Do you remember when you first decided to start a small business. The vision was clear and the excitement drove us from imagination to plan to reality. But, before we knew it, we went from happily wading in the waters of our areas of expertise into the deep and sometimes turbulent waves of the unknown; Human Resources. Human Resource functions include: Payroll, Employment Tax, Recruitment, Hiring, Employee Relations, Termination, Regulatory Compliance and Training to name a few. Each of these functions demanded specific skill sets and experience. They also began to expend valuable time and resources.
The reality is that when reviewing a successful business plan there are two major areas to consider; Revenue streams and cost centers.
…show more content…
It is definitely money well spent. Be wary of firms that will provide you with free audits since you usually get what you pay for. The audit results should tell you exactly where you stand and specifically provide a HR roadmap to get and keep you on track. Next, ask the most important question: Do YOU have the expertise, time and interest to actually focus on those areas and do them well? Finally, consider the risks and rewards of alternative Human Resource solutions.
After twenty five years of providing human resource solutions to hundreds of companies from small start ups to fortune 100 companies, my advice to many of those firms, especially small and start up businesses is to maximize their resources by at least partially outsourcing Human Resources. By outsourcing HR, companies get to focus on what they do best and avoid the hassles and dangers of managing potentially high risk areas.
Remember, as an entrepreneur you want to maximize productivity, increase revenue and control costs. Outsourcing Human Resources and other administrative tasks allow management and staff to focus on core business functions. Most importantly, companies receive high end HR services for less than the cost of an administrative staff position.
MINIMIZING RISK
A critical component of any small business plan is minimizing risk. When reviewing potential Risk Management issues consider this; Regulatory Non-compliance and Discriminatory practices make up the majority
The role of a Human Resource department is ever changing in today’s volatile business environment. Over the years HR have become strong strategic partners within an organization by providing functions such as recruitment,
The role of a Human Resource department is ever changing in today’s volatile business environment. Over the years HR have become strong strategic partners within an
The human-resources department is responsible for performing HR management. This includes overseeing numerous aspects of employment, such as compliance with labor laws, employee benefits, recruitment and retention just to name a few. According to APHSA (2016), there are four primary functions for which HR is responsible: Executing HR Administrative Functions; Developing Talent; Influencing Culture; and Influencing Direction. By executing HR admin functions the department; builds trust with administration, engages leadership in the development of jobs, recruits, hires, and assist with onboarding new employees. HR develops talent by creating employee development and training opportunities for increased performance as an organization. In utilizing this skill, it can create opportunities for leadership and promotions.
Human resources involves workers who are in charge of the organization and responsible for implementing strategies and policies that relate to the management of individuals. It is a very important part of a company’s success and ultimately decides how much the company can grow and achieve (Vasquez, 2003). Human resource managers seek to achieve this success by arranging the supply
Due to the price of goods and cheap labor costs. Owing to the fact that if the cost of labor is high, the product has to be high which may cause the business to shut down. Outsourcing is a mischievous practice for the job market. While some good benefits can come from it, the ethical, legal, and business issues for the company's, employees, customers, and other external stakeholders outweighs them. For businesses that are small or big, there are both pros and cons to outsourcing HR functions.
The HR office can be viewed as the heart of the organization and is in charge of a large portion of the important capacities in a partnership. It is responsible for the capacities that permit the organization to address the issues of the administration and staff. Outsourcing is turning out to be more basic to organizations that are attempting to lessen their costs, the topic of it aiding or harming the organization is a begging to be proven wrong theme. Thomas Stewart and Keith Hammonds are adversely incredulous of the human asset division in the article "Determination: Close Down the Human Resource Department". Despite the fact that their sentiment is regarded, a great human asset office can positively affect an organization.
Human resources is considered key within the business, job roles consisting of recruiting employees so that the business can function and operative payments and other employee procedures. Therefor without these imperative duties businesses would have difficulties creating a respectable operational environment for the employees. In addition human resources is key for businesses to acquire results so that the company is always moving forward within different markets “human resources is accountable for a number of key results areas and management competencies” (John H. McConnell, 2011)
As companies look for ways to strategically perform better in their respective industries many chose to outsource job functions. Outsourcing allows companies to grow and expand their business around the world. Many have attributed outsourcing to lowering operating costs, a method to increase expertise and gain additional technology, and as a way to improve efficiency and services. These advantages can help a company gain a competitive advantage over industry participants. When a company strategically plans to outsource ethical consideration must be acknowledged; especially when outsourcing is offshore.
There are several important reasons of human resource planning that business organisation carry out regardless their size and it is important for the continuity of any business organisation to plan. However, in many business owners may not include human resource planning at the beginning of their business but later realise the importance of human capital and no business can survive without having competitive human capital.
Outsourcing is a cost saving method that companies employ by utilizing less labor and overhead in house. Instead companies pay much less to an outside firm to handle some of the duties that are more menial in nature, but important enough for management to consider necessary. To that end, just about any task can be outsourced, including the Human Resources Department. Through the use of Human Resources outsourcing firms save money on things such as: benefits administration, total absence management, defined benefits, 401k, etc. There are firms who outsource the entire
Whether an organization consists of five or 25,000 employees, human resources management is vital to the success of the organization. HR is important to all managers because it provides managers with the resources – the employees – necessary to produce the work for the managers and the organization. Beyond this role, HR is capable of becoming a strong strategic partner when it comes to “establishing the overall direction and objectives of key areas of human resource management in order to ensure that they not only are consistent with but also support the achievement of business goals.” (Massey, 1994, p. 27)
In this era where the world is globally evolving, due to the nature of the roles, functions and responsibilities on HR in organizations, it outsources some of its organizational activities to line managers to carry out. Although, this form of practice does not involve training, hence I will say it is quite cheap for organizations to carry out because it relieves itself from some duties but it tend to limit the capabilities of the HR practitioners in organizations i.e. instead of adopting the need to in-source, they outsource. This practice has helped in relieving HR department in organizations from heavy workloads overtime (Armstrong 2009). Human resource activities such as recruitment and selection, workers’ payroll, learning and development just to mention a few are now very much outsourced to consulting organizations to carry out and bear whatever risks involved (Taylor 2008).
Handling a variety of HR activities besides the core activity by employers would not bring useful consequences for organisations. Thus, by outsourcing, they can concentrate on their core competence which might be included in the application of various policies in different businesses. For instance, as stated by Belcourt (2006) designing products is one of the major activities in NIKE. Contracting out non-core HR tasks provides free time for managers to pay more attention and attempt to the value added activities such as leadership development, innovation and customer services. Hence, diminution of HR administrative duties like employees’ pension, benefits and payroll helps mangers to be strategists to improve companies’ competitive advantages.
The operating environment of enterprise are significantly changing with technology revolution and economic globalization. In order to overcome some indefinite factors of environment and remain competitive benefits, the human resources outsourcing management is facing a tremendous challenge. Human resources outsourcing (HR Outsourcing) one kind of choice provide by human resource service working mode. It is a HR service mode that offer variety human source management outsourcing to third party provider which can improve efficiency, save costs and win the competitive advantages of strategic management of HR.
This paper discusses three questions - Firstly it identifies and explains three important HRM skills. Secondly, it Discuss some major challenges companies could face when confronted with a merger and acquisition strategy. And lastly it discusses how businesses could minimise the challenges and risks of outsourcing their non-core business activities to external providers.