Top 4 best practices for outsourcing HR

Top 4 best practices for outsourcing HR

Today, small and mid-sized businesses (SMBs) are up against changing dynamics in the workforce, technological problems, and compliance issues. To help combat these problems, Human Resources Outsourcing (HRO) enables SMBs to move important areas such as administration, payroll, recruitment and training to a professional HR company. HRO can help keep your operational costs low as well as streamlining processes.

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Here are four HRO innovations that can help SMBs add value.

1 Employ process documentation

Process documentation helps outsourced HR employees to familiarise themselves with a firm’s HR procedures and policies. It’s important to have a process document detailing how to ensure best practice in case someone external needs to carry out HR duties.

2 Choose an HR consulting firm to partner

Whether you are outsourcing a single task or your complete HR function, an HR consulting firm is suggested. (Single HR consultants are only recommended for one-off projects.)

SMBs tend to require help over a wide variety of activities, so they require diverse skills and staff from their HR consulting firm. Large consulting firms offer technical expertise which is a valuable asset for SMBs seeking to save money. Large HR consulting firms also have advanced end-to-end tools at their fingertips, letting them perform repetitive and manual tasks to scale.

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3 Employ powerful HR software

For SMBs, powerful HR software answers all manner of issues and is cost effective. The consulting firm’s HR software will have compliance regulations embedded and will also provide data management of employees, storing all the information in the Cloud (with employee self-service available through a mobile app or the Internet).

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4 Measure your return on investment

Outsourcing strategies involves specific goals. However, once the outsourced system is functioning, organisations often fail to comprehend whether they have achieved their plans.

Measuring your return on investment is vital. Well-designed metrics can enable organisations to:

– clarify expectations regarding stakeholders and key priorities
– compare results for various time periods
– monitor internal customers’ satisfaction with the HR programme
– ensure that data drives decision-making.

Keep in mind your firm’s long-term and short-term goals, review your finances, and assess the role of HR in the grand scheme of things. You can then start up HRO successfully.


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