A growing number of small to medium enterprises in South Africa are outsourcing their Human Resources functions as a means to streamline their business functions while cutting costs. The payroll and human resource management functions of an SME can take up as much as 40% of a professional’s day. Often these functions are performed by the business manager, or by department heads. Many companies find it is simply not feasible to have highly skilled professionals spend this much of their time on activities that are neither core business functions, nor revenue generating. Understandably, small business owners are becoming increasingly frustrated with the amount of time and money that is spent on human resource functions. By choosing to outsource their HR departments, businesses can realise a range of business benefits, helping them gain a competitive advantage.
Five benefits of HR outsourcing
- By outsourcing a company’s HR functions, businesses are able to relieve their managers of the administrative burden that comes with managing payroll, benefits, leave and compensation.
- Companies that outsource their HR functions are able to reduce costs. This is because HR consultants are often able to perform a company’s HR functions at a lower cost than is possible internally.
- By outsourcing HR functions, companies can also drive productivity by enabling skilled department heads and managers to get on with their business functions.
- Outsourcing human resource management also gives a company access to the expertise of an entire HR firm. For many SMEs, outsourcing their HR is the only way to gain expertise around legal and compliance HR issues, as well as best practices that ensure employee happiness.
- Because HR firms specialise at managing HR functions, businesses that outsource their HR and payroll functions are able to benefit from superior HR systems that rely on the latest technologies and are managed by HR experts.
Contact CRS to find out more about outsourcing your Human Resources functions and realise these benefits for your company.