Strategic decisions regarding the vertical integration of human resource organizations: evidence for an integrated HR Model for the financial services and non-financial services industry in Germany, Austria and Switzerland
Strategic decisions regarding the vertical integration of human resource organizations: evidence for an integrated HR Model for the financial services and non-financial services industry in Germany, Austria and Switzerland
Wahrenburg M., Hackethal A., Friedrich L. and Gellrich T. The International Journal of Human Resource Management, October 2006, Vol. 17 No. 10, Start page: 1726, No. of pages: 46
Purpose – to examine those factors determining the level of vertical integration of human resources (HR) in organizations. Design/methodology/approach – draws attention to how financial service organizations have significantly increased their outsourcing activities,including HR. Presents a study that seeks to explain management decisions on whether, or not, to outsource HR activities, by analysing HR outsourcing activities across various industries. Describes the collection of survey data from financial services companies (13) and non-financial services companies (29)in Germany, Austria and Switzerland. Presents a relevant literature review on human resource outsourcing; adopts three theories to provide a valid framework;outlines a number of hypotheses that were then tested on the data which analysed structures, processes and sourcing activities of HR organizations. Findings– puts forward that while out sourcing is a growing trend, vertical integration of HR organizations is still quite high, indicating that HR organizations prefer “make” to “buy”. Reports how companies in the financial services sector display lower mean values for vertical integration compared to the companies from the non-financial services sector. Research limitations/implications – notes a number of study limitations. Originality/value – employs various theoretical frameworks to investigate further the determinants of HR organization outsourcing.
Keywords: Financial services, Human resource management,Organizational structure, Outsourcing
