To Outsource Human Resources? That is the Question

Human resource (HR) functions are one of the most essential departments of any organization. This team is responsible for every facet of employee management from recruitment, selection, hiring and training new employees up to payroll services, management employee benefits, complaints and overall employee satisfaction to ensure that the people in your company are well taken care of and generally in a healthy and happy working environment.

But for small to medium sized businesses, setting up an effective and efficient in-house HR department may be challenging most especially HR management is both comprehensive and complex. Having the right resources, the right people and the right process is the formula for having an effective HR department which all in all can be costly. That is why outsourcing this function is always a smart move. This article will give you a roadmap on what HR functions you can outsource and what are the benefits in doing so.

HR teams you can outsource:

Building an HR support team will ensure administrative duties and non-client facing functions to keep your business up and running. And one of the good benefits of outsourcing this is that you can build different elements of HR functions without the administrative burden.

HR Admin Support

Responsible for recruiting the right people for your unique needs. Their A+ recruitment process ensures building a great, high-performing team. They are also responsible for employee relations, payroll, benefits, and training making your outsourced teams happy and taken care of.

Data Entry Management

Want a well-maintained business database? This team will handle and update your customer and company information accurately with minimal errors.

Payroll Services

Happy employees are well-compensated employees. Allow your payroll services team to calculate and process payment systems ensuring timely payments to your people. This service not only ensures proper pay is given but wage and hour laws are practiced to ensure compliance with the state and federal laws regarding paying your employees.

Sales Enablement & Marketing

Develop effective sales strategies and fresh marketing concepts by providing sales support to contact generation and management of sales documents. They will scout new leads and convert them into financial opportunities to keep your business growing.

Benefits of Outsourcing Human Resources:

The main benefit of outsourcing this department is having administrative support so you and your core team can focus on achieving your business goals. To further appreciate this, we highlighted other benefits of outsourcing this function:

Provides Operational Cost Savings

HR management is very costly. The more employees and teams you want to build for your company, the more HR staff you need because challenges will arise if one HR employee will focus on recruitment, hiring and payroll services. But hiring different HR teams mean operational expenses such as salary, benefits, taxes, office space, computer, and necessary tools per department. Remember that even if HR is crucial to every company, they don’t generate direct revenue hence maintaining an in-house team requires a significant amount of resources.

But outsourcing this with the right partner allows you up to 70% cost savings in operational expenses. They will help you cut down employee acquisition costs, training costs, salaries, and the tools and office requirements to keep this department running. Your outsourcing partner will effectively manage limited resources yet ensuring that they build you great, high-performing HR teams.

Access to Specialized HR Talent

The right outsourcing partner will build you a highly capable HR team who are experts that specializes in specific HR functions that are essential to improve the quality of your people management and administrative needs. In addition, they will streamline overall HR processes resulting in a more cohesive and effective HR management and administrative duties. If you have a team that solely focuses on HR tasks and people that are equipped with the right skill sets in human resources, it will essentially improve the quality of your HR department.

Effective Risk Management

With the vast federal laws and regulations that businesses need to be fully aware of and to follow, to remain compliant can be very challenging especially with the constant updates and new regulations that are routinely being implemented. Yet, if your organization is unable to keep up with these constantly changing laws and regulations, it results in noncompliance which can lead to serious financial consequences.

But your outsourced HR teams can stay on top of all relevance changes and will perform regular audits to ensure compliance. They will ensure compliance with hiring, insurance and benefit regulations which helps not only avoid legal issues but overall protect your employees.

Allows You to Focus on Growing Your Business

HR plays an important role in the success of your company because the administrative burden is taken from your already full plate of responsibilities, allowing you to focus more on what you do best — achieving your business goals.

Your HR department will grow as your business grows. By outsourcing this department, it will take off a significant strain not only on resources but also employee management so you can focus more of your time and resources on matters that directly relate to the growth of your business.

When looking for an outsourcing partner, another thing you must remember is to partner with one that has a High Net Promoter Score.

Why does a high Net Promoter Score equate Operational Excellence?

Net Promoter Score (NPS) helps businesses gauge the quality of the customer service offered by outsourcing companies. Organizations can use NPS to assess which outsourcing service is best to partner with because this score shows loyalty trends and growth revenue outputs.

In a way, NPS represents the primary way customers survey their experience because it means that their clients are happy which results in customer loyalty and retention, making this a critical trait a BPO company should have. When used correctly, NPS (of at least 60%) can tell you how well the BPO is performing, how often they resolve issues, and if their clients are satisfied with their experience.

Look for a trusted outsourcing company that can help you build a dedicated F&A team that has: