An increasing number of organisations are utilising outsourcing solutions to help their business processes become more efficient. The Deloitte 2012 Global Outsourcing and Insourcing Survey Executive Summary, revealed that 60% of respondents said that outsourcing at least some workplace processes was a standard practice at their organisation.
In terms of HR, where some work can be repetitive, organisations are looking to HR-specific outsourcing solutions (HRO) to help their in-house HR teams concentrate on more strategic goals. Olivia Yeoh, Director, PayrollServe, says that HR outsourcing companies are experts in the combined fields of HR, employment laws, and taxation. Outsourcing to an organisation like this allows in-house HR resources to be better utilised, she says.
“If any organisation desires to grow and excel in today’s highly pressured and turbulent world, there must be a shift in management thinking about how best to deploy its limited and valuable HR resources,” says Yeoh.
“Outsourcing becomes an attractive integral approach as it allows an organisation to build what matters most to them and leave the other areas to an outsource partner. It also enables an organisation to systematically build its HR infrastructure without committing to huge overheads and capital investments,” explains Aileen Ng, Managing Director, Virtual HR.
Sharing the HR load
Payroll is a major function in any organisation and many HRO providers can help with this vital business process. Yeoh, of PayrollServe, says organisations that have outsourced their payroll do so for the sake of expediency, accuracy, timeliness, control and confidentiality.
“The benefits of payroll outsourcing far outweigh the cost. Organisations can possibly reduce or save overheads associated with employing a dedicated payroll specialist in-house,” she explains.
PayrollServe provides payroll and HRO services to a range of organisations. For clients who are adept in managing on their own, the organisation licenses its online systems to serve their needs. “These clients use the same systems that we use internally to support our outsourcing clients,” she says.
One of the major issues that outsourcing organisations face is the accuracy and confidentiality of sensitive business material. HRO providers say that organisations do not need to worry about privacy risks. Yeoh explains that “contrary to common beliefs, organisations do not necessarily need to give up the confidentiality and control of their payroll process when they outsource.”
Besides payroll, organisations are also turning to outsourcing specialists with regards to employment contracts. Virtual HR specialises in employment compliance and managing activities within an employee’s typical life cycle with the client organisation, says Ng.
This work includes developing the terms and conditions of employment at the on-boarding stage, managing employment contracts, processing employee payroll, leave, time and attendance, and benefits, as well as managing the exit process, she adds.
Ng says that in terms of cost savings, organisations can save 30% or more. However, she adds that outsourcing should not be just about cost savings for companies. “The days of looking at outsourcing solely to derive cost savings are over. Resource optimisation, coupled with the agility to move quickly with business demands, are the quantified benefits these days.”
Experts say it is essential that the needs and priorities of the organisation and the service provider align with each other. Ng says there are risks in utilising HRO solutions, and this largely stems from not selecting an outsource partner who aligns with the needs and critical elements.
The Deloitte 2012 outsourcing survey showed that some factors led to dissatisfaction with HRO providers – vendor underestimating scope or effort (52% or respondents cited this issue), lack of service level attainment (48%), sub-par vendor performances (38%) and lack of timely project and service request execution (29%).
Recruiting from the outside
Getting good talent is critical for any business and organisations are stepping up efforts in the ways that they recruit. They are also turning to staffing solutions firms to help them to streamline their recruitment processes.
Recruitment process outsourcing (RPO) solutions company, Resource Solutions offers its expertise to organisations looking to attain good talent. Simon Bradberry, Managing Director, Asia-Pacific, Resource Solutions, says that an RPO provider needs to deliver on several areas. “Five key benefits lie at the heart of what a good RPO provider can deliver: cost savings, reduction in risk, increased flexibility, faster speed-to-hire, and delivering higher quality service and candidates.
“Each client will have different priorities or buying criteria and the benefits of using an RPO provider is that these priorities will be weighted according to the organisation’s needs,” he says.
He adds that organisations should consider additional benefits from an ROP provider, such as the ability to provide benchmarking and market intelligence in addition to other “value adds”.
Resource Solutions ensures that its staff are based in their clients’ offices to cater to their clients’ needs. “We believe the benefits of having an embedded team far outweigh any additional upfront costs as we are able to connect to clients and candidates more effectively and ensure the right candidates are sourced for the right roles, which in turn reduces costs down the line,” explains Bradberry.
The indomitable rise of social media has also given another space for organisations and recruitment firms to find talent. Though Bradberry says the usage of social media makes it easier for a client to outsource as well as engage with candidates directly, he cautions that it is still not the most effective method of candidate attraction.
In a 2012 survey focused on recruitment agencies in Singapore, Hong Kong and Malaysia, Resource Solutions found referrals were the most effective sourcing method for candidates, while social media ranked sixth out of seven recruitment strategies.
Bradberry says that social networks should be part of an integrated recruitment strategy and they should be assessed for their effectiveness. “One mechanism to establish the most effective use is to conduct social media listening audits, something that Resource Solutions has delivered for a number of our clients. It helps them to assess whether social media is right for them and, if so, which channels are the most appropriate.”
In a survey by Resource Solutions, companies gave an idea of their priorities when it comes to getting talent in the next 12 months.
Top priorities of recruitment over the next 12 months
• Improve the quality of candidates attracted
• Improve the quality of service delivered to hiring managers
• Improve the quality of candidate experience
• Reduce time to hire
• Cost savings
• Adherence to global processes
• Reduce the business’s exposure to risk in engaging temporary or contingent workers
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