As the company expands, the more time consuming it is and the more responsibilities that it will handle. With this, the need to increase an expert is essential. One of the most important factors that the company needs to focus on is the people; specifically, the employees since they are the most valuable asset in a company. In human resource department, they handle the employees; they are the ones who are responsible in finding, hiring, recruiting, training and assessing the performance of their employees. Aside from this, they are also responsible in laying out the compensation and benefits for the employees while making sure that the company is complying with labor and employment law. These tasks are too comprehensive and complex and when handled to in-house might not attain the best results and could even lead to less than optimal results. Thus, lots of companies starts considering to outsource HR.

A lot of companies have started to invest to outsource HR instead since the aforementioned tasks could be administered by an outsourcing firm. Outsourcing firms are increasing nowadays and they are out there to help companies with their needs in business functions.  Not only the human resource department, but you could also outsource departments, such as accounting, marketing, information technology, manufacturing, and customer service. Hiring an outsourcing agency would be a helping hand to the company since the agencies are the experts and they undergo training and workshops for this. Since this article would focus only the HR functions, the following are the benefits that companies would gain when outsourcing HR functions:

  • save costs
  • save time
  • access to global talent
  • ability to manage risk
  • improves efficiency and effectiveness in a workplace
  • enhances employee development and skills
  • helps with compliance
  • reduces unnecessary employment-related Expenses
  • reduces cost on health insurance benefits

Aside from considering the benefits, the company must take into account the situations wherein they are already in need to outsource an HR. The following are some basic indicators that companies should outsource an HR for your company, namely: (1) lack time for primary duties, (2) spending too much money, and (3) exposure to liability.

1. Lack Time for Primary Duties

It is inevitable that when businesses grow and expand, its responsibilities is bigger. With this, one of the responsibilities that companies need to take into account is their HR duties and problems since it involves employees. Despite the importance of these matters, it is also time-consuming. Furthermore, focusing on HR problems would take time away which would result in lack of focus on the primary functions that are generating revenue. For example, when you focus more on searching the recent labor and employment laws the less you would focus on what your business is really about. Specifically, when you realize your workloads are all administrative tasks and you focus too much on HR duties which resulted you to neglect primary duties then, this is a wake-up call for you. When you outsource HR, these tasks could be done by an expert instead. With this, the company could focus on its core business functions and could help free up much time to work on activities that could actually earn revenue.

2. Spending Too Much Money

Same as spending too much time on HR duties and neglecting primary duties, when the company spends too much money on unnecessary HR costs then you have to consider to outsource an HR. An example of this would be the company increasing the incentive for the employees wherein the employees are not even being efficient and productive. Other than spending too much, when the company needs to save money then they could also outsource an HR. Specifically, you could cut cost by saving costs gain from overhead and operating costs and infrastructure costs since the mentioned expenses are both costly. When you outsource an HR, you hire experts to do HR tasks for you. The company would not need to spend training fees and provide benefits since their outsource firms would provide it for them.

3. Low Retention Rate

When the company is always facing low employment retention rate then this is one indicator that company should outsource HR instead. Facing low employment rate would sometimes lead the company to increase the incentives of the employee in order to retain employees; however, increasing the incentives of the employee is not the solution.This only increases the cost of the company instead of solving the issue of employee retention. To be specific, this is only a short term solution and not a long term one. Especially in the generation today, it is hard for employees to stay and be loyal to one company since millenials are now taking up the largest segment of the workforce. According to a study, the mobility of the millennials are high and they keep on looking for better career opportunities. When you outsource HR, they could investigate potential employees that are likely to stay for a longer time. Furthermore, the company need not to increase expenses in unnecessary incentives.

If your company is sensing such indicators, then you might want to consider to outsource an HR. Springboard HR Technologies is an executive search firm that offers HR services and solutions. Furthermore, they train potential candidates to help the candidates to achieve excellence in the workplace; specifically, helps improve the productivity of the workplace.

For more information, kindly visit https://springboard.com.ph