If you're planning to outsource your HR, don't rush to sign up with the first local PEO promising you hands-on, in-person service. It's a nice sentiment and a standard pitch. But the value of a PEO — of any size — lies in efficient HR management that drives your business forward. A national, certified PEO, leveraging virtual tools and economies of scale, has the resources to manage your HR more effectively than your local options, many of whom rely on regular in-person visits as a point of differentiation.
Alignment with your needs
In-person service is simply no longer necessary for the vast majority of HR tasks. You can ask your local PEO representative to be present when you onboard several new hires — and be billed extra for that visit. But electronic onboarding options, which have been in use for years, are more efficient.
Given the remote-work imperative of the pandemic, we see more and more businesses and organizations strongly associated with in-person service find that virtual services can, in many instances, be just as effective, and in some cases, more so.
Even though telehealth applications far predate the modern Internet era, there's been widespread resistance to the notion that your average consumer may receive the same level of care through a virtual visit rather than an in-person one.
Yet telehealth, we've seen, can be excellent for routine diagnoses, care, and treatment, as well as aspects of preoperative and postoperative care. A recent survey of more than a million patients found that they were likely to give their provider slightly higher satisfaction ratings after a telehealth visit than an in-person one. Patients praised the intimacy of the visits, as well as the convenience of scheduling. And providers doubtlessly benefited from the convenience of scheduling, as well as the reduced costs telehealth provides.
As with medicine, many HR processes are routinely done with virtual tools, such as payroll, benefits administration, and workers comp claims. And while you may have had a local PEO show up at various points during these processes, ask yourself whether their visit added value. If the rep was directing your staff to complete an online process anyway, then perhaps their visit was less an indicator of responsiveness and efficiency and more of an effort to retain your business.
Staff engagement that drives your priorities
Just because a PEO leverages virtual tools doesn't mean that the PEO-client relationship must be impersonal and transactional. The best PEOs manage HR in a manner consistent with your business and your priorities. And they can't do that without knowing you, your company, and the staff who make your business hum.
The best PEOs work to take the complexities of HR off your plate so that you can run your business. And while each business is unique, you also want a PEO that can bring insights from other organizations to you for your consideration. There may be a small business a few states over dealing with the same challenges you are from a productivity, culture, or HR standpoint. Those are valuable insights you're not going to get with a local PEO.
Economies of scale that add value
A national PEO will help you unlock the full potential of an increasingly remote workforce. Say you've got an excellent candidate you're looking to hire two states over. Your local PEO has no experience operating in that state. They don't know the ins and outs of hiring, healthcare plans, workman's comp, and other facets of employment law in that state. They likely can't get the same kind of healthcare pricing that a national PEO can. And so, you may be unable to bring that person on or absorb increased costs for doing so if you're working with a local PEO.
Not being able to bring on the human talent you need is a competitive disadvantage. Companies all over the country are taking advantage of the broader access to talent that remote work provides. You want to be able to hire that IT specialist across the country or that financial whiz down South to help your company innovate its product and processes. Your next hire could help you revolutionize your company. But if you're headquartered in a stagnant labor market, you shouldn't be limited by your local labor workforce.
A nationally represented PEO will have the resources to help you bring on board the staff you need across the country. You have enough tough choices to make, and whether to hire a talented employee because of payroll complexities shouldn't be one of them.
At the end of the day, there is no competition; the best PEOs have a national presence while bringing all the advantages of a local PEO without the unnecessary in-person visits.