Unit 6 Outsourcing

My task for this blog, is to examine outsourcing, the pros and cons of using this platform.


Outsourcing is designed to:

1. To lower operating costs.
2. Allows HR to focus on complex areas such as strategy and talent.
3. Help the company adjust to the demands of corporate downsizing.
4. Assist HR, when there is not enough talent to carry out traditional HR tasks.
5. Companies want to outsource payroll due to the complexity of these kinds of tasks.
6. Assist HR, when there is no legal expertise when developing handbooks, contracts, sexual harassment policies, etc.

Stackpole (2006-2008) says that any task that involves employee knowledge should not be outsourced to outside vendors because they do not have the intimate knowledge of the business and its employees. Outside vendors have a specialty and singular focus, such as payroll, 401K retirement plans but not the company as a whole (p. 2). The current trend is to outsource as a cost reduction measure, so that HR can shift their focus from transactional tasks to complex corporate matters such as talent management and strategy. Traditional tasks include benefit packages, administration, payroll and even word processing functions. However, with that being said, employee satisfaction needs to be considered when using inadequate or poorly prepared companies for outsourceing.

As an example, our entire IT department was let go and the function of the help desk and systems management department was outsourced; employees taking their experience with them. There was a reorganization of those in leadership positions that remained, so in this way, not “everyone” was let go. A company was hired as an external help desk for us and this is where the problems began. Besides letting go and the sadness of saying farewell to well established relationships, the new technicians had not worked internally at our company, nor did they understand the software systems of our legal department. It was a very difficult transition for them and for us. It took about six months for the adjustment and now when we call the helpdesk, most of us can get the help we need when experiencing computer issues.

I am sure that my company saved money by outsourcing and not having to pay salaries, and expensive benefit packages, however, those that were let go took so much experience with them. In addition, the soft cost of employee frustration was seen as a small price to pay for the organizational savings. I think that outsourcing is good and is also a way to link a company with the community and outside businesses, because you never know when a link to the pipeline will be needed, but it must be used judicially and not as a catch all to replace experienced employees or an easy way to save money.

Resource

Stackpole, B. (2006-2008). HR functions: In-House or Outsource It? TalentPool Company. Retrieved from Http://www.talentpool.ru/ed/text/info/hr_funtion_in_house_or_outsource_it