The way people manage a business has changed over the past few years. Executives nowadays are being asked to do more with less, which is why many of them turn to HR outsourcing services. Outsourcing human resources can sometimes provide a solution to some of the skill-related and staffing problems that many small and budget-strapped companies face.
For many of these organizations, staffing an HR department with full-time employees with the necessary skill and experience can be difficult. As a result, the HR departments of these companies can suffer from a lack of good employees or a gap in critical skills.
In reality, some of these companies don’t need to hire a full-time employee to address their pressing HR needs or to fill a skill gap. Instead, what they need is the services from an external provider. HR outsourcing services allow these companies to focus on their core tasks while entrusting human resource functions to professionals that can devote the right amount of time and expertise necessary for each organization.
What is HR?
Before you decide why you should outsource HR, you should first learn what human resources is. HR, in a nutshell, is concerned with human beings in an organization. “The management of man” is an important, yet challenging job because of people and their dynamic nature.
No two people are the same in terms of behavior, sentiment, and mental ability because they can differ widely as a group and are subject to many different influences. People cannot be altered and shifted like a template in a room layout or operated like machines because they think, feel, and are responsive.
HR is the process of managing the people of a company or business using a human approach. The approach to manpower in human resources allows managers to view their employees as important resources. This allows organizations to use their manpower not only to provide benefits for the company, but also for the development, self-satisfaction, and growth of the people themselves. Essentially, HR is the system that focuses on employee development on one hand and effective and dignified management of people on another.
Human resources are also concerned with providing employees with human dignity. They into account their talents, potential, achievements, motivation, commitment, skill, abilities, and personalities, recognizing them as valuable human beings. If a company can trust and depend on the strength of its capital assets by drawing into its bank account, it can also trust and depend on its people by drawing on their commitment, talent, dedication, and capability.
Because many of the problems in an organizational setting are human and social rather than technical, physical, or economic failure, human resources play an important role in the success of any company. As Oliver Sheldent puts it, “No industry can be rendered efficient so long as the basic fact remains unrecognized that it is principally human.
Human Resources Defined
Human resources can be defined in two different ways. The first definition of HR is the process of managing people in organizations in a thorough and structured manner. This includes the fields of staffing or hiring people, performance management, pay and perks setting management, change management, retention of people, and taking care of exits from the company. This is how HR is traditionally defined; it is simply a modern version of the Personnel Management function that came before it.
The second definition of HR is the management of people in organizations from a macro perspective. In other words, managing people in the form of a harmonious relationship between management and employees. This approach is focused on the outcome and objectives of human resource functions. It means that the HR function in modern organizations includes enabling people, developing people, and making the employment relationship fulfilling for both management and employees.
To summarize, human resource is a management function that helps a manager to recruit, select, train, and develop the members of his or her organization. HR is the process of making effective and efficient use of human resources so that the goals set by the company can be achieved.
Why Outsource HR?
Organizations that choose HR outsourcing services choose to do so for many different reasons. Some of these situations and the reasons for them include:
- Some companies only hire essential staff. They have outsourced all administrative functions such as accounting, technology support, and of course, HR.
- Their HR needs have outgrown the expertise of their current HR staff.
- Their HR department has experienced a huge turnover and they do not have the time or resources to create the kind of internal HR department that they need.
- Their director/controller of finance or CFO is now consumed by accounting and finance functions so he or she no longer has the time to devote to HR tasks.
- They no longer have the financial resources for full-time staff members devoted to HR responsibilities.
But perhaps the main reason why organizations choose HR outsourcing services is that they need to comply with employment laws and regulations; even small organizations can face a hefty fine if they fail to abide by these laws. The employment regulations and laws can be even more difficult for organizations that have multiple employees all over the world because these regulations can vary from p