Human Resources outsourcing refers to the process of contracting with a third-party company to manage either some or all of an organization s HR functions and duties. When most business owners or seasoned HR professionals think about outsourcing HR, they generally think first of who will be Outsourcing HR and what functions could be outsourced. However, HR outsourcing goes further than just outsourcing some HR functions to a third party.
Outsourcing HR to a third party like an HR consultancy allows a business owner or manager to focus on the business aspects of running the organization rather than managing and supporting the HR department. These kinds of services usually include human resource management, performance management, employment relations, talent acquisition and retention, payroll administration, recruitment services, benefits, training and development, recognition and incentive programs, labor relations, compliance, benefits, EEO, and business strategies. It is also possible to outsource HR to an external HR management service provider that will provide a broader range of business solutions. One of these providers offers their clients a full range of different types of HR outsourcing services such as Payroll processing, training benefits, talent acquisition/retention, medical benefits, disability, insurance, and worker’s compensation and benefits administration. It is important to note that there are a number of HR outsourcing companies offering their different types of services, so understanding the various HR outsourcing packages available could help you to determine if a particular type of outsourcing fits your business needs. Some of the common outsourcing packages offered by HR firms include Performance Management, Employment Services, Medical, Benefit, and Training, Recruitment and Employment Services, and Legal Services.
When it comes to developing an overall strategic picture for an organization, human resource experts help HR managers to align the interests of the business and its key personnel towards a shared vision. Strategic human resource planning (SHMP) aims to align the interests of the organization with the strategic goals of the key personnel and the key organizational and team-based processes. To help the SHMP process to succeed, an integrated HR and CFO or CMO should be involved in the process.
Companies need to evaluate their internal processes to ensure that the processes still support the organization’s business objectives. Internal HR functions, when combined with the expertise of an HR management service provider, can help companies to streamline their internal processes and reduce operational stress. Streamlining internal processes also helps companies to build stronger employee relations. The combined result of increased efficiency and improved employee relations is a reduction in worker burn-out, which is one of the leading factors leading to turnover and poor morale in the workplace.
Another effective way of leveraging the human resource resources of a company is through the employment of outside talent. Outsourcing HR and recruiting professionals who are knowledgeable in your industry and geographic area can help you to grow and remain competitive by offering specialized HR services in specific areas. For instance, an advertising agency may need to expand its talent base in the United Kingdom in the next few years as the industry continues to grow. By using the services of an external HR recruitment provider, an advertising company can ensure that its workers have the skills and knowledge necessary to meet the increasing demands of the advertising industry.
Outsourcing HR services also helps to build efficiency and save time. When an HR department takes on the additional responsibilities of administering payroll and tracking employee records, the company’s HR manager can focus on the areas of his or her expertise. In addition, a payroll outsourcing company can provide timely updates on employee records and benefits packages. Payroll providers typically implement and track payroll procedures that save time and money for the company.
An employee leasing company can also provide an effective solution for an organization’s HR department by providing recruitment services. By investing in leasing employees, companies free up HR staff to focus on other strategic priorities. By delegating responsibilities to leasing partners, an HR manager has more time to devise ways to strengthen the overall performance of the company as a whole. The strategic planning process that leasing partners facilitate allows HR to coordinate with key business partners, such as management consultants, sales representatives, and marketing managers. As the HR department begins to implement leasing operations, it is able to respond to emerging trends and developments within the marketplace more efficiently and effectively.
The benefits of outsourcing HR services are numerous. Cost savings and efficiency improvements are some of the most compelling benefits. By utilizing outsourcing solutions, an organization can save both money and valuable human capital. In addition, outsourcing HR solutions allow an organization to focus its resources on strategically managing its human resource needs. As organizations continue to progress toward organizational goals, the HR department will become increasingly important, no matter how large or small the organization.