BY Emmanuel Zvada EVERY small business needs to manage essential human resources (HR) functions like payroll, benefits, hiring, onboarding and more. Many business owners have the ‘l know everything’ tendency and believe me all these HR basics for small businesses can quickly fall through the cracks when the owner is responsible. As a small business owner, you might be tempted to cut costs and eliminate your HR department but that is not advisable. As your business grows, so too do your HR responsibilities and HR outsourcing is the way to go.
What is human resources outsourcing?
Getting it right from the beginning is crucial especially for businesses. Many companies struggle without HR support services, and the only option is to outsource these services. HR outsourcing is an arrangement through which a business owner hires a third-party to oversee some or all of the business’ HR functions. You can outsource your company’s payroll processing, employee benefits administration, talent acquisition or all of the above and more. Many companies struggle without the aid of an HR manager or any form of HR support at all despite the constant increase in industrial relations issues. HR outsourcing may be for you if time, staff, business size or budget constraints prevent you from hiring an in-house HR department.
What is human resources and why?
Human resource management is the process of employing people, training them, compensating them, developing policies relating to them, and developing strategies to retain them. As a practice, businesses and organisations depend on many resources such as physical resources, financial resources and human capital‚ which are people. There is no doubt that people play a vital role in an organisation and hence the need for HR to make sure it governs the relationship between the organisation and its employees.
The benefits of HR outsourcing
As your business grows, so too do your human resources responsibilities. Developing and streamlining your HR processes help you take care of your employees, increase efficiencies and productivity. In that regard‚ the main benefit of HR outsourcing is having access to professionals who possess knowledge about various employee benefit schemes, insurance options, market trends, etc. Although outsourcing HR functions might not be right for all businesses, there are significant advantages to doing so, especially when it comes to saving time and money.
Outsourcing improves compliance
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As a business owner, you may be wondering about the consequences of non-compliance. Unsurprisingly, there is a cost for non-compliance and that costs can only be reduced by outsourcing from the best so as to guide and also ensure there is compliance. Outsourcing HR services also helps ensure that your employee management practices are within the scope of the law. Ensuring compliance is one of the major functions of any HR department, and it’s a multifaceted. Failing to comply with these rules can have serious financial consequences but turning to experts via HR outsourcing helps prevent that. HR compliance implies forming a set of policies in order to guarantee adherence to laws and legal regulations.
You get specialised HR services through outsourcing
Unlike an in-house consultant who may be a generalist and not have all of the specialist skills you require; an outsourced consultancy is likely to have a team of experienced experts across a range of HR specialisms.
There is huge value in having HR management consisting of experts who are ahead of trends, especially those whose aim is to give the business the best possible service. If your in-house HR staff is loaded with too many responsibilities, chances are that it may not be able to carry out all the tasks efficiently. Firms that outsource HR services are likely to have advanced methods and technology for providing HR services. Therefore, outsourcing can help to substantially streamline your HR management and maximise efficiency in the discipline.
It’s cheaper than hiring an in-house HR staff
A lot of people think that HR consultants are expensive to hire. But the truth is they are often wise investments for small businesses. Hiring a full-time HR employee will cost your business. Hiring an in-house HR team requires paying each individual a salary, not to mention equipping them with the infrastructure and tools of trade required to do their jobs.
With an outsourced HR consultancy, it’s so much cheaper to have access to a team of experts that can use their knowledge and resources to help resolve your HR issues. HR outsourcing allows you to transfer some or all of your HR-related workload to a professional organisation. They will take care of everything from payroll taxes to benefits administration.
Performance monitoring
Outsourcing improves business focus and allows management to direct staff energies strategically. The growth rate of any business depends directly on the performance of its employees. Simply put, efficiently performing employees make for an efficiently functioning company. Although managers and supervisors can monitor the performance of your staff, the HR department can also help with this task. An external HR service provider can efficiently compile data on employee performance and check whether the employees are complying with company policies. External HR service providers can also provide in-house training to your employees hence assist in improving performance for your organisation.
Most outsourced HR services
Small businesses HR outsourcing usually takes care of functions that don’t require face-to-face interaction. Some examples of HR functions that are outsourced include: payroll, recruiting, employee benefits, job evaluation and performance management, training of staff etc. In most cases, responsibilities that are more hands-on, like conflict mediation, are typically kept in-house though in reality, any HR function can be outsourced. Some organisations also outsource those HR functions which are not critical and confidential
HR outsourcing is a great way for any business to increase productivity, cut costs and focus on revenue-generating activities. Finding the best HR outsourcing service for your business can be challenging, so the more you know about the benefits, types and areas of expertise of the HR outsourcing provider, the easier it will be to choose a good HR outsourcing provider.
- Read full article on www.newsday.co.zw
- Emmanuel Zvada is a human capital consultant and international recruitment expert
