Outsourcing is NOT a 4 Letter Word!

The truth is that all companies need HR.  But not all companies need the same type or same amount of HR.  The laws are in place for all, so compliance is an issue across the board.  At some point, all companies will need to hire.  Some may do it once a day, others maybe once a year – but it’s still recruitment no matter how you slice it.  Every organization at some point will deal with employee relations issues – big or small, they exist.  So how can HR be scaled to provide that perfect fit for every company?  The answer is outsourcing.

Ahhhhhh!  No, you just said that horrible word!  How dare you? 

Ok, hang on – let me give this some perspective.  For a while now, the term ‘outsourcing’ has meant the kiss of death for HR professionals.  Outsourcing = jobs lost.  Sometimes that is the case, especially in the event of a restructuring, a sale, or business need to cut costs.  But that’s not the outsourcing I’m talking about. 

I have spent the majority of my HR career in outsourcing and I love it.  The companies I’ve worked for have focused on providing HR services to small and mid-sized businesses.  And when I say ‘small business’ I mean ‘small’ – in some cases just 1 or 2 employees in the company.  (I love when articles, new stories, or presentations mention small business and quantify that as 500 employees or less.  I’m here to tell you there is a huge difference between a 500-employee company and the 5-employee plumbing company I work with.)  Shouldn’t those small companies have HR too?  Don’t they have to maintain the same level of compliance as the big boys?  From a financial perspective, it would be impossible for these small companies to hire an employee dedicated to HR.  They don’t have that luxury – all available cash and resources have to go toward payroll and running operations.  But through outsourcing options, small companies can ensure compliance and get the assistance they need in a manner that works for them. 

Outsourcing is not only good for small and mid-size business – it’s good for HR professionals too.  I was fortunate to start my HR career in outsourcing; I learned more in a shorter period of time than I ever would have in a traditional stand-alone organization.  One day I’m working with a manufacturing company on its benefits open enrollment; the next it’s assisting a physician practice with their employee handbook.  I’ve essentially worked with every type of industry – what a world of HR exposure!  It has shaped the professional I’ve become today.  I have seen others grow into fantastic HR practitioners by working in outsourcing – you can’t beat the experience.  To be fair, I have worked in large (5000-7000 employees) companies and I have found their HR departments to not be quite up to par with the teams I’ve worked with in outsourcing.  Variety can be a wonderful tool to enhance an HR career. 

While at the SHRM19 conference in Las Vegas, I was fortunate to hear Martha Stewart speak on her experiences in business and life.  I found her to be insightful and a strong businesswoman with a rock-solid work ethic.  During her session, she mentioned that the ownership company over her organization outsources their HR function.  I could feel the collective silent gasp in the audience!  There was definitely a tingle in the air after she made that statement.  Given the traditional thoughts behind outsourcing, it’s no surprise – I would assume a company as large as Martha Stewart’s would have its own HR department too.  But I have to say I was pleased, and I would bet the folks serving as the outsourced HR practitioners for Martha Stewart’s organization are outstanding. 

#SHRM19 #LivingintheGray #HRTribe #HRonPurpose #HRRising #HRoutsourcing

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