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Home > Business > Business Headline > Report

IT majors outsource work to US company

Bibhu Ranjan Mishra in Bangalore | January 09, 2007 09:26 IST

Signalling a reverse outsourcing trend, many Indian IT firms with their operations spread across the US and Europe are now outsourcing a part of their administrative work in the US to a US-based firm Hanna Global Solutions.

A US-based full-service human resource management firm, Hanna serves over 30,000 Indian employees belonging to companies like Infosys, Satyam, Wipro and Quintegra Solutions by providing low-cost administrative services in the overall area of employee relationship covering features like payroll, healthcare benefits, retirement benefits and insurance.

"Indian IT services firms operating globally require consistent operational strategies across borders and cultures. We help them manage employee benefit costs and maintain them at a steady level. Our business model also helps them (Indian firms) reduce their headcount of HR professionals in the US," said Mark Hanna, CEO, Hanna Global Solutions.

Hanna which claims to specialise in Indian firms, began by working with Wipro in 1999 when the company had just 50 employees in the US. Currently, Hanna claims to provide its services to about 10 Indian firms that have a significant portion of their workforce in the US.

Mathew Augustine, principal, Hanna Global Solutions, said its annual turnover in fiscal 2005-06 was around $5 million. The bulk of this came from its services to Indian IT companies. This year, the company is targeting a 100 per cent turnover growth since more Indian companies are showing interest in its services. It has some local clients in the US too, he added.

An annual health study by the Kaiser Permanente, a US-based not-for-profit organisation, indicates that the average healthcare claims cost per employee in a month is about $500 for US firms.

"However compared to this, the average healthcare claim cost for Hanna's clients in the US is under $300 per employee per month, which is about 40 per cent lower than the US average," said Hanna.

Global firms face unique barriers of entry when expanding operations across borders. According to Augustine, when an Indian employee lands in the US, he needs a significant amount of handholding since he is on foreign territory.

"We have created a unique Bangalore Plan for employees going from here - which will include not only payroll services but also insurance and other healthcare benefit plans," he said.

Ironically, Hanna also seeks technical support from India. It works with ClearBenefit, a partner firm in Hyderabad to manage its human resources information system, a software tool that manages employees' database.

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