Abstract
The phenomenon of outsourcing has spawned a rich body scholarly reseach in sveral decades. However, the answer to one of the pertinent question has remained elusive: Does cost reduction and business strategy really matters to the human resource outsourcing impacts. Looking at this question it is important for the organization to embark on the practice of human resource outsourcing to save operating cost and remain competitive. Therefore, the objective of this study is to investigate the effects of cost reduction and business starategy towards human resource outsourcing impacts. Both quantitative and qualitative methods were employed and the top management in Malaysian Government Link Companies (GLC’) is the unit of analysis. The findings revelaved that, both variables are significant statistically and non statically i.e from the experts opinion. Finally, the study also provides useful directions for future research, HR Practitioners and policy maker particularly in managing and organizing human reseouce matters.
Highlights
Outsourcing is one of the most powerful trends in Human Resource Management (HRM)
This study employed both quantitative and qualitative approaches by surveying employees working in Malaysia Government Link Companies (GLC)
The reliability test was used for each variable to provide constant results and it is confirmed that there are no errors in the information provided
Summary
The growth in this, Human Resource Outsourcing (HRO), has promoted research into the optimal strategic conditions for externalization of HRM activities [20, 21, 35]. It refers to a contractual relationship for the provision of business service by an external provider or in simple words a company pays another company to do some work for it [4]. Nordigarden et al (2014) [29] define outsourcing as the transference of internal governance activity to external control It occurs when the organization contracts with another organization to provide service or products whether core or non-core activities. Works are traditionally done internally is shifted to an external provider and the employees of the said organization are sometime be transferred to the service provider
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