1. The document discusses the benefits and risks of outsourcing human resources functions. It notes that while outsourcing is promoted as a way to reduce costs, improve services, and access expertise, there are also indications that these benefits are not always realized. Additionally, outsourcing poses risks like negatively impacting employee morale and transferring insider knowledge. Careful management of outsourcing arrangements is important.
2. British Petroleum outsourced its HR functions to a third party, Exult, to reduce costs, improve support for employees, and allow HR to focus on strategic work rather than administrative tasks. The outsourcing achieved a 40% reduction in HR staff and $15 million in annual cost savings.