Yesterday I was talking to the Chief Executive of a food production business that employed circa 80 staff.
The business had a small HR team of three, with a fourth person employed to run the payroll. Total cost gross cost circa £100k.
“Should I outsource my HR needs?”
The inevitable question – normally followed quickly with “What are the benefits?”. My answer, why the hell not! You could still invest in HR and payroll for less than half of the cost you are currently paying and still retain the standards, systems and processes you currently use. In addition, you will be acquiring… I then launched into my list of benefits.
Legal expertise; access to a large bank of knowledge and experience; practical black-and-white solutions; input on a range of business-critical standards i.e. culture, reward systems, succession planning, talent management, apprenticeships/internships, development and training programmes; clear and concise consultants who aren’t captured in the people politics of your business; modern and up-to-date HR practises i.e. digital HR systems… and the list goes on.
Outsourcing HR is the same as outsourcing your finance function, your payroll, your health & safety functions. Many companies buy in these services for their expertise and HR is no different. As a business you will acquire both tactical and strategic help and support for less cost (financial, time, effort etc) than employing people internally.
On a tactical level your current processes will be managed and kept up-to-date by a dedicated HR Account Manager; they will also work with you to look ahead. Looking at trends, patterns and data, they can help you plan your manpower needs, identify the skills you will need to grow together with costs to enable more effective business planning and, importantly, help you maintain or develop a culture that makes your business a place people want to work in (and most importantly, stay in).
An outsourced HR function has the ability to be objective, is not influenced by in-house politics, and strives to add value at every level. It is increasingly becoming the decision of choice for businesses that are ambitious and mobile.
So, I say again, why the hell not??