Is Outsourcing HR the New Normal?


Long before the 2020 pandemic began to unfold, businesses of all types were looking for ways to optimise resources. Leaders and innovators were imagining new ways to organise their workforce and navigate the human resources landscape. Discussions around company culture, remote work, and flexible hours were developing at a fast pace.

Co-working spaces are a good example. They began as a place for freelancers to set up shop away from home, but their flexibility and networking perks attracted the attention of the corporate world. Even the likes of Microsoft and IBM have rented co-working space for their personnel. The goal? To be in close proximity to pipelines of innovation and talent.

The coronavirus pandemic has only accelerated questions around company culture and the workforce of the future.

What will HR departments look like in the 2020s and beyond? What functions are essential? Will more in-house capabilities be built, or will outsourcing play a bigger role?

Tailored solutions to meet a spectrum of needs

The case for outsourcing HR differs between organisations. Some company cultures thrive with a stronger internal team. Others could meet their needs more strategically – and more economically – with help from outside. In which case, what does good service look like?

HR service providers might utilise similar principles in certain areas of practice, but the importance of customisation cannot be emphasised enough. A formulaic, “one-size-fits-all” solution simply won’t work. Outsourced HR solutions should be based on a clear-eyed understanding of the organisation, its culture, its people and its unique place in the market. This is where the value of senior, experienced support comes into play.

If an organisation can afford to acquire and retain top talent in the HR department, the value will be evident. But for those who need a more efficient way forward (SMEs are a prime example), a tailor-made solution from an experienced HR partner can take a number of different shapes.

People

  • Sourcing, attracting, developing and retaining top talent

  • Building the talent pipeline

  • Coaching line managers

  • Supporting and mentoring less experienced HR staff

  • Expert coaching for CEO/MD

  • Communicating, communicating, communicating!

  • Facilitating and building teams

Advice

  • Providing contemporary HR/ER/IR advice

  • Assessing and analysing internal talent pools

  • Advice on remuneration including bonus programs

  • Advice on recruitment

  • Succession planning

Strategy

  • Developing HR strategies that support the business plan

  • Planning and executing recruitment and redundancy programs

  • Bringing HR policies into alignment with contemporary business culture

  • Implementing performance feedback systems

  • Improving L&D strategies

  • Developing new strategies for team building

  • Implementing new communication plans

Events

  • Managing company team events

  • Managing end of year/new year launches and reviews

This is, of course, an incomplete list of outsourceable HR functions – but it shows how detailed and customised an effective partnering process should be.

An HR service provider should function much like a part of your business, but with the backing of a wider team and specialised resources.

It should offer a range of cost options (e.g. a monthly retainer with reduced partner fees on all service, or monthly blocks of hours to be used according to the need) in order to fully deliver on cost savings.

The value proposition of professional HR services

Outsourced HR – when done right – allows SMEs without an internal HR specialist to obtain senior support for less than a mid-tier permanent hire. It can be a full or partial service, and is tailored to the need and budget. It provides access to a team of generalists and specialists, all within the cost. It helps manage the day-to-day whilst preparing the company for future needs.

As workforce dynamics continue to evolve, HRM will remain at the core of success. For many organisations, professional HR service is a sensible, contemporary, and effective way to strengthen that core as we find a new normal in professional life.

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