THE HR DIGEST: Top Reads on Outsourcing

Human resource outsourcing (HRO) takes place when a business or a company directs an external supplier to take the risk and responsibility for functions of HR and perform business related tasks.


Here are our top reads on human resource outsourcing that you may find helpful:

Quit Outsourcing for Good

Organizations that have successfully created and maintain brand stature consistently are rare. There are many who keep trying to achieve these goals, but fail badly. According to a research carried by Bain & Co., there is hardly one in every ten organization that have achieved sustainable growth with profit. The outsourcing capability is one such quality, which places the winner apart.

Primarily, off-shoring and outsourcing started as a measure for cost-cutting, but organizations that establish sustained value consistently, utilize them for meeting better strategic ends, to achieve capabilities due to lack of in-house capabilities, and to strengthen existing abilities.

HR OUTSOURCING: Sub- Contracting Human Resource Functions to an External Supplier

The most common of outsourcing is the Payroll. It is generally taken into consideration for two reasons: First, for employers, it’s a time-consuming task and secondly, there are specialists with technologies and skills for running the company compliantly and efficiently. Few businesses completely outsource their entire department of HR while others allow time-consuming tasks and make their internal resource focus on strategy.

Human resource outsourcing is a consequential strategic initiative. It helps an organization to concentrate on internal resource guiding them to perform their best in respective areas and helps to control the bottom lines. Moreover, it helps an organization by providing cutting edge ideas for their strategies and improves services and facilities to their workers and employees. It also helps in gaining the cost and saving time efficiently.

Knowing When to Outsource Your HR Functions

The never ending pile of HR paperwork on your workstation only raises one question: will there ever be a better, cheaper way to get all of this done?

A lot of HR managers are stuck wondering at this, while a few have taken a giant leap towards HR outsourcing. In fact, it has proved to work for a lot of companies.

Did you know that in a Conference Board study, around 51 percent of HR managers said that they achieved all objectives when they tried the outsourcing way, while the other 49 percent were actually unhappy with outsourcing arrangements? Want to know that major difference between these two groups?

The Conference Board study underlined the differences which have been shown below:

Outsourcing that yielded low satisfactory results were training and development, recruiting as well as employee communication.

So why are these three good for outsourcing to a vendor? A lot of outsourcing partners face difficulty understanding the company culture which leads to unsatisfactory results.

Companies that yielded highly satisfactory results and were able to save money involved outsourcing partners in the following tasks: Administration, Retirement plans, i.e. 401 (k), Pension and health benefits management. Now suppose, you have decided onto outsourcing transaction-heavy tasks, how are you going to determine which ones will be outsourced and how many of them? Read more…

Diana Coker
Diana Coker is a staff writer at The HR Digest, based in New York. She also reports for brands like Technowize. Diana covers HR news, corporate culture, employee benefits, compensation, and leadership. She loves writing HR success stories of individuals who inspire the world. She’s keen on political science and entertains her readers by covering usual workplace tactics.

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