The complexities in the world of HR have evolved and broadened, and so has the scope of HR duties that were once considered to be a part of traditional back office job. Today, the conventional payroll and benefits administration back office have crumpled in front of large HRO and BPOs. Additionally, HR departments in some companies are now shifting to third party outsource providers (TPOs).
CEOs worldwide have accepted the notion of outsourcing HR administration. Outsourcing that was once considered to be a thing only done by Fortune 100 companies is now being done by companies of all shapes and sizes.
HR outsourcing has gained momentum in the past several years. As a matter of fact, in last one decade, HR outsourcing has seen over 60 large-scale partnerships, amounting to $150 million each.
Below are the benefits of HR outsourcing:
· Less administration headache
· Strategic management of workforce
· Proactive problem solving
Before choosing to outsource there are a few steps that an organization need to take:
- Study the corporate culture. Is the company okay with giving up some control to a trusted outsourcing partner?
- Evaluate current HR forms. Focus the viability of your courses of action and whether they can be given over to an outsourcing firm to manage.
- Performance evaluations. Guarantee measurements are set up to measure the outsourcing partner’s performance and figure out if they are enhancing work process and techniques.
Companies today need to recognize that communication and change management is essential for a successful organizational shift towards HR outsourcing. Employees need to be made aware that they are going to be moved under the umbrella of an HR outsourcing partner.
Your human resources department may first be reluctant to grasp HRO on the grounds that they fear, it will take out their jobs within the company. While the removal of specific roles is likely, it is more probable that there will be a shift in duties brought on by this new relationship. To begin with, HR needs to add vendor management skills and give governance to this new relationship. This often requires a full-time team that deals with the relations, management and execution of the vendor. Also, outsourcing will empower your current HR staff to concentrate on more important things and let the HRO experts handle the value-based parts of the organization.
A lot of companies have proven that the many benefits of HR outsourcing outstrip the regular challenges that are faced. It is essential that you take time and evaluate your company’s prerequisites and outsource the services that will enable you to focus on your core competencies that will provide a competitive edge.