At many companies, an HR administrator or manager can be responsible for payroll, recruiting, onboarding, hiring, performance reviews, employee engagement, and more. Having an HR expert on staff who has extensive experience in each area can be tough to find. Even if you do find someone, the ever-changing rules, regulations, and laws can be a full-time job, especially when the average employee to HR personnel ratio is 1.4:100.1 In today’s post, we explore hybrid HR solutions, and how they can help to build an all-encompassing HR program that can set your business up for overall success.
We’ve included insights from Mammoth HR, a Collaborative HR company who combines the best of HR consulting and HR technology to help organizations reduce risk and drive long-term success. They’re a long-time Ease Marketplace partner.
Outsourcing Isn’t The Answer
Completely outsourcing HR to replace an in-house HR team may seem like an attractive option. Unfortunately, it does not truly eliminate the need for an HR staff and can pose a series of problems in the long-run.
According to Mammoth HR, an outsourced approach is typically project-based — adept at managing specific HR functions but not focused on improving those processes or empowering an organization to eventually become more self-sustaining:
“While outsourcing may be suitable for some less complex areas of HR, the strategy is ineffective when it comes to larger initiatives like developing a best-in-class employee engagement program, building strategies around hiring and retention, creating an award-winning company culture, or simply getting quick, reliable answers to HR questions.”
In the immediate future, outsourcing HR can eliminate a couple salaries and take tasks off your list. The cost of outsourcing HR will not remain low for long. Because you rely on an external agency to manage all of your HR functions from beginning to end, including payroll and onboarding, the fees will increase as your company grows and adds more employees. Creating a strategy for performance management for 25 employees isn’t the same as it is for 100 employees.
Outsourcing could inadvertently increase employee turnover rates by not providing an outlet for employees to voice their concerns and suggestions. For example, there will be no in-house HR team relaying employee benefit preferences to your health insurance broker. If several employees want for HSAs or telemedicine plans, there will be no one to collect that intel. Employees could then leave for another company where the benefit options are better suited to their needs.
Outsourcing HR can also create an impersonal company culture. An outsourced HR team is not able to provide employees with tailored support or guidance with internal conflicts. By just having an in-house HR team, you automatically display that you value your employees, care about developing their skills and expertise, and are committed to leveraging both the employee and company’s growth.2
A New Approach: Hybrid HR Solutions
If both outsourcing HR and just having an in-house HR team fall short, what’s the solution? A hybrid of partnerships and in-house staff, also known as hybrid HR solutions.
Simply put, hybrid HR solutions bring the assistance and expertise an in-house HR team needs to build a successful HR program that will contribute to the overall success of a company.
These partnerships or hybrid HR solutions help you quickly find solutions to your HR problems, and act as a type of trusted advisor to help you tackle your larger HR initiatives. As opposed to outsourcing, there’s flexibility and ownership in how you manage these initiatives. For example, if you are looking to streamline the interviewing process across your company, you can pair your knowledge of the hiring managers’ preferences with the strategies suggested by your HR partner. The combination of your insights with your HR partners’ expertise sets up a better solution than purely outsourcing the process to someone who doesn’t know about your business.
As the HR landscape continues to evolve, Mammoth HR told us that organizations are seeking a more collaborative relationship with outside HR vendors to serve as a critical extension of their teams, and ultimately enhance their in-house HR capabilities. Mammoth HR explains this concept as Collaborative HR:
“Collaborative HR is enhancing the capabilities of the in-house HR team. When we partner with an organization, we aim to empower their team to confidently tackle the HR challenges that come their way. The goal is to build lasting, positive HR outcomes for their organizations. In order to do that, we develop a deep understanding of the organization and its goals, and we’re invested in its long-term success.”
To illustrate, Mammoth HR recommended we look at employee engagement. According to the Harvard Business Review, companies spend upwards of $1.5 billion a year on employee engagement tools. However, in the past 15 years, employee engagement has remained below 35% on average. It’s not that these tools aren’t effective, but rather they only represent a part of the solution.
“A software application that administers employee engagement surveys will be adept at measuring an organization’s engagement level, but it likely won’t be able to develop and execute on programs to improve it,” said Mammoth HR.
But, if you have an in-house HR team with external support dedicated to acting on the information the technology resource provides, they will be able to take what they know about the culture of the company, and work on initiatives to improve employee engagement.
Why Hybrid HR Solutions Are Worth It
Hybrid HR solutions or partnerships build lasting, positive HR outcomes for businesses in several different areas. We’ve outlined some of the largest benefits here:
Did you know that the average cost of an employee lawsuit is $160,000?3 Staying up to date on compliance is crucial, especially with laws about FMLA, parental leave, and overtime constantly changing. This is even truer for businesses with locations in different states since these policies tend to be dependent on location.
An HR partnership provides a level of expertise that can help ensure that the organization is compliant and protected. This helps to avoid lawsuits and fines from state and federal governments, which could sink your entire business. Simply reducing the risk of a compliance issue more than pays for the resources you give your HR staff.
- Save Time
Hybrid HR solutions put more time back in the hands of an in-house HR team. A survey conducted by Mammoth HR found that HR staff at small and mid-sized businesses spend about 25 hours a month searching for HR answers. Partnering with an HR provider leads to quicker, more accurate answers to questions that don’t always have obvious answers, such as:
- Is it okay that an employee on FMLA was seen exercising in the park?
- What do I do if an employee gets caught drinking at work?
- What do I do if an employee takes an interview for another job during work hours?
- Encourage Company Growth
Because Hybrid HR solutions focus on building and enhancing in-house HR capabilities, the results can be numerous for overall company growth. Mammoth HR explained that partnering on an initiative that reduces employee turnover can have dramatic effects on the bottom line, but the program improvements that contributed to that result will create long-term benefits for the company, such as improved hiring processes, better manager training, and a more engaged culture. Along the way, the in-house HR team will be improving their own skills.
Moving Forward With Hybrid HR
There are many types of hybrid HR solutions to consider. You can work with partners that provide technology, knowledge banks, dedicated HR professionals, and more. No matter who you work with, Mammoth HR suggests looking for a partner who is “invested in your long-term success and is truly engaged in learning about your business.”
Here are some factors to consider when looking for a hybrid HR partner to create a hybrid solution with:
- What is your company hoping to achieve from an HR partnership? You can use the benefits we listed above as a starting point (compliance, save time, company growth).
- Will the partner provide you with access to a team of certified HR experts to consult with?
- Does the partner provide important HR tools and resources like company handbooks, templates, and state-specific guidance?
- Is the HR partner centered around technology? Do they integrate with your other technology solutions?
Solutions To Consider
Once you know what you’re looking for in a hybrid HR solution, it’s time to find a partner. While there are plenty of third-party HR partners, we’ve outlined a few different solutions below. Each take a slightly different approach to HR hybrid solutions but offer plenty of resources to enhance your in-house HR team.
- Society For Human Resource Management (SHRM) provides education, thought leadership, certification, community, and advocacy to enhance the practice of human resource management and the effectiveness of HR professionals in the organizations and communities they serve. They have plenty of free resources for HR professionals, including templates for job descriptions, company handbooks, HR Q&As and more. They also host seminars and certification programs for HR professionals to learn more about topics like compliance and compensation.
- Mammoth HR is a Collaborative HR company currently working with 80,000 businesses across the country. They offer:
- HR expertise through live HR consulting. They’ll work with you to address your business’s unique HR challenges.
- A technology platform featuring a suite of HR tools, templates, job descriptions, document/policy customization, law library, trainings, handbook builder, and much more
- HR answers across all 50 states from certified HR Advisors who have an average of 16 years of experience
- Training and education to help your in-house HR team save time and strengthen their skills
- WorldatWork is a nonprofit that works to create engaged workforces. They specialize in educating businesses about different compensation models. They have plenty of seminars, webinars, and free tools.
Hybrid HR solutions offer the best of both worlds: The benefits of having in-house dedicated HR personnel, as well as a suite of HR technology and resources to tackle edge cases larger HR initiatives.