An opinion poll from 200 senior executives from globally prominent companies by Hewitt Associates, another U.S. HR outsourcing company, showed improved cost effectiveness and administration expense reduction were the top two reasons for adopting HR BPO services. Other merits included professional HR expertise and technology, high participant satisfaction, and the convenience and time efficiency these solutions deliver.

Local perspective

Acquiring the Shanghai-based ChinaLink enabled ADP to launch its technology-based, tailor-made OneHR, a solution to companies of various sizes in China in March 2010.

ChinaLink, established in 2003, was an HR outsourcing company with a strong knowledge of the local industry and solid tech support targeting small and medium-sized companies.

"The union between us enables us to maximize the expertise and strength of both parties to develop more localized solutions. This will enable ADP to be a complete HR outsourcing solutions provider in China," said Akhtar.

While GlobalView addresses similarities in, OneHR addresses the individuality of markets with different labor, salary and social benefit related regulations and laws.

Leveraging secure, Web-based technology and professional service delivery, OneHR provides integrated payroll, social benefits, HR management system and dispatching services to help employers in China achieve HR operational excellence.

"ADP OneHR is a solution designed to address local needs," said Akhtar. "Supported by strong people, processes and technology, we partner with our clients to consistently deliver the benefits of HR BPO engagement."

Accuracy, timeliness and compliance are three basic requirements of HR BPO services. "ADP OneHR helps local employers minimize compliance risks as it is constantly up to date on all labor, salary and social benefit-related regulations and laws," said Paul Yang, founder of ChinaLink and now Deputy General Manager of ADP China.

ADP now serves 65 multinational companies and about 180,000 to 200,000 workers in China.

While large companies worldwide have effectively slashed labor costs by 25-30 percent through adopting HR outsourcing solutions from professional service providers, the large quantities of small and medium-sized companies in China have yet to make a similar HR investment.

ADP China, for instance, currently serves clients in China's first-tier and second-tier cities, but hasn't expanded into third-tier cities where small companies flourish.

"ADP expands business with our clients, and it is a gradual, planned and controlled growth," said Akhtar. "The Chinese market is special for ADP because we have to educate and cultivate the market, and help local companies to accept first the value HR outsourcing generates and then the advantages ADP enjoys in this field."

By cultivating the market, ADP has many a success story in terms of clients, often asking clients to share with companies interested in HR BPO how the adoption of ADP's solutions helped maximize their cost effectiveness or bring other administration benefits, he said.

ADP also allows potential clients to learn of the advantages first hand through detailed demonstrations, or by helping them find out problems within their own HR administrative practices.

"It's not magic. It needs long-term cultivation and accumulation to fully tap the market potential," Akhtar said. "We came here for long-term growth and we are fully prepared for it."

The HR BPO business in China expects "explosive growth" in the coming years as Chinese enterprises grow and as an increasing number come to realize the benefits of professional HR service, said Li Hao, President of CTG, a Shanghai-based HR service provider.