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Experts Weigh in on How HR Can Be Done Right

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Apr 16th 2015
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Human resources professionals have a lot riding on their shoulders – from recruiting and hiring/termination to benefits and special programs. What’s more, every CEO and CFO struggles with whether or not to outsource that work, keep it in-house, or do both.

Here, three veteran HR professionals offer some sage advice.

At Robert Half in Westlake Village, California, Senior Executive Director Paul McDonald believes in both approaches.

“If you don’t have expertise in a subject matter in an area within the organization, going to find it outside is necessary,” he says. “Go hire the subject expert.”

A small HR department that deals with typical employee issues of benefits, termination, and the hiring process, for example, may want outside assistance in selecting the right healthcare plan for employees, McDonald says.

Where in-house HR departments are especially helpful is frequent and clear communication with employees about all company programs – whether that’s through paper or electronic newsletters or screen pop-ups.

“Frequency and clarity of message really win the day,” he says. “Companies that lose people regularly or that have low employee morale have poor communication within the organization.”

The same applies for HR staffers and how the CEO or CFO communicates with them, as well, particularly if an outside HR firm will be handling certain programs.

“Transparency is vital,” says Hang Bower, former chief HR officer with accounting firm BDO USA LLP and now vice president and managing director of hrQ Inc. in Denver.

“You have to understand what you have internally [in HR staff],” she continues. “Be careful about what you already have or you could alienate your internal staff.” That’s why communicating with them about why the firm will outsource a particular function is key.

At BDO, the firm outsourced work on special programs, such as its women’s initiative, diversity, and workplace flexibility programs, Bower says.

“Outside consultants have exposure to specialized areas daily – they’ve seen it 100 times while internally you might see it once,” she says.

And when it comes time for audits, the outside consultant is seen as more neutral and independent, Bower adds.

Whether outside vendors are more expensive is a wild card. Startup companies tend to use outside HR while established firms may not.

“You have to look at your budget, the cost of having a staffer do it (including benefits and taxes), and the particular project,” Bower says. “Sometimes going outside saves money.”

Ultimately, how to handle HR must align with a company’s strategic goals, says Aldor Delp, vice president and general manager of the HR Solutions Group in the Small Business Services Division at ADP, a human capital management firm.

ADP’s customers can rely on its HR experts and focus instead on growing their business, Delp says. For example, a designated HR employee in a small business may find constant changes in regulations, laws, and tax codes daunting.

“ADP has a team of professionals dedicated to making sure changes in regulations that affect HR, tax, and related compliance areas, both at the state and federal level, are integrated into our products, solutions, and services,” Delp says.

HR choices boil down to company goals, budget, overall staff size, HR needs (including special programs such as BDO’s) and the HR staff’s experience level. And of course, transparency and communication.

Related article:

The Top 6 HR Blunders – and What Small Businesses Can Do to Avoid Them

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