• 4,000 firms
  • Independent
  • Trusted
Save up to 70% on staff

Home » Glossary » Shared Services

Shared Services

Definition

Shared Services

Shared services is an in-house model where one team runs repeatable work, such as finance, HR, IT and procurement, for every business unit from a single center. The parent firm keeps control and payroll, and each unit pays for what it uses.

The idea took hold in the early 1990s, when General Electric and Ford pulled scattered finance teams into single sites to standardize ledgers and cut headcount. Three decades on, the playbook still works — what changed is the scope.

Today a center can absorb almost any rules-based function a corporation runs, from invoice processing to master-data management to first-line IT support. Most large groups also run a hybrid: a captive hub offshore, with selective vendor work layered on top.

Outsource Accelerator has tracked this shift since 2017, and one pattern keeps repeating. Companies that treat shared services as a pure cost play stall around year two. The ones that treat it as a process-redesign program keep compounding savings.

Key takeaways

  • Shared services centralizes back-office work inside the company; outsourcing hands the same work to an outside vendor.
  • Mature centers report 25–40% lower process costs once consolidation and standardization finish, per Deloitte’s 2023 Global Shared Services and Outsourcing Survey.
  • Most large enterprises run hybrid setups: captive centers in Manila, Krakow or Bengaluru, plus targeted outsourcing on top.
  • Governance is the make-or-break variable, not location — a center without a business-unit steering committee drifts into order-taking.
  • Automation sits inside the model rather than replacing it, so staff shift from processing work to exception handling and analytics.

How it works

A shared services center (SSC) pulls similar tasks from every business unit into one team that works to a service-level agreement. Work gets standardized, automated where it can be, and charged back per transaction or by subscription.

Most builds move through four stages, and skipping one is the usual reason a program stalls.

StageFocusTypical duration
1. ConsolidationPull scattered teams into one site, freeze processes6–12 months
2. StandardizationSingle workflows, single tools, single chart of accounts12–18 months
3. OptimizationLean, robotic process automation, analytics layered on top18–36 months
4. Value-addCenter moves from transaction processing to advisory work36 months+

Governance sits with a steering committee drawn from the parent business. The center itself runs on hard measures: cost per invoice, days-to-close, first-contact resolution and customer satisfaction scores.

Headcount economics hold up too. Per the Bureau of Labor Statistics, business and financial operations roles, which make up the bulk of SSC staffing, are projected to grow 7% through 2033.

Location strategy matters as much as design. A captive center in the Philippines, India, Poland or Costa Rica delivers labor arbitrage of 50–70% against US or UK rates, while keeping staff on the parent’s payroll.

Attrition is the quiet risk. Offshore finance and helpdesk roles turn over faster than their onshore equivalents, so mature centers budget for a training bench, clear career ladders and documented processes instead of assuming the first cohort stays put.

Funding models decide behavior. A flat corporate allocation invites business units to over-consume, while per-transaction chargeback makes them curious about their own volumes — and that curiosity drives the second wave of savings.

Examples

Real programs look nothing like the textbook diagram. The four below span consumer goods, energy and an entire national sector, and each one shows a different reason companies keep this work in-house.

  • Procter & Gamble Global Business Services: runs finance, HR, IT and facilities for the whole group from hubs in Manila, San José and Newcastle. The center serves roughly 100,000 employees, and Gartner has repeatedly cited it as a benchmark global business services program.
  • Shell Business Operations: five sites, in Manila, Krakow, Chennai, Bengaluru and Kuala Lumpur, cover finance, HR, contracting and customer operations for Shell’s upstream and downstream units. The Manila site alone employed more than 5,000 people as of 2024.
  • Unilever Enterprise & Technology Solutions: consolidated 26 separate finance back offices into four global hubs between 2018 and 2023, and reported days-to-close falling from eight days to three across the group.
  • The Philippine IT-BPM sector: the IT and Business Process Association of the Philippines reported USD 38 billion in revenue and 1.82 million direct jobs in 2024, with captive centers taking a growing share of new hires.

Notice what these programs share. Each standardized before it automated — and each reports to a steering committee with real budget authority, rather than to a single function chasing its own numbers.

Each also sequenced the work. Transactional volume moved first, judgment work followed only once the base was stable, and analytics arrived last. Reverse that order and the center inherits chaos it cannot price.

Related terms

Shared services sits inside a wider family of operating models, and the differences between them are practical rather than academic. Read these next to place the model accurately against its closest neighbours.

FAQ

The five questions below cover what buyers ask most often about shared services: how it differs from outsourcing, which functions move first, what the model saves, where the centers sit, and whether automation has changed the answer.

How is shared services different from outsourcing?

Shared services keeps the team inside the parent company, on its payroll and inside its security perimeter. Outsourcing hands the same work to an external vendor under a contract. Many large groups run both at once.

What functions are usually first into a shared services center?

Finance and accounting almost always go first: accounts payable, accounts receivable, general ledger and payroll. HR transactional work and the IT helpdesk form the typical second wave.

How much does a shared services model actually save?

Mature centers report 25–40% lower process costs once standardization and automation are in place. Offshore labor arbitrage adds another 50–70% on the affected roles.

Where are most shared services centers based?

The Philippines, India, Poland, Malaysia, Costa Rica and Romania dominate the list. Manila is the largest single hub for English-language finance and customer operations work.

Is shared services still relevant with automation and AI?

Yes, because automation moves the work rather than the model, so your people handle exceptions and analytics while software clears the volume.

Ready to benchmark your own center or find a partner to run alongside it? Compare vetted providers in the Outsource Accelerator directory.

Outsourcing FAQ

What is What is business process outsourcing??

What is business process outsourcing?

Business process outsourcing (BPO) is hiring a third-party provider to run a defined business function like customer support, payroll, or IT helpdesk. The provider takes ownership of the people, process, and technology, and bills per seat, transaction, or fixed fee.

BPO is a subset of outsourcing that focuses on repeatable, high-volume work. When those functions move to a lower-cost country, the setup is called offshoring.

Common categories include customer support, finance and accounting, HR, IT helpdesk, and other back-office work — plus higher-value knowledge processes like analytics or research.

Key takeaways BPO shifts a defined function to an external provider under a written contract. Pricing models fall into per-FTE, per-transaction, outcome-based, or hybrid buckets. The Philippines and India lead global BPO delivery through 2025. Cost drives many deals, but access to talent and 24/7 coverage matter just as much. A service level agreement sets the quality bar and remedies for the relationship. How it works

BPO works by transferring a defined process to a specialized vendor under a written contract. You keep strategic control; the provider owns staffing, tools, and daily execution.

Pricing usually follows one of four models — per-seat, per-transaction, outcome-based, or a hybrid mix.

Companies choose BPO for three reasons: lower cost, access to specialized talent, and the ability to convert fixed headcount into variable operating expense. Most enterprise buyers combine two or three of these goals in the same contract.

Most engagements start with discovery. The client documents the process, sets KPIs, and defines escalation paths. The provider then hires, trains, and shadows before going live — typically 6 to 12 weeks.

The pricing model shapes risk. Per-seat fees favor steady work; outcome-based fees push accountability onto the provider. Most contracts also include a service level agreement that ties bonuses or penalties to defined performance targets.

Model How you pay Best for Per FTE (seat) Fixed monthly rate per agent Steady-volume work like inbound support Per transaction Set fee per call, ticket, or invoice Variable-volume back-office tasks Outcome-based Tied to a KPI like CSAT or collections Mature processes with clean metrics Hybrid Base FTE rate plus variable bonus Long-term partnerships

Contracts usually run 2 to 5 years with annual price adjustments. Buyers should build off-boarding clauses upfront so the process can move back in-house or to another vendor if performance slips.

The upside is clear: cost reduction of 30-60%, faster staffing, and 24/7 coverage using follow-the-sun teams. The trade-off is management overhead, cultural distance, and dependency on a single provider for critical work.

Provider selection now weighs security posture and data residency more than a decade ago.

GDPR, HIPAA, and PCI-DSS obligations flow from the client to the provider. Contracts spell out audit rights, penalty clauses, and breach reporting windows.

Location choice matters. Providers in the Philippines and India deliver English-language support at 40-70% below onshore rates, while nearshoring to Mexico or Colombia buys time-zone alignment. Onshoring stays domestic but costs the most.

Examples

BPO delivery clusters into three archetypes — call center hubs, knowledge process shops, and nearshore bilingual centers. Global BPO revenue reached USD 347.95 billion in 2024 with a projected 10.05% CAGR through 2035, per Precedence Research.

Buyers often start in the Philippines. English fluency, Filipino traits and values, and Western-facing culture reduce onboarding friction. It remains the top outsourcing destination for voice work heading into 2025.

Philippines call centers. The Philippines IT-BPM sector booked around USD 40 billion in 2024 with about 1.9 million employees, targeting 2.5 million by 2028.

Concentrix, Teleperformance, and TDCX all run major Manila and Cebu call center campuses. See the Top 40 BPO companies in the Philippines and this guide to call centers for hire.

India knowledge process outsourcing. Knowledge process outsourcing firms in Bengaluru and Gurgaon handle equity research, legal review, and analytics for Wall Street. WNS, Genpact, and EXL all posted multi-billion-dollar revenues in 2024.

Latin America customer support. Colombia, Mexico, and Costa Rica attract US fintechs and SaaS platforms wanting Spanish-English bilingual agents. Rankings on Clutch show Bogotá firms among the fastest-growing between 2022 and 2024.

Global finance and IT support. Accenture, IBM, and Cognizant deliver ERP support, cloud operations, and finance-and-accounting from delivery hubs in Poland, Ireland, and India. Their contracts often span 5 to 10 years and blend BPO with technology services.

Enterprise BPO deals are becoming more outcome-linked. Rather than paying per seat, buyers in 2024 increasingly pay for defined KPIs like first-call resolution or completed orders, which pushes performance risk back to the provider.

Related terms Offshoring: the practice of moving business functions to distant, lower-cost countries. Nearshoring: outsourcing to a country in a similar time zone, often for language or cultural fit. Onshoring: keeping outsourced work inside the client's home country. Knowledge Process Outsourcing: outsourcing of higher-value analytical or specialist work such as research or legal review. Call Center: a facility built to handle inbound or outbound customer calls at scale. Back-Office: the non-customer-facing operations that support day-to-day business functions. Service Level Agreement: the contract clause that defines performance targets and remedies for a BPO deal. FAQ What is BPO in simple terms?

BPO is when a company hires another business to run a specific function like customer service or payroll. The client sets the outcomes; the provider handles the day-to-day work.

What is the difference between BPO and outsourcing?

Outsourcing is the umbrella term for contracting any external provider. BPO is the subset that covers full business functions like call centers, HR, or accounting, usually delivered offshore at scale.

Is BPO only about cost savings?

No. Cost is the entry point, but most mature buyers cite access to specialized talent, 24/7 coverage, and scalability as the bigger long-term wins. Cost-only deals tend to churn within 18 months.

Which countries dominate BPO?

The Philippines leads voice and English-language customer support. India dominates IT and knowledge process work. Mexico, Colombia, and Costa Rica anchor Latin America's nearshore market for US clients.

What functions do companies outsource most often?

Customer support, IT helpdesk, finance and accounting, HR administration, and content moderation lead the pack. Higher-value work like data analytics and legal review is growing fastest.

How do I choose a BPO provider?

Match the provider's specialization to your function, check industry references, and shortlist candidates using the Ultimate Guide to Outsourcing.

Explore vetted providers at Outsource Accelerator's BPO Directory

Offshore outsourcing definition

Offshore Outsourcing

Offshore outsourcing is the practice of contracting business functions to a third-party provider in a distant country to cut labour costs, tap specialised talent, or extend operating hours around the clock — a geographic gap that often spans continents and time zones.

Key takeaways Offshore outsourcing sends specific business functions abroad, most often to lower-cost hubs in Asia, Latin America, or Eastern Europe. Labour arbitrage still drives the model, but talent depth and 24-hour coverage now rival cost as the main draws. Common engagement shapes include project outsourcing, managed services, and staff leasing under buyer direction. The Philippines and India dominate the sector, together handling most global voice, back-office, and IT delivery. Risks include time-zone friction, data-security exposure, and cultural gaps, but clear governance keeps them manageable.

The term separates offshore work from nearshore (a neighbouring country) and onshore (the same country). Buyers pick offshore when the cost gap or skill pool outweighs the coordination tax of a distant time zone.

The model matured in the 1990s with India's IT-services boom and has since spread to voice support, finance and accounting, engineering, and creative work delivered from hubs across Asia, Latin America, and Eastern Europe.

Buyers today range from Fortune 500 banks to Series A start-ups. Small firms increasingly access offshore talent through seat-based staff leasing arrangements, while enterprises still favour managed services or captive delivery centres for scale and control.

How it works

Offshore outsourcing works through a contract that hands defined tasks — like customer support, accounting, or software development — to a vendor overseas. The buyer sets outcomes and service levels; the vendor recruits, houses, and manages the offshore workforce.

Buyers usually pick one of three engagement shapes, each trading control for scale.

Model What the buyer rents Best for Project outsourcing Fixed-scope deliverable One-off builds, migrations Managed services Team plus the process Long-running functions like payroll Staff leasing Named seats under buyer direction Embedded teams, gradual scale-up

Beyond cost, offshore contracts unlock three levers: 24-hour delivery through time-zone stacking, access to skill pools too thin at home, and rapid team scale-up without hiring onshore. Each lever justifies a different engagement shape.

Pricing follows the same split. Project work bills against a milestone; managed services carry a monthly fee tied to output; staff leasing charges a seat rate that mirrors offshore payroll plus vendor margin.

Governance sits on top of every model. Most buyers embed a small onshore programme team to run vendor management, quality assurance, and change control, keeping strategic decisions inside the parent company.

Data-security posture and privacy compliance ride the same team. Frameworks like ISO 27001 certification and GDPR alignment are now table stakes for most offshore providers serving Western buyers.

The offshore BPO sector employed roughly 1.8 million Filipinos in 2024, per the IBPAP industry roadmap, generating close to $38 billion in revenue and cementing the Philippines as the world's top voice-services hub.

India's IT and business-services exports topped $250 billion in the 2024 fiscal year according to industry group NASSCOM, with offshore delivery to United States, United Kingdom, and Australian buyers still driving most of the volume.

Examples

Offshore outsourcing shows up across finance, tech, and customer service. Named examples below illustrate how large buyers and their offshore partners split work between headquarters onshore and delivery centres in Manila, Bengaluru, and Warsaw.

JPMorgan Chase. The bank runs one of the largest captive centers in India, staffing more than 55,000 people across Mumbai, Bengaluru, and Hyderabad for technology, analytics, and back-office roles as of 2024.

Concentrix in the Philippines. The Fremont-based CX firm operates dozens of Manila and Cebu sites, delivering English-language voice support for Fortune 500 clients, a use case anchored by the country's high EF EPI 2024 English proficiency score.

American Express and Genpact. Amex offshored large parts of its finance-and-accounting back office to Genpact in India starting in the mid-2000s, and the arrangement now covers analytics, procurement, and risk operations across Gurgaon and Hyderabad.

Deloitte in Poland. The consulting firm runs delivery hubs in Warsaw and Wroclaw that serve Western European clients with tax, audit-support, and technology work, showing how offshore lines blur into nearshore for an EU buyer.

GE Aviation and HCL Technologies. GE Aviation offshored engineering-services work to HCL in Bengaluru starting in the late 1990s, and the partnership now covers aircraft component design, embedded software, and analytics for jet engines and avionics.

WNS and Aviva. UK insurer Aviva runs multi-year finance-and-accounting outsourcing with WNS from Pune and Chennai, covering claims processing, actuarial support, and policy servicing at scale below UK unit-cost levels.

Related terms Business process outsourcing (BPO): the umbrella category covering any function contracted to an external provider. Nearshoring: the same delivery model but to a neighbouring country instead of a distant one. Onshoring: contracting work to a provider inside the buyer's own country. Reshoring: bringing previously offshored work back to the home country. Captive center: a wholly-owned offshore delivery unit run by the buyer, not a third party. Staff leasing: a seat-based offshore model where the buyer directs the team day-to-day. Knowledge process outsourcing (KPO): higher-skill offshore work like research, legal review, or analytics. FAQ What countries dominate offshore outsourcing?

The Philippines leads voice and CX work; India dominates IT, engineering, and knowledge work. Eastern Europe (Poland, Romania) and Latin America (Colombia, Mexico) serve buyers who want tighter time-zone overlap. Emerging hubs include Vietnam and South Africa.

How does offshore outsourcing differ from nearshoring?

Offshore outsourcing spans continents; nearshoring stays within a few time zones. A US buyer contracting to Manila is offshoring, while a US buyer contracting to Mexico City is nearshoring. Costs are usually lower offshore, but nearshore reduces coordination friction.

Is offshore outsourcing still cheaper than onshore work?

Yes — the labour arbitrage typically runs 40-70% on fully-loaded cost for equivalent roles. The gap narrows for senior talent and specialised skills, and rising offshore wages have trimmed it in mature hubs like Bengaluru and Manila.

What functions offshore best?

Rules-based and language-heavy work moves offshore well: customer support, accounting, payroll, IT helpdesk, data entry, and software development.

Judgment-heavy or client-facing roles are harder to shift. Hybrid models keep sensitive judgment onshore while running execution offshore.

What are the main risks?

Data security, time-zone friction, cultural misalignment, and vendor lock-in top the list. Buyers mitigate them with service-level agreements, hybrid governance, and staged transitions rather than lift-and-shift moves. GDPR still applies across borders.

Where can buyers find qualified offshore providers?

Global directories like OA's BPO companies listing rank verified vendors by function, size, and market. The World Bank also publishes country-level digital-economy data useful for shortlist decisions.

Explore more OA terms and guidance at Outsource Accelerator

What is Back Office?

Back Office

The back office is the internal side of a business (finance, HR, IT, data, admin, compliance) that keeps operations running without touching the customer. It's usually where 40% to 60% of the workforce sits and where the biggest outsourcing gains hide.

Front office wins deals. Back office keeps the lights on. Every invoice paid, payslip filed, ticket resolved internally, and system patched sits in the back office.

Since roughly 2005, back office has been the single most-outsourced function in global business. Genpact, spun out of GE that year, built a USD 4 billion business almost entirely on back-office contracts. Most of the Fortune 500 followed.

Precedence Research put the global BPO market at USD 347.95 billion in 2025, growing at 10.05% CAGR through 2035. Back-office functions account for roughly 60% of that spend.

Key takeaways Back office = finance, HR, IT, admin, data, and compliance — everything that isn't sales, marketing, or direct customer service. 40% to 60% of a typical business's headcount sits in back-office roles. Global BPO spend hit USD 347.95 billion in 2025, with roughly 60% flowing to back-office work. Common outsourced back-office roles run USD 6 to USD 20 per hour in the Philippines vs USD 25 to USD 60 onshore. The Philippines and India remain the two largest destinations, with India dominating finance work and Manila dominating HR and admin. How it works

The back office runs on process discipline. Each function has a standard operating procedure, a system of record, and an SLA. Work flows through queues, gets scored on turnaround time and error rate, and rolls up to a monthly ops review.

Typical back-office functions and their measurable outputs:

Function Core task Standard metric Finance & accounting Invoicing, reconciliation, month-end close Days to close, error rate Payroll Wage runs, tax filings, benefits admin Payslip accuracy, on-time percentage HR admin Onboarding, contracts, leave tracking Time to hire, ticket resolution time IT support Service desk, system patching, user access First-call resolution, MTTR Data processing Entry, cleansing, migration Records per hour, accuracy rate Compliance Audit trails, KYC, regulatory filing Audit findings, filings on time

The switch to outsourcing changes who runs the work, not the metrics. A Manila-based provider handling AP for a Sydney insurer still reports days-to-close and error rate — the SLA moves with the work.

For roles from data entry to accounting to payroll, the pattern is the same: standardize the process onshore, document it, then hand execution to the offshore team.

Examples

Real-world back-office setups vary by scale, industry, and geography. The four cases below illustrate the range, from BPO pioneers of 2005 to modern mid-market builds.

Genpact (2005): spun out of GE's own back office, now serves 800+ Fortune 500 firms across finance, procurement, and analytics. TCS running Nielsen (2007–present): global finance close handled from India, with 10+ countries consolidated in one shared-service model. Wells Fargo Manila hub (2011–present): anti-money-laundering, compliance, and mortgage-processing back office running 24/7 from BGC. Australian mid-market firm: stacks a Philippine BPO team on top of a 15-person onshore ops group, cutting total cost per transaction by roughly 55%.

Finance-and-accounting is the biggest back-office segment. Mordor Intelligence put global FAO at USD 54.79 billion in 2025, projecting USD 85.92 billion by 2031 at 7.78% CAGR. Everest Group tracked steady 10% year-on-year growth in FAO through 2022 and 2023.

Related terms

Back office is one node in a wider outsourcing map. Each related term below covers an adjacent function, tier, or delivery model that touches the same operational spine.

Business process outsourcing: the umbrella model that delivers back-office work at scale. Knowledge process outsourcing: the higher-skill tier covering research, analytics, and legal support. Bookkeeping: a core back-office finance task, often the entry point for FAO deals. Payroll: the recurring back-office cycle that ties finance and HR together. Data entry: the most-outsourced back-office task by seat count. Contact center: the front-office cousin that the back office feeds and is fed by. Service level agreement: the contract that governs back-office quality and turnaround. FAQ What's the difference between front office and back office?

Front office touches the customer: sales, marketing, service. Back office supports it: finance, HR, IT, data, admin. Middle office (risk, compliance, ops management) sits between the two. Most companies have all three; the labels shift by industry.

Which back-office functions get outsourced first?

Data entry, payroll, and accounts payable are the highest-volume, most-standardized work and usually go first. Companies then move into HR admin, IT service desk, and compliance filing. Strategic finance and executive HR usually stay onshore.

How much does back-office outsourcing save?

Roughly 55% to 75% on labor cost for equivalent seats moved from a US or Australian city to Manila or Bangalore. Actual savings after transition, retention, and quality overhead land closer to 40% to 50% in year one.

Do outsourced back-office teams need onshore oversight?

Yes, for the first 6 to 12 months. After that, the best engagements run with a small onshore coordinator (roughly 1 seat per 20 offshore) and monthly business reviews. Fully hands-off is rare — and usually a red flag.

What's the biggest back-office outsourcing risk?

Loss of process knowledge when the offshore vendor cycles staff. The fix is documented SOPs, not vendor loyalty. Manila teams average 18-month tenure vs 30 months onshore; assume the seat, not the person, is what you're buying.

Ready to move back-office work to a team that can run it end to end? Compare vetted providers on the Outsource Accelerator hubs directory.

What is Human Resources?

Human Resources

Human resources is the business function that hires, pays, develops, and retains the people a company depends on. HR teams manage recruitment, onboarding, payroll, benefits, training, compliance, and employee relations — the full employee lifecycle from application to exit. Every company beyond a handful of staff runs some version of it.

Modern HR splits into two lanes. Strategic HR partners with leadership on workforce planning, culture, and skills mix. Operational HR runs the day-to-day admin, from timesheets to grievance intake.

The function has grown far beyond payroll paperwork. Today's HR chiefs sit on executive teams and shape board decisions about retention, DEI, and future capability.

Many mid-sized firms now outsource one or both lanes to specialist providers, cutting cost and freeing internal HR for higher-value strategic work.

Key takeaways HR covers the full employee lifecycle: hire, pay, train, retain, and exit. Philippines-based HR support runs USD 6–15 per hour, versus USD 25–45 per hour for equivalent US in-house work. The Philippines IT-BPM sector — including HR outsourcing — employs about 1.9 million people, targeting 2.5 million by 2028. Commonly outsourced HR functions: payroll, recruitment, training, benefits admin, and compliance filing. Strategic HR (culture, leadership, exec comp) generally stays in-house; transactional HR is a natural outsourcing candidate. How it works

Human resources runs the employee lifecycle end to end. Teams handle recruitment, onboarding, compensation, benefits, training, performance management, employee relations, and offboarding, plus statutory compliance with local labour law and tax rules.

Larger firms split the work across specialist roles: talent acquisition, compensation and benefits, learning and development, HR business partners, and people analytics. Small firms typically run one generalist HR manager reporting to the CEO or COO.

Most HR now flows through cloud HRIS platforms. Workday, BambooHR, and SAP SuccessFactors store employee records, run payroll, track training completions, and pipe data into people analytics dashboards for the leadership team.

HR sub-function Typical scope Common outsourcing model Payroll Salary calc, tax, statutory filings Full-service BPO Recruitment Sourcing, screening, interviews RPO (recruitment process outsourcing) Training Onboarding, LMS content, upskilling Vendor + in-house blend Benefits admin Health, retirement, leave records Broker + outsourced admin Compliance Labour law, tax, workplace safety Legal counsel + in-house

Outsourced HR support from the Philippines typically costs USD 6–15 per hour per FTE, against USD 25–45 per hour for equivalent US in-house teams. The comprehensive guide to outsourcing human resources walks through the full operating model.

Examples

HR runs at every scale, from a startup founder wearing the "chief people officer" hat to global enterprises with thousands of HR staff. Below are four representative real-world setups spanning enterprise, tech-enabled, and BPO-delivered HR.

Google (United States, 2006 to present). The People Operations team, formalised by then-SVP Laszlo Bock, pioneered data-driven hiring, retention analytics, and structured interviews across roughly 180,000 staff. Their published research reshaped how Silicon Valley thinks about performance reviews.

Unilever (United Kingdom, 2016 to present). Unilever pairs with recruitment-tech vendor Pymetrics to run gamified assessments across its early-careers pipeline, screening hundreds of thousands of applicants each year and shrinking time-to-hire by roughly 75%.

Concentrix (Philippines and India). One of the world's largest BPO providers, Concentrix runs internal HR for its own 440,000-plus staff and delivers HR-BPO to enterprise clients across payroll, recruitment, and training. See Clutch's BPO directory for peer benchmarking on client reviews.

IBM (Global, 2023 to present). IBM's Watsonx AI-augmented HR platform handles internal case management and career-pathing across 280,000 employees, freeing HR generalists for coaching and organisational-design work.

Related terms

Human resources sits inside a wider cluster of workforce, outsourcing, and back-office terms. The definitions below give a fast orientation to concepts you'll meet alongside HR in any BPO conversation.

Full-time Employee (FTE): the standard headcount unit used to price HR-outsourcing contracts. Payroll: the salary-calculation and disbursement function HR either runs directly or hands to a BPO partner. Business Process Outsourcing (BPO): the broader category of contracted-out back-office and front-office work that includes HR services. Knowledge Process Outsourcing (KPO): the higher-skill outsourcing tier for HR analytics, comp modelling, and workforce strategy. Back Office: the internal support-functions bucket that traditionally houses HR alongside finance and IT. Service Level Agreement (SLA): the contract clause defining vendor response times, quality thresholds, and penalties for outsourced HR work. Offshoring: the practice of moving HR delivery to a distant lower-cost country, typically the Philippines or India. Nearshoring: the closer, same-timezone variant, popular for HR support serving US clients from Latin America. FAQ What does human resources actually do?

HR runs the employee lifecycle: hiring, onboarding, paying, training, developing, and eventually offboarding staff. It also owns labour-law compliance, benefits administration, workplace policy, and increasingly workforce analytics.

What is the difference between HR and payroll?

Payroll is one sub-function inside HR that calculates and disburses salaries and files statutory taxes. HR covers the whole people function, of which payroll is roughly 10–20% of the workload.

Can HR be outsourced?

Yes. Recruitment, payroll, benefits administration, training, and compliance are all commonly outsourced, either as isolated services or as full HR-BPO packages. Strategic HR, culture-shaping, and executive coaching normally stay in-house.

How much does outsourced HR cost?

Philippines-based HR-outsourcing rates typically run USD 6–15 per hour for generalist and admin roles, and USD 15–35 per hour for senior HR business partners. Nearshoring from Latin America sits around USD 15–25 per hour depending on seniority.

Which HR functions should stay in-house?

Culture-setting, executive coaching, senior leadership hiring, sensitive employee-relations casework, and any function requiring deep organisational context. Everything else is fair game for outsourcing.

How big is the HR-outsourcing market?

The wider global BPO market, of which HR is a major segment, was pegged at USD 347.95 billion in 2025 and is projected to grow at 10.05% CAGR through 2035 per Precedence Research. The Philippines alone hosts roughly 1.9 million BPO workers per the IT and Business Process Association of the Philippines.

Compare HR-outsourcing partners and pricing on the Outsource Accelerator hub.

Companies you might be interested in

Get Inside Outsourcing

An insider's view on why remote and offshore staffing is radically changing the future of work.

Order now

Start your
journey today

  • Independent
  • Secure
  • Transparent

About OA

Outsource Accelerator is the trusted source of independent information, advisory and expert implementation of Business Process Outsourcing (BPO).

The #1 outsourcing authority

Outsource Accelerator offers the world’s leading aggregator marketplace for outsourcing. It specifically provides the conduit between world-leading outsourcing suppliers and the businesses – clients – across the globe.

The Outsource Accelerator website has over 5,000 articles, 450+ podcast episodes, and a comprehensive directory with 4,700+ BPO companies… all designed to make it easier for clients to learn about – and engage with – outsourcing.

About Derek Gallimore

Derek Gallimore has been in business for 20 years, outsourcing for over eight years, and has been living in Manila (the heart of global outsourcing) since 2014. Derek is the founder and CEO of Outsource Accelerator, and is regarded as a leading expert on all things outsourcing.

“Excellent service for outsourcing advice and expertise for my business.”

Learn more
Banner Image
Get 3 Free Quotes Verified Outsourcing Suppliers
4,000 firms.Just 2 minutes to complete.
SAVE UP TO
70% ON STAFF COSTS
Learn more

Connect with over 4,000 outsourcing services providers.

Banner Image

Transform your business with skilled offshore talent.

  • 4,000 firms
  • Simple
  • Transparent
Banner Image