Of the 101 ways to run a business, why is it that outsourcing features so often?
As a strategic move that’s been about since the dawn of business, outsourcing has continued to grow in popularity. So, why is it that employers often turn to third parties to unburden the day-to-day?
The HR outsourcing industry in particular has experienced solid growth, and in the year to come is set to rise by another 8.5%. With this in mind, the expert HR consultants at Growth Partners have provided us with a list of what they believe to be the 8 the biggest reasons UK businesses are opting to outsource the often-tricky area of HR.
- Lower costs
Often seen as one of the core advantages – outsourcing allows for businesses to save on expenses when it comes to labour and technical resources. Rather than have all the paperwork-heavy HR handled in-house – hiring various employees to carry out these individual tasks – the external firm, for a far lower fee, will already have trained staff to take on the burden.
- Expert insight
As mentioned above, the third-party firm is already specialised to deal with the assigned workload. This means that the business’s efficiency is likely to increase. The external firm will have within it a whole range of expertise, technical equipment, and objective insight which will serve to improve the quality, and the turnaround, of your day-to-day business operations.
- Reduced pressure
It may be easy to underestimate the number of boxes needing to be checked when it comes to a business’s regulatory compliance. By bringing on an expert team, the risk of failing to comply with, for example, all the different components within employment law or pension protocol, reduces the burden on the business who now has access to a higher quality of advice and support.
- Improved efficiency & innovation
With certain day-to-day duties being handled externally, the business’s flexibility is freed up. With the extra time, employers can now focus their energies on the core areas of their business that generate profit. Instead of the added expense of a chunk of the workforce being bogged down in the general, operational admin, the savings in cost (and time) can be allocated to areas which will aid the business’s personal growth.
- No Payroll worries
Payroll outsourcing has become a common approach used by businesses nowadays, and considering the benefits it brings, it comes as no surprise. In comparison to employing a member of staff to manage payroll in-house, the cost of outsourcing payroll to a third party is considerably less. A typical payroll or HR company will have specialists that will not only handle everything from pay slips to tax and deduction queries but will also be able to resolve any pay-related, issues your employees may face; some of which can be very time-consuming and awkward to deal with.
- Greater Risk Management
With the constant change to employment and labour laws, it’s not always easy to stay up to date with regulations that you and your employees must comply with. By outsourcing your HR to a third-party company, you can trust the employment law-savvy professionals to guide you to follow lawful practice; thus, reducing the risk of facing any costly and potentially reputation-damaging lawsuits. Moreover, if you do receive any claims, the HR pros will be able to use their knowledge and expertise to advise you on the best course of action.
- Small Staff Perks
Most HR firms provide perk packages which can serve as a big incentive for staff. Offering such benefits as health insurance, phone contracts, discount vouchers and freebies for food, social, and leisure activities can motivate your employees and increase their loyalty to your company – and it’s no extra cost for you. Remember, it’s the small things that can sometimes make the biggest difference!