Human resource outsourcing is considered an important factor in today rsquo s business world. It is constantly growing, especially in the global world where companies outsource not just within their country but across borders. This research concentrates on human resource outsourcing in the retail sector, including both small and medium size firms in the united kingdom. The ultimate aim of this research is outlined below: to find out why companies outsource their human resource ndash their first and foremost reasons. To find answers to these questions, five retail managers were interviewed: three respondents interviewed were conducted face to face and two were phoned interviewed. Again, fifty questionnaires were sent out to recruitment agencies who are the suppliers of the human resource, to confirm if they share the same opinion with retail managers who are their clients.

The results revealed that companies do not outsource all of their human resource functions. Recruitment is the key function outsourced for the simple reason of convenience and time saving. However, benefits are enormous including cost effectiveness, achieving higher core competency levels, greater flexibility and accessibility to expertise, reducing workload of staff etc. Results also depict two categories of outsourced staff, which are temporary staff and permanent staff with temporary staff being the majority. Companies who have managed their challenges well have been successful others on the other hand have redrawn from the process. The topic was chosen because is an issue being discussed currently all over the globe and the retail sector is proving to be a sector that employs a greater percentage of the workforce.

Chapter one gives a definition of outsourcing and discusses what outsourcing is all about. It gives relevant examples of those companies practicing human resource outsourcing and the results of their practice. The literature review establishes concise framework and reveals various reasons why companies tend to outsource and its subsequent benefits. It also raises the issues of concern and the control outsourcers have over their suppliers. It discusses people rsquo s opinion about the human resource outsourcing giving the pros and cons of the issue.

Part two of chapter two gives the factors that drives the process chapter three is basically about the retail sector and how it operates in the united kingdom analysing the importance of the human resource in retailing. Finally findings are reported and conclusion with limitations given in the last chapter. Outsourcing has been defined by gupta and gupta 1992 as lsquo the concept of hiring outside professional services to meet the in house needs of an organisation or agency rsquo another explanation is a managerial approach delegating non core functions of the organisation to other specialist and efficient services providers.

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In recent times, many companies are considering outsourcing their human resource because it is becoming a viable option. In the united kingdom united kingdom , the situation has been drastic, especially in the retail sector. Human resource indeed is one of the major factors of production and cannot be ignored in anyway for a business success. Human resource is constantly growing and keeping abreast with the dynamic business world, which relies heavily on the technology advancement and specialist skills.

The term lsquo human resource rsquo was once seen in companies operations as a department that issued policies, heard grievances and problems of it staff. As time went on, it then included various aspects of training that benefits administration and staffing. The focus however is gradually changing again, now as a strategic consultant to the main business, trying to match personnel and their skills with the corporate goals of the company with the view of achieving competitive advantage. Human resource outsourcing is becoming popular due to the perceived numerous benefits with emphasis on cost effectiveness and adding value to the organisation. In the united kingdom, the growth of human resource outsourcing stemmed from increased demand in the public sector but now the private sector is also expressing more interest. Winkleman et al, 1995 explained: outsourcing is actually not a new concept because organisations have always hired outside providers services in assisting their operations, especially information and communication technology ict.