assess your hr outsourcing strategy

Insourcing, Consulting or Outsourcing? It’s not a black and white decision. CEOs who would like learn more about HR outsourcing and investigate if it is the correct decision for the organization. Head of HR departments who are experiencing issues with limited resources, or experiencing pressure from the business unit, and is interested in exploring HR outsourcing (HRO) as a potential solution. Faced with the mandate to deliver strategic value while simultaneously cutting costs, HR outsourcing is a difficult decision. Make sure that you are outsourcing HR for the right reasons. The benefits must go beyond cost savings, and the outsourcing engagement must add value for the business in terms of gaining expertise, access and the ability to leverage technology, or the ability to be more strategic in-house. A study conducted by CIPD found that HR professionals view their current operating environment as turbulent and senior HR professionals are pressured to deliver strategic value. They most commonly cite the pressure to: - Enhance efficiencies (91%) - Enhance quality (85%) - Increase innovation (82%) There are 5 main goals for outsourcing HR functions: 1. Financial Savings – SHRM reports that 56% of respondents indicated that they engaged in HR outsourcing to save money. 2. Strategic Focus – Monica Belcourt found that companies that did outsource increased their strategic focus by 40%. 3. Improved Service - PWC reports that 75% of HR work hours are spent on transactional tasks. 4. Specialized Expertise 5. Organizational Efficiency – Tower Watson reports that 73% of respondents to a recent survey said eliminating administrative and transactional work is a primary goal of HR outsourcing. Use McLean and Company’s Options Analysis Tool to calculate and compare the costs of different sourcing options. The tool considers costs, risks, and benefits to assess the sourcing options. Consider the size of your organization and hidden costs when looking at outsourcing versus keeping the function in-house. In general, HR outsourcing providers fall under three categories: Multi-process HROs

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Page 1: Assess Your HR Outsourcing Strategy

Faced with the mandate to deliver strategic value while simultaneously cutting costs, HR outsourcing is a difficult decision. Make sure that you are outsourcing HR for the right reasons. The benefits must go beyond cost savings, and the outsourcing engagement must add value for the business in terms of gaining expertise, access and the ability to leverage technology, or the ability to be more strategic in-house.A study conducted by CIPD found that HR professionals view their current operating environment as turbulent and senior HR professionals are pressured to deliver strategic value. They most commonly cite the pressure to:- Enhance efficiencies (91%)- Enhance quality (85%)- Increase innovation (82%)

There are 5 main goals for outsourcing HR functions:1. Financial Savings – SHRM reports that 56% of respondents indicated that they engaged in HR outsourcing to save money.2. Strategic Focus – Monica Belcourt found that companies that did outsource increased their strategic focus by 40%.3. Improved Service - PWC reports that 75% of HR work hours are spent on transactional tasks.4. Specialized Expertise5. Organizational Efficiency – Tower Watson reports that 73% of respondents to a recent survey said eliminating administrative and

transactional work is a primary goal of HR outsourcing.

Use McLean and Company’s Options Analysis Tool to calculate and compare the costs of different sourcing options. The tool considers costs, risks, and benefits to assess the sourcing options. Consider the size of your organization and hidden costs when looking at outsourcing versus keeping the function in-house.

In general, HR outsourcing providers fall under three categories:Multi-process HROsPayroll and employee administrationNiche specialists Use the McLean & Company’s RFI and RFP Templates to help save time during the vendor selection process.