HR Outsourcing Saves Time and Money So Your Business Can Grow and Thrive
As you continue to expand your business, your human resources (HR) responsibilities will also grow. This makes it extremely important to develop and streamline your HR processes to support your employees, increase efficiencies, link with top talent, and ensure you’re following evolving rules and regulations.
Overall, HR outsourcing can improve your bottom line while giving you more free time to focus on your company. But how does HR outsourcing work, and what can your company do to expand upon it?
Throughout this article, we will take a deeper look into HR outsourcing and how your business should start implementing it.
What is HR Outsourcing?
To put it simply, some businesses hire an outside company to manage their human resources tasks. These companies will take care of some or all of a business’s tasks, including (but not limited to):
Benefits Procurement and Administration - HR outsourcing firms can find you high-quality, affordable benefits that will allow you to garner top talent and provide current employees with necessary health and financial benefits. Beyond helping you discover the right package for you, HR firms can also help administer these benefits through a program.
Employment and Labor Law Compliance - It’s no secret that the U.S. regulatory landscape concerning a workforce and business is constantly changing. It can be quite a headache to dig into and keep up-to-date with these laws. A quality HR firm will ensure that your business consistently complies with all federal, state, and local laws.
Payroll Administration - Every business has a payroll checklist that can be a full-time job. This is one of the reasons why an HR support team is excellent for giving you some free time. They’ll be able to provide you with payroll tax filing, reporting, benefit deductions, time-tracking, and more.
Performance Management - If you’re looking to further job satisfaction and engagement of your employees, HR outsourcing can provide you with training and performance-management programs.
Recruiting - Finding top talent is never easy. Outsourcing can allow you to hire team members that will provide long-term benefits for your business while also managing all aspects of the hiring process, such as sourcing candidates and interviews.
Risk Management and Workplace Safety - It’s important to provide your employees with a safe work environment. HR outsourcing firms can provide you with tools that will help to prevent workplace accidents.
If you still aren’t convinced, recent studies have also shown that HR outsourcing has helped businesses grow 7% - 9% quicker than companies that don’t implement the practice.
How Can HR Outsourcing Help Your Business Grow and Thrive?
HR can be responsible for several different tasks, and it’s up to you to determine whether the cost of the service will be worth it in the long term. There’s no denying that HR outsourcing can free up your spare time and give you more of an opportunity to focus on your business. But if the costs outweigh the benefits, HR outsourcing may not be your number one option.
At least, not for everything. Again, it’s entirely up to you to determine what you expect HR to achieve and what you hope to accomplish internally. Here are just some of the ways HR can help you:
Boost Morale of Employees
If you have a team of top talent, it’s naturally in your best interest to do everything to retain their employment. The best way to do so is by boosting their morale.
HR outsourcing can help with this in several ways. Most notably, through payroll, benefits, and career development. In addition, by incorporating HR outsourcing, you’ll have an easier time providing your employees with the resources they need to continue with their work.
This not only reduces employee turnover but also helps in recruiting new members to your team. As your relationship with HR develops, it’s natural they’ll find other ways to save you money, such as by finding better benefits packages.
Increase Business Efficiencies
When you find yourself caught up in day-to-day routines, it can be challenging to focus on the long-term goals of your business. However, most of these routines are tasks that can be undertaken by HR, including running a payroll, cutting checks, reviewing insurance claims, and so on.
You have full customization over how much outsourcing you’re looking for within your company through HR technology solutions. You can properly plan for HR tasks and, through this, ensure that you’ll increase productivity, better manage your work schedule, and reduce the potential of errors.
Lower Costs
If you’re a small- or medium-sized business, it may seem difficult to justify the cost of HR outsourcing. However, the cost of HR outsourcing will likely save you money in the long run.
According to the Society for Human Resource Management, the cost to manage HR and administrative functions in-house is around $3,000 per employee per year. These costs tend to drop to about $450 per employee per year with HR services.
If you’re uncertain whether or not HR outsourcing will lower the cost of your business, it can help to map out expenses you currently have and compare how those expenses will be affected through HR outsourcing.
Obtain and Commission Qualified Employees
Recruiting top talent is key to ensuring your business can successfully thrive. However, HR outsourcing can not only do this; outsourcing can in a proactive and targeted manner.
By building a solid network of talent, you’ll likely benefit long-term. Furthermore, you’ll save money on the cost of the recruiting process and develop a better company culture.
Final Word
As discussed, HR outsourcing is fully customizable. You don’t need to sign up for their most expensive program - instead, you can allocate money to where your needs currently are and work up from there.
While the cost of HR outsourcing may seem like an initial burden on your company, there’s a good chance it will help your business prosper and, in turn, generate more revenue.
