Human resource services is an integral part of any company’s proper functioning, but is also one that has taken some serious hits in order to save money in a tough economy. However, the changes that have been made, more specifically the outsourcing of human resource positions, doesn’t have to have a hugely negative impact on these businesses. Actually, when handled appropriately, outsourcing human resources positions can benefit businesses tremendously.
Human Resources is not Business Specific
HR departments traditionally handle a huge range of tasks that don’t necessarily pertain explicitly to the business at hand. Human resources is typically responsible for:
· Locating qualified professionals.
· Training and preparing these professionals for specific jobs.
· Retaining valuable employees.
· Handling employee benefits and compensation.
· Negotiating with partners.
· Facilitating appropriate labor and employee relationships.
· Collecting necessary data.
· Negotiating legal issues that may arise.
Unquestionably, all of these tasks are supremely important to the proper functioning of any company, but they are not directly related to the specific business profile. As a result, many organizations are finding that by outsourcing each of these tasks to several different contractors, they are able to get the job done satisfactorily while also saving money.
How Outsourcing Human Resources Saves Money
In the traditional form of Human Resources, there is typically an entire department devoted to the above tasks. This works great as long as a business has the means to pay for the extra costs that come along with it. For instance, employees are often entitled to certain benefits, which add extra costs to the business’s overhead.
Independent contractors do not retain the same benefits and housing that traditional employees do. As a result, when human resources tasks are outsourced to other qualified individuals, there is a drastic decrease in these costs. There is no need for a physical place of congregation because contractors typically work remotely. Also, the expensive benefits element is eliminated. The contractors can still make a decent living, but will be responsible for their own insurances and the like. Outsourcing can hugely benefit small businesses in particular who may not have the ready funds to retain many employees.
Human Resources Outsourcing Best Practice
Naturally, there are some glitches with the concept of complete human resources outsourcing. However, these problems can be widely avoided through preparation and anticipation of potential issues. For instance, outsourcing the training and retention of employees can be catastrophic if employees are not being held to an appropriate standard. Likely, these kinds of problems actually stem from an overzealous outsourcing approach.
The answer to the outsourcing conundrum is quite obvious. Although many human resources positions can be divvied out to contractors, it is also highly important to retain enough actual HR employees to oversee the entire outsourcing process. Absolutely, save the money necessary to keep a business in the black, but also understand that there are times when it is best to have a little of both worlds.
By keeping qualified HR professionals, a company is able to let their independent contractors tackle all of the small problems through a phone call, a website or an email. However, the HR employees are still able to handle the bigger problems that a contractor reading from a script simply isn’t qualified to deal with. Through this approach, businesses get the best possible outcome. They are able to save money and delegate smaller tasks to protect their human resources employees, and their pocketbooks, from being drained. Simultaneously, the same company can keep the behind-the-scenes running of their business moving along smoothly.
Victoria Heckstall in a contributing writer who enjoys informing small business owners of ways to save money and recommends checking out PEO Services for various services to cut costs.