HR process management is one of the finest and sensitive components of any organization. Indeed an organization cannot function in the right way if there is any disturbance in at least one of the processes involved in HR process. Now, first of all let’s understand about the various functions involved in a HR process.

First of all, getting the right resource for the right job at the right time, coined as recruitment, is the prime priority of any HR process. Next in the chain is to train the resource with regard to organization’s expectations and goals to meet. This is also a very vital function in the HR process because if the resource is not aware of what he has to do, it hits the productivity badly. After these two stages managing the administration related activities for the resources is a major component of the HR process. These activities include time and attendance tracking, payroll management and related functions.

Many organizations take care of all the aforesaid functions in-house. There is a dedicated person to handle these activities. In larger organizations, there is a team to handle the HR process and related functions. This person/team gets set of resume related to the required skill set for the role, interviews people, filters candidates based on their expertise to match the requirements, makes the background checks, recruits right professionals for the right job and trains this person with the help and support of functional experts. As an ongoing process, administrative functions of the HR happens month on month. The payroll process happens in-house with the help of spreadsheets or software to provide data. There are many ways in which the data is being gathered for payroll computation. Firstly, the attendance data is vital for any payroll calculation. This data is arrived by using punch cards, swipe cards, and biometric systems. The data is gathered in form of a spreadsheet and mapped with the respective employee for payroll processing.

Now that we have understood how HR processes are handled in-house, we need to analyze the merits and demerits of this. Some advantages include:

  • Since HR processes are very sensitive and prone to many risks, a good level of control exists when these processes are handled in-house.
  • Another advantage is that you can change data as per the requirement even in cases of urgencies.

Some disadvantages of handling HR processes in-house include:

  • Time Consuming
  • Involves multiple costs
  • Prone to security issues
  • Prone to compliance and regulatory issues

When cost is a factor of disadvantage, then organizations need to start exploring other options to overcome these and get into a comfort level. Human resource management outsourcing is an emerging trend where organizations tend to outsource vital HR functions such as recruitment, training, time and attendance tracking and monitoring, payroll processing, compliance and related activities. The advantages are just the reverse of the disadvantages of in-house HR management.

First thing, you tend to save time and money by outsourcing your HR processes of your organization. You need to just invest time to review your service provider’s performance in regular intervals and check whether everything is in place. This can happen only if you identify an efficient and affordable service provider for your business needs.

The next great advantage that HR outsourcing has is that the security and risk factors can be handled easily with a cloud based payroll option where you have the complete control of what is happening in the process.

Yet another advantage is that you can get rid of compliance related issues. This is only because of the reason that your service provider will have the expertise and experience in the domain with all the latest updates regarding compliance and government taxes.

Stella Lauren has made this useful contribution to help organizations grow with the technology advancements and best practices such as opting to outsource HR processes and using for their functions. Register for ADP Live Webinar at: ADP India live Webinars

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October 2020