>>SNAPSHOTS
Marriott Hotels, Ltd.
www.marriott.co.uk
Location: More than 65 locations throughout the
U.K. Employees: 12,000 Oracle products and
services: Oracle On Demand; Oracle E-Business
Suite, including Human Resources Management
System and Payroll; Oracle Discoverer
But Marriott Hotels executives had a plan. They selected a
strategy called business process
outsourcing (BPO), which
meant contracting with Hewitt
to provide the expertise to run
Marriott’s business operations and
tapping into Oracle On Demand
for all of the necessary technology and infrastructure.
Marriott Hotels is now reaping
the benefits of this decision. BPO
has not only meant improved
cost transparency and business
efficiencies for the company;
it’s also helping Marriott Hotels
transform its business processes to address constantly changing global requirements.
“The reality, from Marriott’s perspective, is that we have
one cost, and that cost is entirely transparent to us,” Rasched
says. “We also have clarity
about what the cost will be for
the duration of the agreement,
regardless of what our business
sees in terms of growth.”
POTENT PARTNERS
Ironically for Marriott Hotels,
the Whitbread organization
announced the hotel spin-offs
in the same week that Marriott
Hotels completed a new implementation of Oracle E-Business
Suite 11i for supply chain,
finance, HR, and payroll. The
North American operations of
Marriott International, Marriott Hotels’ parent company, had
a long history of using Oracle’s PeopleSoft applications, so
Marriott Hotels and Hewitt faced a decision: stay with Oracle
E-Business Suite or switch the U.K. operations to PeopleSoft
Hewitt Associates Inc.
www.hewitt.com
Headquarters: Lincolnshire, Illinois
Employees: More than 24,000
Hewitt is the world’s largest provider of multiservice
HR business process outsourcing, with a focus on
helping organizations maximize their HR investment.
WHAT IS BPO?
Business process outsourcing (BPO)
is becoming an increasingly popular
choice even for organizations that
aren’t undergoing major business
disruptions such as a change in
ownership, says Lowell Williams,
executive director for HR services
at EquaTerra, an IT and business
process advisory firm. “When
companies look at the staggering
cost of buying and operating systems
by themselves, they sometimes turn
to outsourcing as a way, in effect, of
renting a provider’s system,” Williams
says. “You’re essentially buying
a system by the drink rather than
owning the bar.”
The top BPO solutions span
finance and accounting, including
accounts payable and receivable;
procurement, supply chain, and
workflow systems; HR; and IT,
explains Williams. Unlike software
as a service (SaaS) and other
outsourcing alternatives, BPO
encompasses the hardware and
software as well as the staffing to run
the entire business service.
Enterprises also can choose a
mix-and-match approach by selecting
a single provider or multiple providers
for the various services. Oracle’s
contribution to a BPO solution
includes a highly available and
scalable data center and expertise to
manage the IT solution, which either
BPO service providers or enterprises
can draw from. The company’s range
of business applications, including
Oracle E-Business Suite, Oracle’s
PeopleSoft Enterprise, and Oracle’s
JD Edwards EnterpriseOne, also
offer industry-leading enterprise
programs for BPO providers to offer
their clients. “Oracle is one of the
strongest players in HR technology
in the marketplace today and
stands every chance of being the
major provider of HR systems and
services,” Williams says. “In addition,
it has very strong systems in finance,
supply chain, and logistics. Those are
tremendous assets.”
BUSINESS DRIVERS FOR BPO
Six important business drivers are
pushing enterprises to consider the
BPO option. First, enterprises may
decide to use BPO so they can focus
on their core competencies within
their business segment—the areas of
expertise or intellectual property that
help them gain a competitive edge.
Essential commodity services, such
as back-office operations, can be
less costly and more efficient to run if
they’re turned over to a company that
specializes in each respective area.
“Companies decide to concentrate
on better serving their customers
by letting go of their payables,
receivables, HR, or procurement
functions,” Williams says.
Similarly, BPO can mean a higher
level of expertise in key business
areas. “If I’m in an in-house HR
department in a corporation, I may
spend 20 percent of my time on
compensation matters, 30 percent on
benefits administration, 10 percent
on learning, and the rest on recruiting
and other areas. That means
I’m a generalist. I may be doing
compensation, but I’m not a comp
expert,” Williams points out. Providers
of HR BPO, by contrast, can offer
experts in each subgenre.
