People are a company's greatest asset. But they are also the most expensive. The costs associated with hiring, training and managing staff can quickly become a company's largest expense. There's no denying that hiring, training and managing employees is a major challenge for any company. However, that doesn't mean you have to do it all yourself. Outsourcing is the process of delegating certain tasks to a third party instead of doing them internally. This includes hiring an outside company or individual to take care of your company's human resources issues, such as hiring new employees, creating employee contracts and benefits packages, payroll, and so on.
Why should you outsource your HR department?
The most important reason for hiring an external HR manager is to reduce your costs. Human resources is one of the biggest costs for most companies. And as the cost of managing employees continues to rise, companies are looking for ways to cut expenses. That's exactly where outsorucing comes in. By outsourcing the HR department, you don't have to hire a full-time HR manager, who takes care of hiring employees and managing relationships with them. Plus, you don't have to pay for benefits (including health insurance), sick days, vacation and other perks. Instead, you pay a set fee for a package of services you choose. The huge advantage of this is that you can add or cancel other services as needed. So these packages can be tailored to you. Additionally, you can also have individual services taken care of, such as recruiting. However, besides what I just mentioned, there are other advantages.
5 advantages of outsourcing your HR department
- Higher productivity: When you outsource your HR department, you can expect to see an immediate impact on productivity, especially in small and medium-sized businesses where HR is often neglected or handled by one or two people. Most outsourced HR managers bring a company-wide approach to managing employees, which translates into higher productivity. This is due to the fact that many outsourced HR managers are familiar with process-oriented management, which involves implementing and following detailed workflows and procedures. In addition, the outsourced person is able to focus 100% of his or her time on HR tasks, rather than still having to attend to other areas of responsibility.
- Access to expertise: If you want to establish and manage a human resources department in your company, it makes sense to hire people with experience in this field. However, HR is not a field in which most people earn a degree, but rather acquire their knowledge over years. By outsourcing your HR department, you can rely on experts and professionals who have already gained experience and can therefore help you overcome any HR-related challenges.
- Access to knowledge and best practices: Running a successful business is a science in itself. That's exactly why there is a wealth of research and data that shows what businesses need and what they don't. However, it is not possible for every business owner to keep up with all of this information. External HR managers have just the opportunity to deal with these issues and are therefore always up to date.
- Reduce costs: As we mentioned earlier, the cost of hiring full-time staff is high. Therefore, from a financial perspective, it is beneficial to outsource your HR functions. Companies that outsource their HR functions are able to eliminate the burden of recruiting, hiring and retaining employees in their HR department. They also no longer have to pay for benefits, insurance coverage, healthcare costs and other perks.
- Expand your services: Finally, one of the benefits of outsourcing your HR department is that you can expand your service offerings. For example, if you outsource your payroll, you can also offer payroll services to your clients.
Hiring an outsourced human resources manager
If you decide to outsource your HR management, you need to find the right external HR manager. Outsourced HR managers are often referred to as outsourced HR generalist or outsourced HR specialist. An outsourced HR manager who acts as an HR generalist will help you with everything from hiring to firing employees, maintaining employee relations, creating job descriptions, writing contracts, and drafting employee policies. An outsourced HR manager, who acts as an HR specialist, helps you with one or two specific tasks. For example, an outsourced HR manager who specializes in hiring will help you with the hiring process and drafting job descriptions and interview questions. Outsourced HR managers who specialize in employee relations will help you manage employee relations (including terminations and grievances).
2 Expert Strategies for Finding an Outsourced HR Manager
The best way to find an outsourced HR manager is to work with a reputable staffing agency. A recruitment agency has access to a large database of HR professionals who are willing and able to hire new clients. This agency handles all the work involved in finding an external recruiter and screening applicants. When searching, look for these qualities:
- Experience: You want to hire someone who has experience managing a company's human resources. Someone who has hired employees before and has experience in dealing with employees will be able to hit the ground running.
- Credibility: The person you want to hire should be credible and well known in the industry.
- References: References are one of the most important things, because they tell you what others think of the outsourced HR manager's services and whether they would recommend working with them. Therefore, check them carefully.
- Competence: You want to hire someone who is competent. Competence comes from experience and expertise. Make sure the person you hire is up to date on the latest trends in the staffing industry.
- Cost: Lastly, keep your budget in mind and make your choice accordingly. There are many different ways to find an outsourced human resources manager. The best way is to engage a staffing agency.
3 Ways to use outsourced personnel
Now that you know what outsourced HR is and the benefits it can have for your business, you may be wondering how you can actually implement it. Below are a few ways you can outsource your HR department:
- Outsource your hiring process: One of the best ways to outsource HR tasks is to outsource the hiring process. This means that when you hire new employees, instead of hiring them yourself, you outsource the hiring process to an outsourced HR manager.
- Outsource your employee relations: If you are conflicted about managing employee relations, outsource this function to an external HR manager. Many outsourced HR managers offer a complete package of HR services that includes employee relations.
- Outsource your payroll: When you outsource your payroll, you relieve yourself of the burden of managing payroll, benefits and other payroll-related tasks.
It's undeniable that hiring, training and managing employees is a major challenge for any company. However, that doesn't mean you have to do everything yourself. Outsourcing offers you many options to make your company's everyday life easier. Whether you want to outsource your entire HR department or just components. If you want to find out more, visit our HR Outsourcing website.