What Is Human Resource Outsourcing?

Human Resources Outsourcing (HRO) is a management strategy that outsources some functions of human resources management to professional organizations. Designed to effectively increase efficiency and make the operation of outsourced functions more professional. In the organization's human resource management practice, some non-strategic functions are often used for outsourcing. With the development of information technology since the 1990s, the use of outsourcing strategies in the field of human resource management has become increasingly frequent. ^[1]

Human resources outsourcing

Human Resources Outsourcing

The term "outsourcing", the English name is "outsourcing", which literally means "external sourcing", refers to finding resources outside the organization to complete the internal work of the organization. "Outsourcing" was originally applied to the information system technology industry, and later developed and expanded to industries such as production, sales, research and development, logistics, and human resources, so that the term "outsourcing" became a separate term.

Human resources outsourcing, referred to as HRO. Refers to the management of one or more human resources according to the needs of the enterprise

What does human resource outsourcing include? "The work involved in human resources activities" first includes human resources and their carrierpeople, and secondly includes various matters around the human resource carrierpersonnel, and also includes various management for human resources Activities-human resources management functions.

Now we can see that under a large concept of human resource outsourcing, it is divided into three modules: human resources and personnel outsourcing, personnel affairs outsourcing, and human resource management function outsourcing. In order to effectively distinguish between large-concept human resource outsourcing and small-concept human resource (and human) outsourcing, the industry uses the small-term human resource (and human) outsourcing in the professional term "

From a service industry perspective

Human resources outsourcing belongs to the service industry and has the common characteristics of the service industry:

1. Intangibility: Human resource outsourcing service is an action. We cannot see, feel or touch this action like we feel physical goods.

2. Heterogeneity: Because human resources outsourcing services are a series of actions expressed by humans, no two services will be completely consistent. Different companies, different employees of the same company, and the same employee will provide different services at different times, and the same service will have different feelings in the eyes of different clients.

3. Synchronization of production and consumption: Human resources outsourcing services are different from physical goods. They are produced first and sold and consumed. The process of production of human resources services is also the customer's consumption process, even if the customer and service personnel have no contact in the process. When we provide service to clients with on-the-job formalities or social insurance management, or when customers call service providers for telephone consultations, the "instantaneous" of production and consumption occur simultaneously.

4. Perishability: Human resources services cannot be stored, resold, or returned, and need to be re-produced after "instantaneous". We can't imagine the customer dissatisfied after calling for half an hour, and then returning the half hour to the service provider for reuse or sale.

From the perspective of human resources activities

Through the analysis and research of human resources outsourcing activities, gavin zhong, a veteran of human resources outsourcing, believes that human resources activities that can be outsourced can be found to have the following characteristics:

1. Basicity: The content involved in human resource outsourcing is the basic part of traditional human resource activities, that is, it is basic, which is a necessary reason for the existence of human resource outsourcing activities. The society has entered the 21st century, and business management has also become mainly human resources

The role of human resource outsourcing is at the micro-enterprise level and the macro-social level:

1. Human resources outsourcing leads to large-scale social operation of professional institutions, reducing the cost of individual enterprises

The same work of multiple enterprises is concentrated in one professional organization. In addition to the advantages of technical proficiency, professional organizations can convert three identical jobs in three enterprises into three identical jobs in one enterprise, thereby labor, time and process of

Human resource outsourcing not only has realistic social roots (reducing corporate costs, improving core competitiveness of the enterprise, and promoting the refinement of social division of labor), but also has its theoretical roots:

Human resources outsourcing in China can be traced back to the early days of reform and opening up. In 1980, the State Council issued the "Interim Provisions on the Management of Permanent Representative Offices of Foreign Enterprises", which compulsively stipulates that foreign enterprise permanent representative offices should entrust the government-designated foreign service units to handle Chinese staff employment procedures. Although this service, called "Provision of Chinese Employees to Permanent Representative Offices of Foreign Enterprises," was born of a compulsory policy, and it was far from actual human resource dispatch services at the time, After all, we can more or less see the shadow of human resources dispatch.

Overview

We all know that traditional enterprise human resource management work can be roughly divided into two aspects, one is operational and the other is strategic. The so-called operational items refer to attendance, personnel file management,

(1) Outsourcing selection under the guidance of the enterprise life cycle

Enterprises can be divided into entrepreneurial period, development period, stable period, and recession period according to the development stage. The risks at different stages are different, and the businesses they focus on are also very different.

1. Entrepreneurship period: the scale of the company is small, the business is not much, the prospects are not clear, and the corporate culture has not yet formed. At this time, it is the period when managers and employees establish a good relationship and work together for the development of the enterprise. Effective evaluation, insufficient understanding of outsourcing risks, it is not appropriate to outsource.

2. Development period: the scale of the company increases, the business increases, and the demand for human resources increases. At this time, some business outsourcing, such as recruiting employees and social security agents, is considered in consideration of their actual conditions, which will help focus more on core business promotion Enterprise Development.

3. Stable period: Enterprise development tends to be stable, scale and business increase steadily, and human resources management is becoming more strategic. At this time, enterprises can get advanced human resources management services, and outsourcing human resources administrative affairs can save costs and energy, improve corporate management capabilities, and obtain more profits for the enterprise.

4. Recession period: Due to technological backwardness and lack of innovation, market share is declining, competitiveness is weakening, human resources activities should be completed by the company, closer the relationship between the company and employees, so that employees take into account factors such as corporate culture and increase loyalty.

(B) Strengthen employee training

The introduction of outsourcing may make employees uncomfortable. Therefore, before introducing outsourcing, employees should be provided with human resources outsourcing-related training so that employees understand the significance of outsourcing and allow them to accept outsourcing from the heart. Employees learn on their own and at the same time hire professional consultants to train employees for outsourcing knowledge. During the outsourcing process, employee satisfaction should be actively tracked, communication should be strengthened, and problems identified should be addressed in a timely manner to avoid brain drain. After the outsourcing is over, solicit opinions from employees, improve employee participation, and lay the foundation for the smooth progress of the next outsourcing business.

(Three) choose a professional outsourcer

When choosing an outsourcer, you can't just consider the best cost and ignore the ability of the outsourcer. First of all, companies should do a background check on outsourcers, choose a professional and reputable outsourcer, and do a cost-benefit analysis. Second, understand the culture of outsourcers. Finally, communicate with the outsourcer to make cultural integration consistent with corporate development. Only in this way can we truly choose the most suitable outsourcer.

(4) Familiar with relevant regulations

China does not yet have a piece of legislation to protect human resources outsourcing business, which is mainly based on laws such as the Labor Law, General Principles of Civil Law, Technical Contract Law, and Anti-Unfair Competition Law. Encrypt the company's core technology and key information into the scope of legal protection. Sign a confidentiality contract with the outsourcer, and specify the scope of corporate secrets and mutual rights and obligations in the agreement. At the same time, make provisions for the departure of personnel familiar with trade secrets among the outsourcers to prevent the outsourcer from shirk responsibility when the information is leaked by the departing staff. In order to better complete this measure, the human resources department should review the contract content by the company's lawyers when signing the contract.

(5) Strengthening supervision of outsourcers

The outsourcing of human resources does not mean that the human resources department can leave it alone. As the most important department of outsourcing activities, the Human Resources Department should supervise the behavior of outsourcers. First, regularly evaluate the work of the outsourcer, understand the completion of the outsourcer's tasks, and measure whether it is consistent with the established target development direction. Second, communicate with the outsourcer about reasonable suggestions made by employees during the outsourcing process, and provide answers to the problems encountered by the outsourcer. Third, in order to avoid the leakage of confidential information, the Ministry of Human Resources shall cooperate with various departments to establish document management and information security guarantee mechanisms. Fourth, understand the operation status of the outsourcer, prevent the bankruptcy and dissolution of the outsourcer from causing losses to the enterprise and take precautionary measures.