Human resource is the collection of the talent that is present in the population of an organisation, company, industry, or even country. A narrower focus is human capital, that is, the human knowledge that the individuals embody. Similar but more specific terms are human capital, human resources or just staff. This term was first used by Tayloreter in his book The Wealth of Nations. In the modern sense, this concept covers the talent and potential of the employees as well as the organisations or businesses that employ these individuals.
The recruitment and the training of human resource professionals can be very expensive, especially for small businesses. Hiring a large number of temporary or part-time employees can increase the operational and personnel costs for the organisation. However, it may not be possible to recruit and train enough staff to meet the needs of your organisation, which leaves you with limited options – you could cut on some services that bring added value to your business or reduce your salaries and benefits package of your existing employees. Alternatively, your only choice would be to totally eliminate any employees, who are not worth the effort of looking for.
For many organisations and companies, the best option may be to outsource the Human Resource Department. Outsourcing the HR function allows you to concentrate on other core business functions such as marketing, administration, sales, project management, research and development, and general administration. In fact, many organisations find that by outsourcing the HR function, they are able to free up their valuable Human Resource department to focus on the many functions managers often delegate. By hiring an external Human Resource consultant, you not only allow the HR department to focus on their own tasks instead of being distracted with the HR management tasks, but also the consultants have access to many different support tools and resources that help them assess the overall health of the organisation and the skills of each and every employee. Thus, they are able to provide management with valuable information to improve the performance of their teams.
Many workers believe that the benefits of retaining the services of a Human Resource professional far outweigh the costs. The benefits of hiring a Human Resources specialist include: better benefits packages, better compensation and benefits package structures, better training opportunities and more opportunities for promotion. However, there are many other benefits to outsourcing your Human Resource functions such as the following: lessens your overall staff strength, eliminates administrative hassles, reduces health care costs, ensures the highest level of worker safety and productivity, minimizes employee turnover, and allows you to spend your money on core business activities. The benefits of retaining your Human Resource professionals are clear, however the cons of retaining Human Resource professionals are equally clear. Below are four common cons or bad practices that you should avoid when outsourcing your Human Resources functions.
The first common human resource outsourcing mistake that you should avoid is under-utilisation or excessive misuse of your HR human resources. Asking your Human Resources staff to perform functions that will reduce their value to your business is not only ineffective but can be detrimental to your business success. In addition, your HR employees may still be required to perform duties outside of their normal job scope. For example, if you have a pool cleaning job and an office cleaning job, you will still need to hire a groundskeeper, electrician, plumber and so forth to ensure the facilities in both jobs are kept in pristine condition. If you ask your Human Resources personnel to fill these additional positions, you will inevitably find that you have a larger than normal number of Human Resources personnel who are not maximized in their skills, experience and talents to help your business run as smoothly as possible. As a result, you may actually be wasting money by hiring unnecessary Human Resources employees.
The second key takeaways to remember about HR outsourcing is that there are numerous options and outsourcing companies that offer their services on the Internet. Therefore, you do not need to travel anywhere to receive the best Human resource management services. Also, by choosing to outsource your Human resource management functions, you will find that your Human resources department is freed up to focus on other core competencies within your company. By engaging in HR outsourcing, you can free your Human resources employees to deal with the day to day operations of your business while you focus on creating strategic plans to improve your workplace environment. Additionally, when you outsource your HR functions, you will find that the overall cost of the program is less than employing that same level of Human resources employees in-house. In fact, many studies have shown that the return on investment made by outsourcing Human resource management has been greater than the cost of employing those employees in-house.