Topic Outsourcing HR / PEO

How to Unlock In-House HR’s True Potential

How to Unlock In-House HR’s True Potential

Many human resources departments feel trapped in a maze of administrative tasks instead of unlocking their true potential as strategic business partners. The key to escaping this maze is knowing which functions to outsource.  

By outsourcing key tasks strategically, HR can elevate its role as a true talent advisor and culture champion. This allows in-house HR to focus on more human resource management initiatives that align with overall HR strategy and plannning. The first step is taking an honest look at HR's current state and responsibilities. 

What is the current state of your HR? 

Your human resources professionals may feel stuck playing the role of compliance police and benefits administrator. They spend countless hours bogged down in mundane payroll management tasks, manually processing payroll, reconciling errors, and ensuring proper tax payments.  

HR staff pore over employee records, maintain meticulous files, and rigorously enforce compliance with various employment laws and regulations. While essential, these routine duties prevent HR from evolving beyond an administrative support function. They hamper efforts for HR to become true strategic business partners that have a seat at the executive table. 

The irony is that by letting go of some traditional responsibilities, HR can actually gain more strategic influence across the organization. The key is outsourcing certain administrative and transactional functions to specialized external partners. This liberates HR staff and unlocks time for more high-level talent initiatives that align with company goals. 

By partnering with a professional employer organization (PEO), HR can hand off high-volume tasks that require precision but little strategic input. Removing these burdens enables HR leaders to devote energy towards culture building, talent development, and other areas core to the people strategy. Outsourcing also grants access to technologies, economies of scale, and outside expertise difficult to match in-house. 

In essence, outsourcing administrative and compliance activities trades busywork for a bigger seat at the table. It allows HR to operate more intelligently and assume a role as a strategic advisor on par with other top executives.  

Now, let's explore specific ways outsourcing key areas provides this beneficial tradeoff for elevating HR's mission. 

How does outsourcing improve in-house HR departments? 

Here are some of the key ways that outsourcing administrative tasks unlocks HR's potential to be a strategic business partner: 

Focus on Organizational Development - With most of the recruitment process handled by an outsourced partner, HR leaders can devote more time to organizational development initiatives. This includes succession planning, career pathing, leadership pipelines, and other efforts to build bench strength. Outsourcing talent acquisition frees HR from being "super-recruiters" to being true talent advisors. 

Elevate Employee Engagement - Outsourced partners handling day-to-day HR call centers, helplines, and communications channels allow HR to focus on interpreting data and devising comprehensive engagement strategies. Instead of just administering surveys and fielding calls, HR can analyze results to recommend improvements to managers. 

Become Data-Driven Talent Managers - HR teams bogged down administrating LMS programs miss opportunities to leverage learning data strategically. Outsourced training partners administer programs, while internal L&D can mine data on skills gaps and build the capabilities most tied to strategic goals. This elevates their role as talent managers. 

Architect a Winning Culture - When outsourcers handle program administration, HR has time to interpret employee feedback and create action plans for improving company culture. No longer just running surveys, HR can meet with executives on removing engagement obstacles and refreshing culture elements. 

The overarching benefit is HR has time to operate as an advisor guiding the organization's people strategy based on data and workforce analytics. Outsourcing trades reactive tasks for a proactive role driving talent management, culture, and other elements core to realizing strategic goals through people. 

Which HR functions should you outsource? 

Here are some of the HR functions most primed for outsourcing: 

Payroll and Benefits Administration – Professional employer organizations can handle pay processing, tax filings, and compliance while taking on open enrollments, claim management, and other complex tasks. This frees in-house HR from these routine duties. 

Recruiting and Staffing – A PEO can fully manage the hiring process from sourcing and screening through interviews, offers, and onboarding new employees. This allows HR to focus on higher-level workforce planning. 

Training and Development - Outsourced learning partners can administer LMS platforms, handle regulatory compliance training, and free in-house L&D to create strategic programs tied to capability building. 

Engagement Surveys and Analytics - Third-party providers offer turnkey employee survey programs with robust analytics. This gives HR insights while saving them survey administration time. 

Background Checks and Drug Screening - Specialized screening companies can securely and efficiently conduct pre-employment verification and drug testing. This reduces risks and frees HR from a time-intensive process. 

The key is determining which specialized services provide strategic value over in-house handling. This allows HR to focus on high-level priorities with true business impact. 

What is the secret to success with HR outsourcing? 

Here are some keys to successfully implementing an outsourcing strategy that unlocks HR's full potential: 

Align with Business Goals - Outsourcing decisions should connect directly to strategic business objectives and enable HR to drive greater impact on those goals. Analyze how outsourcing certain tasks will free up time and resources to boost HR's strategic contributions. 

Clarify Roles and Responsibilities - Clearly delineate roles between outsourced partners and in-house HR for seamless hand-offs. Document who will handle what processes and deliverables to maximize efficiency and avoid duplication. 

Enable Open Communication - Create channels for regular communication between outsourced partners and in-house HR. Collaboration tools, recurring check-ins, and feedback loops lead to continuous improvements on both sides. 

Establish Performance Metrics - Use quantifiable metrics and service level agreements to evaluate outsourcing providers. Track progress towards strategic goals enabled by outsourcing. Analyze data to make adjustments. 

By laying strong foundations - from strategic alignment to open communications -- outsourcing allows HR to step into elevated strategic roles across the business. This leads to expanded influence and greater impact on overall performance. 

What is the future of HR outsourcing? 

With the right outsourcing partners in place, HR is no longer chained to administrative tasks. This elevates their role into proactive, strategic areas that truly impact business performance.  

As talent advisors, they can build a workforce to execute on strategy rather than just filling requisitions. 

As culture champions, they shape employee experience and drive engagement through data-backed interventions.  

As business partners, they use workforce analytics to advise on people investments that fuel growth and innovation. 

In the future, outsourcing may allow HR to drive automation initiatives, leverage AI, and pilot other emerging technologies to enhance their strategic capabilities. The possibilities for HR's evolution through outsourcing are as limitless as the human potential they look to unlock within your organization. 

How the Right HR Outsourcing Partner Brings you Closer to Your Dreams