Take A Load Off: What Outsourced Human Resources Can Do For Your Business

Companies continue to evolve and change how their daily operations occur, including what their human resource departments handle. In a little over a decade, human resource departments have shrunk in terms of number of employees and how much work is handled within the company’s walls. Outsourcing human resources has become a popular option for companies these days because of affordability, accessibility, improved compliance and available software, to name a few reasons.

The Cost of HR

It is difficult to put a finite number on how much a human resources department will cost a company, but it is certainly not cheap. Human resources departments handle employee payroll, internal complaints, worker training, professional development and more. Those employees cost money — salary and benefits — and their work takes lots of time. According to government statistics, a human resource professional earns roughly $55,000 per year.

The Pain of Managing HR In-House

Managing human resources in-house for a company can create a lot of pain, especially those that continue to grow in employee size.

  • Difficulty complying: Companies that manage HR in-house might experience difficulties complying with various rules, regulations and laws of employment.
  • Lackluster recruiting: In-house HR departments might experience lackluster recruiting due to being overwhelmed in other areas of the company, including handling complaints and training current employees.
  • Inaccuracy of data: The accuracy of data can also suffer when HR services are managed in-house at a company. The time it takes to mine and sort data, along with other HR responsibilities, could lead to employees cutting corners when it comes to data.
  • Not enough employees: Even though your company manages HR in-house, there might not be enough employees within the department to handle the volume of work. This means some projects will be tossed aside to make time for others.
  • Lack of training: Training and development of employees is crucial to the success of a company. Managing HR in-house can lead to fewer training opportunities for employees.
  • Lack of experience: Some smaller companies might have trouble putting the right person into an HR position because of a lack of experience.

Benefits of Partnering with an HR Outsourcing Company

HR outsourcing companies bring a host of benefits to the table for businesses in every industry.

  • Expand the delivery options and hours of benefits to employees.
  • Control HR costs and better manage expenses.
  • Access to superior HR software.
  • Improve the focus of the company’s core competencies.
  • Maximize the use of in-house resources.
  • Improve the credibility of the company’s HR image.
  • Save money.
  • Improve the company’s efforts with compliance.
  • Improve accuracy of data collection.
  • Increased level of efficiency.
  • Stronger return on investment.
  • Better customer service.

Common Misconceptions of Outsourcing HR

A company can experience extreme profitability if it decides to outsource some or all of its HR procedures. For outsourcing to be profitable and successful, the process must be implemented correctly and then managed properly. Despite the potential profitability, there are some misconceptions of outsourcing HR.

  • Outsourcing HR removes all risk from the company and transfers them to the contracted company.
  • Outsourcing HR turns functions into independent entities and that they do not need expert management any further.
  • Outsourcing HR removes responsibility of company from paying benefits to employees.
  • Outsourcing HR means the company loses all control of how issues are handled.
  • Outsourcing HR cannot be done while the company transforms other areas.
  • Outsourcing HR cannot be performed if the current in-house department is in shambles.

When, How and Why You Should Outsource HR

If your company has yet to outsource some or all HR processes, you will want to know when, how and why it should be done. The when is easy; the minute you decide outside help is needed for your HR department, then it is time to make the call. As for the why; your company will save time, money, and become more organized within the HR department when you outsource tasks and processes.