Executive Summary

North American-headquartered buyers traditionally dominated the global multi-process Human Resources Outsourcing (HRO) market, with over 70 percent of the deals through the end of 2007 signed in this region. In comparison, the European HRO market saw limited activity from a deal origination perspective. While European organizations have traditionally been more conservative than their North American counterparts in embracing outsourcing, various legislative and demographic considerations that impact HRO also contributed towards a lower adoption level in the European region.

However, in the last two years, Europe saw increased activity from a deal-origination perspective. This led to Europe’s share in the global HRO market increasing from 20 percent to 30 percent, in terms of number of deals, in the post-2005 period. Some of the factors that are influencing the growth of HRO in Europe are:

• Suppliers are addressing the unique challenges present in Europe, making HRO a viable strategy for buyers to drive efficiency and generate cost savings
• Increased adoption of HRO by the public sector in the UK
• Increased acceptance of global sourcing
• Entrance of new suppliers

Also, there are some key differences in the way the European HRO market is evolving compared to North America in terms of its path to HRO adoption, including technology considerations, HR process inclusion, and usage of global sourcing.

This whitepaper discusses:

• Key geographic market segments in Europe based on their inherent characteristics that impact HRO adoption
• Unique challenges in Europe and the steps adopted by buyers and suppliers to address them
• Differences between the approaches taken by European and North American buyers
• Changing dynamics within the supplier landscape in Europe