HR Outsourcing: Description, Features and Benefits

Work with human resources assumes that the cadre has a high qualification. Even if a high-class specialist is working at the enterprise, the routine work is still dragging out and, as a rule, time for personnel management and the solution of strategic issues is simply not enough. To solve this problem, many businessmen turn to the services of outsourcing companies.

The process of transferring non-core functions of enterprise management has long been transferred to outsourcing companies, including personnel management.

Possible functions that can be outsourced to third parties

For a better perception, we combined all the functions into a table, which is presented below:

The last point, perhaps, is the most interesting. Especially if a Western company, working in our country, is switching to outsourcing. The entanglement of the current legislation, including the calculation of wages, often puts foreign entrepreneurs and managers at a dead end, and it is precisely these companies that most often outsource this function to outside specialists. Moreover, the calculation of wages does not apply to strategic action, but HR and accountants spend more than 60% of their working time on this.

The main reasons for contacting third-party specialists

Recently, HR outsourcing has become increasingly popular, and there are several reasons for this:

• Many foreign companies "come in" to our market, who are not in a position to immediately understand the specifics of our legislation;
• The founders of the company do not want to hire a lot of personnel, take care of buying and updating special software, in other words, they want to save;
• The desire of the owners of the company will focus on strategic and priority tasks, without being distracted by the selection and control of personnel;
• A rapid increase in servicing units, in comparison with the small growth rates of the core business, that is, in fact, a reduction in costs due to lower costs for personnel;
• May be the opposite situation, when the pace of the main production is much faster, and the service personnel do not have time to process everything and organize everything.
• At the enterprise a lot of branches that have different locations are scattered throughout the country, but all data flows to the main (head) office;
• The need for an urgent search for qualified personnel, for example, to launch a new project;
• Lack of specialists in the field of recruitment, payroll.

Pros of outsourcing

First of all, if the company still has a human resources department, its employees can focus on solving important issues, that is, develop strategic plans for personnel search, development, evaluation and promotion.

The second advantage: if even in the personnel department the employee becomes sick or fired, you do not need to immediately look for a replacement, the absent employee can always replace an employee of a third-party organization.

Most of the responsibility for personnel outsourcing is borne by the company involved.

And the main advantage - saving money.

Full and combined outsourcing

Personnel outsourcing of personnel is usually in the first stages only on a combined basis, that is, the functions of the personnel department are only partially transferred. Over time, when a trust is established between the enterprise and the outsourcing company, the parties are satisfied with the relationship, then all functions are outsourced to a third-party organization.

How to choose an external HR functions executive

Before deciding on personnel outsourcing, the owner of the enterprise must understand for himself what he wants to receive in the end. It is the answer to this question that gives a complete understanding of which functions should be assigned to the external company.

If there is no desire to outsource the solution of strategic issues related to personnel, it makes sense to start cooperation with a partner on the basis of HR outsourcing, and in the future to transfer the function of calculating labor remuneration. In this case, the company's specialists are released from the routine and can deal with more important issues, for example, the development of a motivational program, engage in evaluating staff.

If the main goal - the development and implementation of motivation, training and increasing loyalty to the company, it is better to contact a consulting firm. To begin with, the company will assess the state of affairs with staff, and then offer seminars or training, team building and training activities.

Examples from life

A vivid example is the need to develop a system of compensations and benefits. Such a program does not require constant adjustment, it is only once developed and, depending on the need, amends. In fact, this is a project work, so it makes sense to involve an outside organization whose specialists have experience in this field. In this case, just find a suitable company, determine the budget and determine the timing of execution. As a result, the company saves money and time.

Often there are cases when staff outsourcing at an enterprise involves only the selection of personnel. This option involves two types:

1. Recruitment is carried out on an ongoing basis;
2. Project selection, that is search or enticement of high-class specialists or top-managers.

Both options are quite costly both in terms of time and in investment of funds. In the first case, everything will depend on the regularity of personnel outsourcing services. The cost in the second case is a direct dependence of professionalism and the uniqueness of the profession, hence the considerable price of resolving the issue.

The Dangers of Outsourcing

In some cases The value exceeds the permissible standards, and it is groundless. And sometimes the offers of outside organizations are surprising by their cheapness. It may be due to a variety of factors. For example, the company does not have specialists, the entrepreneur is just starting his own business, that's why he is dumping. Other companies, on the contrary, having decided that they have no competitors, are not interested in what is happening around. Therefore, it is very important for an entrepreneur to be very cautious in choosing a partner, since not the most strategic, but still business processes are given up.

Hence another problem arises: having transferred all the functions of personnel management, the owner of the business loses control, and if the outsourcing company performed its functions in bad faith, then it will be difficult to restore the order. As soon as the problem becomes clear, it will be necessary to search very quickly for a new company providing such services, or to recruit new personnel to join the company.

Therefore, it is very important to be cautious and attentive to choosing a provider for personnel management and personnel management.

Be sure to pay attention to the availability of professional liability insurance. True, its availability is not a panacea, and therefore additionally necessarily examine the insurance obligations of the outsourcing company, specify the amount of the insurance amount.

How the price for services is formed

Depending on the chosen form of relationships, the price is formed. It will depend on a set of services that can include:

• personnel accounting;
• Outsourcing of payroll accrual and payment;
• Selection of staff;
• Adaptation;
• Psychological testing both when applying for a job, and through a certain period of work at the enterprise.

With regard to specific amounts, the cost of services, as a rule, varies considerably and is determined on a contractual basis. Specific figures are difficult to name, because everything depends on the company's pricing policy, specialization and qualification of the employees you need, as well as on the term of temporary hiring. Therefore, only average data can be given: if the number of staff and freelancers in the organization is from 16 to 50 employees, the monthly cost of services will be 100 USD + 25 USD for every 5 people in excess of fifteen. But, we will repeat, the sum is conditional enough. All figures are negotiated directly with the representative of the outsourcing company.