Information Services Group (ISG) (Nasdaq: III), a leading global technology research and advisory firm, has launched a research study evaluating providers of HR outsourcing (HRO) services that deliver transformational business value to organizations and their workforces, increasingly through the use of AI.

The study results will be published in two comprehensive ISG Provider Lens™ reports, called Transformational HR Outsourcing Services (HRO), scheduled to be released in March 2025. The geographically focused reports will cover providers offering multiprocess HRO, health and welfare benefits administration and workforce recruitment services.

Enterprise buyers will be able to use information from the reports to evaluate their current vendor relationships, potential new engagements and available offerings, while ISG advisors use the information to recommend providers to the firm’s buy-side clients.

Transformational HRO goes beyond HR’s traditional focus on process standardization, efficiency and cost reduction, to create and deliver value to the entire organization and its employees. This approach enables enterprises to accelerate their adoption of advanced digital technologies, including AI, and broaden the scope of their HR offerings through partner networks. HRO at this level delivers actionable, data-driven insights that enable organizations to make better informed decisions and significantly boost employee engagement.

“Organizations are navigating a landscape of evolving HR needs, rapid technological advances and significant shifts in workforce demographics, values and expectations,” said Namratha Dharshan, chief business leader, ISG Research. “To help them meet their strategic business objectives and enhance workforce outcomes, enterprises are turning to providers to create new, digitally enabled HR service delivery models that are agile, flexible, resilient and efficient.”

ISG has distributed surveys to nearly 70 HRO providers serving the U.S. and global markets. Working in collaboration with ISG’s global advisors, the research team will produce three quadrants representing the transformational HRO services the typical enterprise is buying based on ISG’s experience working with its clients. The three quadrants are:

• Multiprocess HRO (MPHRO) Services, evaluating providers of integrated services including core workforce data administration, recruitment support, contact center, compensation, leave administration and payroll and performance management. Delivered business value includes cost reduction, service quality improvement and organizational agility, flexibility and resilience.
• Health and Welfare (H&W) Benefits Administration Services, assessing providers managing benefits for employees and other eligible dependents. These providers help organizations facilitate enrollment in H&W plans, verify employee and dependent eligibility for benefits programs and manage and streamline ongoing administration to enhance employee experience.
• Recruitment Process Outsourcing (RPO), studying providers of end-to-end services that help organizations better manage their recruitment lifecycles. These providers help clients identify key recruitment needs, streamline talent sourcing and develop effective candidate screening processes, often using AI and data analytics to reduce cycle times and improve the quality of recruits.

Geographically focused reports from the study will cover the transformational HRO services market and examine products and services available in the U.S. and globally. ISG analyst Gaurang Pagdi will serve as lead author of both reports.

A list of identified providers and vendors and further details on the study are available in this digital brochure. Companies not listed as transformational HRO service providers can contact ISG and ask to be included in the study.

All 2025 ISG Provider Lens™ evaluations feature expanded customer experience (CX) data that measures actual enterprise experience with specific provider services and solutions, based on ISG’s continuous CX research. Enterprise customers wishing to share their experience about a specific provider or vendor are invited to complete this online survey. Participants will receive a copy of this report in return for their feedback.