October 29, 2020 | By Jason Randall
Outsourcing HR is a great way to grow your business and ease the HR burden for your in-house team. However, the amount of growth your business experiences will depend on the HR outsourcing solution you choose.
Recent studies have shown that working on your business with the right outsourcing company can lead to 7-9% faster growth than you would experience without outsourcing.
Outsourcing HR isn't intended to replace your in-house HR staff. Instead, the right partner can complement your employees by enabling them to redirect their focus on more important matters. In turn, both your outsourcing partner and in-house employees can work cohesively to grow your business.
The following are several ways outsourced HR can help your business excel.
Outsourcing HR relieves the administrative burdens on your in-house staff. Removing these enables business owners and their staff to spend more time and energy on core business. Subsequently, they have a chance to improve their growth and efficiency.
With outsourced HR, your HR teams will be able to redirect their focus toward revenue-generating tasks. In the process, outsourced partners can answer more complex questions about benefits and handle other HR tasks.
Fines and lawsuits arising from non-compliance issues can severely hinder your company's ability to grow. In many cases, companies may simply be uncertain regarding compliance, which alone can slow growth.
As a business begins to expand and increase in complexity, compliance becomes more challenging to maintain. For example, if your company gets to the point where it has over 49 employees, you will need to comply with the Affordable Care Act.
By outsourcing your HR, you will be able to more easily maintain compliance without worry. You and your staff will subsequently benefit from more peace of mind in knowing your company is consistently compliant.
Outsourced HR can also significantly lower turnover. According to a recent NAPEO study, outsourcing HR can reduce turnover by as much as 14% compared to businesses that neglect to outsource. If people are more satisfied with their benefits and other HR concerns, they're more likely to stay with your company as you grow.
Consider the burdens that come with high employee turnover: The frequent need to look for qualified candidates, devote time to onboarding, train new hires, integrate them with your teams, and familiarize them with your company's processes. It's also expensive, as the cost of employee turnover comes to around six to nine months' salary.
Outsourced HR can help reduce turnover and improve employee retention. As a result, you'll be able to spend less time hiring and onboarding. Meanwhile, your current employees will likely be more productive as they remain consistently content. This leads us to the next advantage.
With the help of reliable outsourced HR, employees will be more confident about HR. As a result, they'll be more likely to remain loyal. They're also more likely to maintain optimal performance as they stay engaged.
The NAPEO study referenced above also determined that employees have a higher intention to stay with businesses that partner with an HR outsourcing company. Employees who are willing to stay with you in the long term will also come to understand your business inside and out. This will enable them to maintain consistency across your operations. In the end, engaged employees that are happy to stay will keep contributing to your organization and will ultimately contribute to the overall growth of the company.
You can also save money with the help of outsourced HR. The amount you save will depend on which HR outsourcing solution you choose. Some solutions will help you save minimally, while others could help you reduce expenses in many different areas. This is why it's important to find the right partner for your business based on the benefits that are most important to your employees and the organization..
You're likely to save the most if you outsource to a professional employer organization (PEO). Specifically, PEOs help you cut down on HR costs by helping to select the best possible benefits package. A dependable PEO will be able to give you access to great plans at affordable rates..
If you want to appeal to the best possible job candidates when hiring, the key to attracting top talent is to offer a competitive benefits package. In addition to decent wages and a good work environment, employees consider strong benefit offerings a top priority. If you want your business to flourish, you need to have employees who can enable you to succeed.
It's not enough to hire employees who are merely qualified—having top talent behind your business could help you grow exponentially. Offering a highly competitive benefits package with the help of a PEO can mean the difference between attracting and deterring this talent.
All of these benefits make outsourced HR a potentially invaluable asset to your business. However, simply having an HR outsourcing solution won't help you experience the growth you want. Instead, consider working with an experienced and knowledgeable PEO to maximize your growth. With a dependable PEO by your side, you'll be able to save more money, attract top talent, maintain compliance, decrease turnover, and improve employee retention.