Key trends in HR outsourcing

October 27, 2011: Over the last decades the approach to issues related to staffing has changed considerably. Employees play a major role in the success of any organization. It is found that efficiency, motivation and creativity of the employees are the important factors that give any organization a competitive edge over others. This helps the organizations in enhancing the value provided by them to the customers.

In every organization HR issues are part of general organizational management system and it is closely interrelated with other managerial functions such as goal setting, planning etc.

The most important issue that most of the HR managers face is the decision: which HR function to perform in house and which function to outsource. The recent trend in many organizations is that the payroll which is an HR function is being outsourced. Function such as personnel development is performed in house as it is based on the strategy and cultural profile of the company.

The other functions of HR which are being currently outsourced are:

1)      Recruitment

Professional recruitment providers perform extensive market research to understand the trends in the labor market. Such in depth analysis will help in understanding the expectations and limitations of the prospective employees. Outsourcing recruitment activities to professional agencies will help organizations to limit the time and effort required by them to perform the function in house. It will also help in reducing the expenses in carrying out the recruitment process.

2)      Personnel development

The main objective of personnel development is improving the performance of the employees so that their performance meets the requirements of the organization. Assessment of performance of the employees has become important as the organizations are becoming more competitive. Professional providers of personnel assessment providers will help organizations in determining the skills and talents so that proper development can attain by giving training to the employees.

3)      Managing HR Record and processing of payroll

In most of the countries there are laws which require the company to maintain documents that record relationship between employees and employer. The organizations require considerable number of employees who are specialized in record keeping to perform this in house which increases the cost and effort from the part of the organization. Outsourcing this function will help the organizations in reducing the cost and effort required by the HR specialists.

Payroll processing will also consume resources in terms of manpower, time and money. Outsourcing this function will help organizations in reducing the cost and effort.

HR issues should be taken into consideration by the organizations taking into account that it should focus attention on the clients. Outsourcing can be good solution for this which will reduce the expenses and will let the organization to focus on core issues related to clients. 

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