What are the benefits of HR outsourcing?

As a business owner, you may be more focused on the work that is produced by your company or the profits that are generated rather than more specific issues such as HR tasks. However, HR related tasks are extremely important when it comes to running a business, especially if you employ and manage a team of people. As a result, in the blog Centric HR discusses the benefits of HR outsourcing so you can see the difference it could potentially make to your business. 

So, what are the benefits of HR outsourcing? The main benefits of HR outsourcing include, Increased Efficiency, Reduced Cost, Speed of Response to HR Problems, and Reduced Risk.

Keep reading to find out more about the difference between HR outsourcing and HR consultancy as well as how HR outsourcing can save you time. 

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What are the benefits of HR outsourcing?

As a business owner, you may be torn between handling your own HR department and HR outsourcing. This is why we have taken the time to detail some of the main benefits of outsourcing your HR management based on information from the CIPD , in the hope that it will help to make your decision a little clearer. 

Increased EfficiencyOne of the overriding benefits of HR outsourcing is that it can significantly improve efficiency within a business. HR management tends to include many processes, whether that be recruitment processes or even paternity leave processes, all of which are important. As a business owner, it is important to consider whether you would have the time to regularly assess your processes to determine whether there are better or more efficient ways of completing HR related tasks. This may even involve identifying and implementing HR technology that streamlines your whole HR strategy. By outsourcing your HR management,  you are passing on the burden to a team of experts who are already actively and regularly assessing HR processes. This means that they can identify ways to improve the efficiency of your Hr processes a lot quicker than you may be able to, which in turn will allow for more time to be spent on other areas of your HR management. 
Reduced CostAnother benefit of HR outsourcing is that it can reduce the outgoings of your business. Running an effective HR department can cost a lot of money for a business, especially with recruitment strategies and employee benefits on top of this. By investing in a HR outsourcing system, a team of experts can effectively manage the cost of your HR function as well as offering employee benefits for a fraction of the price. Not only that, many HR outsourcing firms have an array of employee training and development resources available for you to use without spending additional capital. 
Speed of Response to HR Problems A quicker response time to HR problems is another significant benefit of investing in HR outsourcing. This is because you will have access to a team of experts who are regularly exposed to HR related issues and probably have already dealt with similar problems that you are being exposed to. This means that they will have a good method for handling these problems that you can adopt in a much shorter space of time rather than researching and assessing how to resolve it independently. 
Reduced RiskOne of the most significant benefits of HR outsourcing is that it can reduce the HR risks you are exposed to as you scale up your business. Naturally as your business expands you may find yourself exposed to more HR related issues such as disputes, contract terminations, and recruitment. As part of these issues, there are strict guidelines and laws that must be followed to ensure fair treatment of employees, which can be difficult to navigate, especially if you do not have experience in this area. This is why investing in HR outsourcing can reduce the risk of any improper conduct within your business processes as well as ensuring any disputes are handled in a professional manner. 

To find out more about the benefits of HR outsourcing, be sure to watch this informative video below. 

What is the difference between HR outsourcing and HR consultancy?

If you are seeking some help with the HR strategy of your business, you may be a little confused about the difference between HR outsourcing and HR consultancy. It is important that you understand the difference so that you can decide which one is most appropriate for your business. This is why we have detailed the key differences below so that you can develop a better understanding. 

The main difference between HR consultancy and HR outsourcing is that a HR outsourcing company theoretically becomes an extension to your business and works with you to complete all HR related activities. As the experts in the relationship, a HR outsourcing company would take on the majority of the work, whether that be rewriting your employee handbook or dealing with employee disputes. What’s more, HR outsourcing companies would also handle any delicate employment law related issues which may be out of your range of expertise. 

In contrast, HR consultancy is a great option for companies that do have a HR department but would benefit from some additional HR support. It may be that you are dealing with an employee dispute and you have not been exposed to this scenario before so you require some specific advice. Alternatively, it could be that you are going through the process of having to make some staff redundant and require some advice on how to handle this best. This is exactly when you would need a HR consultancy company rather than a HR outsourcing company that completes all of the work for you.

With that being said, if you are handling an employee dispute or legal issues and require some more information on how a HR outsourcing company would handle this, then take a read of our recent blog by clicking here. The blog discusses how employment law affects employees as well as what aspects of employment law HR companies are responsible for. 

Who would benefit from HR outsourcing?

When it comes to HR outsourcing, there are an array of different businesses and organisations that would benefit depending on their requirements. The main point to remember is that HR outsourcing companies complete HR work on your behalf, therefore if you already have a fully functioning HR department you may be more suited to a HR consultancy business. But start-ups, or businesses with limited HR experience would definitely benefit from HR outsourcing because they may not have the time, capital or expertise to complete HR related tasks themselves. 

Companies may also benefit from HR outsourcing if they are dealing with a HR issue for the first time and it is quite delicate. Examples of this may include redundancy processes, disputes, employment law problems or even GDPR issues. All of these issues require professional expertise and may require additional time that small businesses have to spare. 

HR outsourcing at Centric HR:

Centric HR is an experienced team of HR consultants from Staffordshire and Birmingham who offer a variety of HR services including HR Outsourcing and HR Consultancy. If you require some additional HR support, do not hesitate to get in touch today, and get the conversation started. 

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Picture of Sandra Berns

Sandra Berns

Centric HR was founded by Sandra Berns, a confident and versatile Human Resources and Organisational Development Practitioner with 25 years demonstrable experience and a Fellow of the CIPD. Sandra has both Operational and Strategic HR expertise across Public and Private sectors and has assisted senior teams in meeting challenging workforce objectives in many corporate environments.