers. From an online article, Unemployment, Structural Change and Globalization, M. Pianta

Outsourcing Jobs to Foreign Countries

1237 words - 5 pages trade and the American worker will benefit eventually.Whatever solutions or interventions to this situation are finally implemented, the American workers must face the truth that their job is at risk. If current outsourcing trends continue, the American way of life, the American dream will be harder and harder to achieve. Perhaps, the time has come for Americans as a people to look at the way we live and opt for a simpler way of

Advantages and Disadvantages of Outsourcing from Competitors

1004 words - 5 pages (Besanko et al 2009). This essay will firstly discuss the advantages and disadvantages of outsourcing from competitors. Then two solutions will be applied according to the risks of outsourcing. Finally. It will make a conclusion. Main body The advantages of outsourcing: The primary to be considered is efficiency so that firms should concentrate on what they do best and leave others to markets. There are some specific reasons to support firms

The dinosaur that refuses to die - IBM Servers

729 words - 3 pages individual business requirements. It is also IBM's cheapest mainframe - starting at $ 200,000. The z890 which will become available worldwide including in India on May 28, can run Linux and mainframe operating systems at the same time - indeed IBM is the first company that has come out strongly in support of Open Source environments like Linux as an option that customers should have.The other change is the near separation of storage functions from

Similar Essays

What Three Important Benefits Will Ibm Receive From Outsourcing Their Hr Functions To Fidelity And How Will They Benefit Ibm?

908 words - 4 pages program for 800,000 people, and an increase in new customers by offering its outsourcing HR skills to other businesses. Of these the biggest benefit is that IBM Global Services and Fidelity announced that they are forming a relationship to market HR payroll and benefits outsourcing services. Areas of joint cooperation will include providing clients with consulting services around evaluating and implementing HR and benefits outsourcing solutions.So

Developing Hr Outsourcing Consultants Essay

1658 words - 7 pages outsourcing firms are generalists, offering a wide variety of services, while others are specialists, focusing on specific areas such as payroll or recruiting. Depending on the size of your business and how much control you want to maintain over HR functions, you can either outsource all your HR tasks or contract for services a la carte (” Internal HR Consultants advise management as to whether or not HR outsourcing is

Outsourcing It Functions Essay

1192 words - 5 pages final decision before the management of a company looking to outsource is whether or not outsourcing will provide a strategic advantage over the competition. Factors for Outsourcing One of the main reasons companies look to outsource is to save money on functions that are not deemed core activities ("A key strategic question: to outsource or not?," 2007). By turning over parts of their operations, that they feel can be better handled by an

How Consumerism Affects Outsourcing Essay

1060 words - 5 pages products are made. Therefore, consumers are spending extra money and are causing outsourcing to thrive. The lack of knowledge Americans have on the subject of consumers affecting outsourcing is leading our country to economic stress but if we begin to recognize the issue, the jobs we could potentially save may be our own. First, we will look at an example of how consumers inadvertently continue to assist companies with outsourcing. The problem