Tuesday, May 08, 2012
The benefits administration outsourcing (BAO) market makes up a large portion of the overall human resources outsourcing market. In 2011, the global BAO market grew 12.5 percent to account for $5.4 billion in annualized revenue, according to a study by Everest Group.
The benefits administration outsourcing market supports health and welfare, defined benefits, and defined contribution. In this niche business process outsourcing market, quick and seamless integration of provider service and technology is key to a good service relationship.
BAO clients are looking for benefit administration providers that specialize in the industry and can provide knowledgeable consultation about industry practices and regulation.
As business practices evolve, a provider with a consistent and efficient software implementation solution also adds to the value of an administration outsourcing provider. Companies are seeking BAO providers who can integrate efficiently with company processes and can also create a strong administration processing infrastructure that adds value to the company and allows them to focus on their core business lines.
Proven technology is critical to the success of a BAO provider and can be a key differentiator in the decision to outsource to a specific provider. As the BAO market grows and matures, providers with established administrative models and strong company relationships will likely receive greater contract renewals and referrals.