What is the HR Outsourcing Model?
An outsourced HR model that breaks recruiting, orientation, training and compliance (ROTC) into manageable pieces. This model supports the HR function and saves the company money.
New HR Paradigm
HR (and all other departments) must be designed to achieve your company’s top and bottom line financial goals. It can and should be a cost savings instead of a cost raising department. Since employee costs are such a large part of any company’s budget it is especially important that HR be set up right.
Why this model?
HR has so many parts that it is too complicated for any one person to handle. Ask yourself, “how can any one person know all the aspects of recruiting, orientation, training and compliance?” Because of this, spending $50,000-$100,000 to hire an HR Generalist is prohibitive in terms of cost versus value. It is more cost effective and efficient to break HR into 4 different but aligned functions (Recruiting, Orientation, Training and Compliance. ROTC) and support them with the right inside/outside implementation managers.
Here is the basic idea:
Recruiting should be a standalone department reporting to the president/GM or Marketing Manager. Why? Because finding the right people to work in your company can be even more difficult than finding new customers. The President/GM or Marketing Manager usually knows best how to present information about the company and this information can be used to put together a recruitment description (one that positions the job and company powerfully) that will attract the right candidates.
The goal is to find people who are 8’s, 9’s and 10’s that fit into your culture. By doing this, managers will be able to require that everyone perform at a 7 (this is critical to your success) level or higher since they will be able to find superior performers anytime. By using this model along with a contract recruiter skilled in using Internet technologies, you can virtually eliminate high priced contingency recruiters (with high commissions) who really don’t know your culture (how can they?). The internet has made the contingency model obsolete since candidates are now in public domain.
For most companies the #1 HR cost is keeping people whose cost exceeds their value. A strong recruiting program will allow you, as Scott Urban says, to “Keep the people you can’t afford to lose and lose those people you can’t afford to keep.” ™ It can pay for itself. We can refer proven recruiting resources (that know how to do powerful recruitment descriptions) and provide you with a recruiting model that works!!!
Desired outcome: 3 good choices for every position with 60 days or less..
Once a person is hired they should go into a 90-day “employee driven orientation program” (culture indoctrination). That’s right. The employee drives it. Their manager, the compliance person and a mentor provide support but the new employee is in the driver’s seat from day one. This will show you how much initiative they have. It will also give you the opportunity to hold off on providing benefits and incurring other employee costs until you verify you made the right hiring choice. We have a resource that has a generic Orientation Program that you can modify to your company’s needs and we can also help manage the process if needed.
Desired outcome: Make sure new employees understand both your culture and what they and you need to do so you consider their performance level an 8, 9, 10. If it is determined you made the wrong choice terminate them legally and compassionately at this time.
Training is like health…a very broad and complicated subject. After a person successfully completes Orientation, they enter into your company’s Ruh Advanced Leadership Program. Why? In order to continue the process of the employee driving his/her career and enrolling the support they truly need (making the company an environment in which to grow). The goal is to support a change in one’s self-image that will increase their potential performance. Self image precedes performance. The Ruh Advanced Leadership Program concept is powerful when practiced over time. It can be implemented by your HR generalist or an outsourced training manager and should compliment your other training processes
Desired outcome: A self-driven PPD program that supports employees in working toward your goals and theirs. Your company thus becomes an environment to grow oneself. Both parties see what is needed to perform at an 8, 9, 10 level and work towards it.
Your compliance program always needs to ensure you are always protected from undue risk. This can be coordinated by your accounting manager who works with outside vendors and specialists (due to the complex nature of the myriad compliance laws). Frankly it does not cost that much to protect yourself when you consider the cost vs. dealing with lawsuits and angry, disgruntled employees. With a little common sense and the right resources you can easily ensure that employment law issues, compensation plans, health insurance options and other employee benefits are kept in compliance with the ever changing laws.
Desired outcome: No lawsuits along with competitive compensation and benefit programs (no matter what size company) that supports both your top and bottom lines.
What does all this cost and what are its limitations?
- John M. Ruh Consulting design fees which include access to all our models/programs and specialists at no additional cost other than B when needed:
- Specialist’s fees: We will assist you in negotiating retainers in order to avoid expensive hourly fees, project fees or high commissions.
- This is not a start/stop program or problem event approach. It is a process approach and it takes time.
- To work, it absolutely requires support from the top down and each ROTC program needs an Implementation Manager (internal or external) who takes full accountability.
Why do it?
- You will have a structured process to find, focus and support the people you need (including outside specialists/leaders).
- A process approach works better in the long run. This program also gives employees a chance to participate in decisions.
- Structuring HR functions this way will give you a better cost to benefit ratio than doing it the traditional way.