4 Reasons Healthy Small Businesses Outsource HR

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Author Dr. Bob Kohnle is the CEO & Founder of Aliat.

I started Aliat because I believe in the power of small businesses, working together. I think small business owners are the everyday heroes of our business world. It’s tough out there, being the boss (and also sometimes having to take out the garbage, or change the printer cartridge), but I’m sure you’d agree with me that it’s worth it. That it’s intrinsically rewarding to build and grow something of your own.

But there’s a difference between building your own business, and having to do it all by yourself. What happens when (like so many of us) your desire to do it yourself becomes a reality, and you’re doing all of it yourself?

Over the years, I’ve worked with hundreds of small businesses. I’ve seen that the smartest and most successful business owners have quite a few things in common, including the tendency to outsource HR function. Here are 4 common reasons why HR is one of the smartest processes to outsource:

1. Reduced legal and compliance risk

Think about this: one HR violation, no matter how accidental or inconsequential, will cost you more than years of outsourced HR support. Starts to seem like a no-brainer, huh?

When you outsource HR, you essentially get an HR professional in your back pocket. They have a deep understanding of federal regulations, EEOC requirements, hiring and firing best practices and workplace compliance. Not only does this reduce your legal risk but it also means you can get fast expert answers to your questions (i.e. no more googling).

Ready to outsource HR, but not sure where to begin? Read the Healthy Business Handbook.

2. Outsourced HR = happier employees

One of the biggest changes a business owner will see after outsourcing HR is a more effective HR system.  An effective HR system means that your new employees are onboarded quickly and seamlessly, your current employees know who to contact with questions and concerns, and you aren’t wasting hours handling complex or contentious HR issues.

This isn’t just a perk for business owners – it’s actually a perk for employees. It ensures that you’ll be able to hire and retain a talented workforce, and focus on employee engagement instead of spending all your time on paperwork.

3. Someone can do it better (and faster) than you.

It’s the most well-known secret of being a business owner: you do a lot of work that has nothing to do with your actual products or services. And we all understand that while that’s not a scalable way to run an operation, it’s also not entirely avoidable. Your job as a business owner is to ensure that the tasks associated with running your business are being done by the person best suited for the task, which will save you time and money in the long-run.

The trick is to outsource tasks and processes that are definable, time-consuming, or require specialized knowledge / certifications. The reason that HR is outsourced so regularly in small businesses is because it perfectly matches all three of those requirements.

4. You can scale quickly

Whether your business has been open for six months or six years, you are probably trying to grow. For your business, that might mean opening a second office, landing a big client or launching a new product.

When it comes to growth, only one thing is for sure – it can happen very very quickly. Successful businesses are structured so that when the demand explodes, so does their ability to meet it.  When you outsource HR you can identify and hire key candidates quickly, and get them onboarded even quicker. So when your business hits a growth spurt, you’ll be ready for it.

Aliat is your partner in long-term business health. Request a consultation for our unique 360* HR solution that will transform your HR processes, payroll, health benefits and compliance risk.