How Outsourcing HR Can Help Your Business
Every successful business model holds one common goal – the bottom line. Whether your business can afford to undertake a long-term strategy or must operate under short term goals, profitability is a factor which can not be ignored. Therefore, when it comes to developing a Human Resource department, opinions can become sharply divided.
On the one hand, HR, in and of itself, is not a revenue generating department for most businesses. Most owners see HR as an expense of their operating costs and frequently assign such departmental tasks to individuals performing other roles and duties.
On the other hand, HR does contribute to the profitability of an organization through a myriad of ways. A well run HR department will result in expense reductions and cost avoidance tactics that are often difficult to itemize on a balance sheet but can be financially hazardous if ignored.
For many organizations the solution is in outsourcing HR. Because the model can allow you to utilize and tailor a program to fit your needs, your investment is allocated where you deem it a priority. Below are the top 4 areas where HR contributes to profitability and how outsourcing makes it a viable financial fit.
Recent SHRM surveys indicate that 23% of companies elect to outsource a function of their HR department in order to allow their in-house top talent to focus on the business strategy that is their specialty. Outsourcing allows organizations to utilize high level strategic partnerships where they are best suited. The cost savings can be found in avoiding overpaying strategic partners for administrative level work.
It should come as no shock that many organizations outsource to improve compliance. With an ever increasing maelstrom of compliance requirements and changes, the constant threat of violations or individual lawsuits are more than just “what if” statements. Protecting your organizations against such financial loss is as simple as outsourcing the right training and policy experts.
IT Tools and Technological Expertise
Few would dispute the cost savings associated with the advancement of IT tools and technology. HRIS systems and payroll services frequently provide cloud technology that connects virtual workforce tools directly to your employees. While such technology may be out of the price range for many small or medium businesses to undertake on their own, economies of scale can level the playing field and provide cost effective access for most businesses.
Benefit and Recruitment Expertise
The essence of most business operations can be found in their employees. Recruiting top talent requires an investment of time and expertise. Organizations that simply rely upon job board postings and outdated benefit programs are likely to find themselves missing out on the top talent their organization needs most. Likewise, unnecessary turnover creates a financial drain in loss of expertise as well.
Outsourcing recruitment and benefit programs can help organizations find and keep talent. Outsourcing can contribute to your organization’s financial profitability and performance. However it is important to find the right partner for your business needs. Look for an organization willing to help you survey and assess your strengths and weaknesses. Outsourcing works best when a partnership exists between your in-house talent and your outsourced choice. Ultimately, the partner you choose should be able to demonstrate expertise in the areas that you need it most when you need it most.
For assistance with any or all of your human resources needs, HR Affiliates, provides solutions.