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When should a business outsource HR?

Published On:
February 16, 2020

The decision to outsource your HR tasks may be met with cheers or groans depending on where you are in your HR growth. As a business owner you know that HR needs your attention in order to build a sustainable and engaged workforce that is compliant with employer regulations.

There are always potential pros and cons that a business owner should be aware of when seeking support from the outside. We’re going to talk about a few.

Potential Benefits of Hiring External HR:

Efficiency – External support can often get HR work done faster than an internal team. They are singularly focused on this task as opposed to internal personnel who may be wearing more than one hat or be pulled in more that one direction.

Avoiding & Mitigating Risk – This is always the biggest potential benefit. A professional, certified HR expert can offer you support that can help you avoid the major legal risks of handling HR on your own incorrectly.

Staff Buy-in – Having a third party expert can help get favorable buy-in from employees at a greater rate than coming from leadership. In addition an HR consultant can act as the cheerleader for leadership helping employees understand what steps management is taking to care for their employees.

Objectivity – Consultants can cut through the sacred cows that sometimes can hold an organizational leader back. External perspective can help identify issues and new strategies for your HR operations.

Filling Gaps – An HR consultant can complete all of the HR tasks that you do not want to do, have time to do, or have the expertise to do in your organization.

Potential Drawbacks of Hiring External HR:

Cost – Consultants can be expensive and may or may not be a recurring cost for additional technology or support. In addition, using a consultant can also require a significant portion of your time to be effective.

Misalignment – A third party expert or service may not fully understand your goals or the inner workings of your business. Often times this happens in nonprofit or social service organizations where HR may struggle with employees understanding the need to live within requirements versus living in mission.

Potential Risks – Just because you hire a consultant does not mean your legal liability as an employer goes away. You are still responsible for how your HR works.

It’s very important to talk through your goals, priorities and concerns with any potential HR vendor. Understanding your needs before diving into an outsourced relationship is a key component for success.

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