Every business has HR needs, from handling employee interests during operational growth to legal compliance and establishing internal policies. However, not every organisation needs to establish an HR team in-house. The human resources needs of a business could be met just as well by outsourcing this service, especially where the company is small to medium sized. So, how do you know whether an in-house or outsourced HR solution is the best one for you?
This is often a major factor in any business decision, especially when it comes to creating HR resources. An in-house HR team is always going to be the most costly, from the expense of the recruitment process to ongoing contractual commitments. If the business is large enough then this may be a cost that is fully justifiable but for most enterprises it could be excessive. This is where outsourcing HR needs can be a very smart business decision - rather than paying for a team on-site and on call all the time you can simply access the HR support that you require, as and when you need it.
The right in-House HR team can be enormously beneficial for a sizable company. HR can help to establish and develop the company culture, for example, and will give you insight and control over internal practices. However, it can be challenging to find the right HR team for your business especially if budgets are tight and the team is likely to be small. Many in-house HR professionals often find themselves looking outside the business to find consultant support for specific issues for which there is no expertise among the established in-house team. This can create challenging circumstances and mean that budgets soar. Outsourcing HR function often provides access to a much wider spectrum of expertise covering a range of issues, from recruitment through to complex disputes. It’s also much easier to find the right fit when you have more options to choose from.
An in-house HR team will regularly engage with employees from right across the business. While this does have its benefits in terms of coherence it can also create challenges that are particularly pertinent to a department like HR. Bias is one of these - if your HR team has a lot of contact with employees objectivity may be lost and bias can come into play. If you’re working with outsourced HR support there are still plenty of opportunities for your outsourced team to get to know the business but no danger of bias distorting the HR approach.
The obvious advantage of having an in-house team is that they are on-site and so access to HR support is easy to arrange. However, given the range of technology that exists to facilitate constant communication and access today this does not need to be the obstacle to HR outsourcing that it once was. In fact, in the era of remote working that we’re now in it’s much easier to see how outsourced services can be just as responsive and full as those offered in-house.
When it comes to the question of using HR that is outsourced or in-house there are some clear benefits to outsourced support that an in-house team can’t offer.
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