Management can only be as productive as the departments that comprise their organization. When any area is operating at a below-optimum level, a manager will often have to step away from their everyday high-level work to provide support. Nowhere does this happen more than in Human Resources departments.
Executives and management need to be focused on achieving business growth, not a payroll glitch that requires them to spend an entire afternoon on conference calls. If you can relate to this scenario, then our 5 reasons to outsource your HR this year are a must read.
The fast-paced contemporary business landscape constantly leaves management short on time. Faced with a number of large responsibilities, HR concerns only consume more of their limited hours in a day. Handing off complete HR responsibilities to experts takes a vast amount of concerns and tasks off the agenda.
In fact, businesses that outsource HR grow 7 to 9% faster in large part because they can focus on their core competencies. Human Resources issues can arise quickly and take weeks or months to resolve. Avoiding this drain on time grants executives the rare luxury of additional hours in their work day.
Outsourcing is not free, but in most cases it is the most cost-efficient way to operate an HR department. When an organization outsources, they save on average 21% on HR administration costs. Take a look at your internal financial statements and imagine 1/5th of the HR budget being immediately slashed, while at the same time improving expertise and offering more HR services than before.
A great outsourced HR partner can provide world-class training to employees, making them more efficient. This means they spend less time confused about procedures or looking for direction. Outsourcing also means you don’t have to pay individual salaries for HR employees. A single fee to outsource your entire HR department is typically lower than the combined salaries of internal HR staff.
A sometimes-overlooked benefit that occurs when you outsource your HR is a stark improvement in recruiting and onboarding. Human Resource organizations are already connected to robust talent pools and can rapidly move from a job posting, to an interview, to a hire, faster than traditional organizations. Versed in modern channels of recruiting such as social media, the increased hiring speed of a great outsourced HR department is able to change with the times.
Increasing speed does not mean decreasing quality in this case. With a large reach and recruiting specialists, an HR outsourcer can also provide expert talent matched to the role needed in your business. Additionally, the employee experience is improved through dedicated resources and additional employee benefits. As a result of being a great fit for the company, enacting retention strategies, and experiencing an enhanced environment, companies that outsource HR enjoy a 10 to 14% lower turnover rate. Simply put, when workers are happy they stay longer.
Traditional, outdated operating procedures for Human Resources departments are no longer a viable business strategy in 2017. Privacy breaches, cyberattacks, and housing a tremendous amount of sensitive information quickly add weight to the shoulders of those responsible.
When you outsource your HR to a modern PEO, these heavy burdens are removed. An HR partner will bring their state-of-the-art applications and payroll/employee portals with them. They should be current on protecting private employee information and records from any sort of virus or attack by having access to the latest technology and knowing how to secure it. The worry of finding the right software that will protect your employees is alleviated.
The right outsourced HR organization is comprised of experts knowledgeable in regulations and compliance rules, even ones specific to certain industries. These rules can change rapidly, and companies cannot afford staying out-of-date in this area when one misstep or violation can have a significant negative impact on the bottom line. HR compliance can distract from your 2017 business goals when not outsourced.
With so much at stake in the realm of Human Resources, it makes good business sense to outsource your HR this year. When a great PEO partner takes control, your business can become more sharply focused on the expertise and products you provide, all while saving time, money, and overall improving your organization.