3 Questions to Consider on HR Functions & Saving Cost




Business owners and leaders would agree that one of the most valuable investments they spend on every year is the cost of their workforce and managing their Human Resources. Hence, the company workforce is also companies’ greatest asset. This is how critical that businesses have to get things going and ensure that they do not waste time and money.


The HR function in an organisation can be both Transactional (Core HR) and Strategic.


Transactional HR can be the day to day functions that manages the employee life cycle. It is a set of established responsibilities- particularly involving employee relations, welfare, time & attendance, leaves, payroll, HR portals etc. No doubt your organisation will need someone who is efficient, compliant and accurate to execute this function.


The Strategic Function of Human Resources, on the other hand involves knowledge on organisational change & development - usually complex and comprehensive, talent management, employee engagement, performance management, leadership development, etc. Most of the time, the job intervention for this area varies depending on the expectations, complexities of culture, values, and many other things specific to the organisation. These functions requires different level of expertise.


You will need a practitioner who has a considerable amount of experience in managing different situations, and who invested on research & studies throughout their career to be on this level of competence. Both of these functions and its delivery will have a lasting impact on the employees and can differentiate how an organisation manages its employee experience.

Below are the 3 points to consider when reviewing or setting up an HR Function


1. Do you have an HR Roadmap? Set your Goals, People Strategy and Manpower Plan


As a business - small or big, you will need a strategy on what workforce you want to develop. This is to avoid making mistakes from reactive approach and doing trial and error such as, wrong hire or over hire leading to high employee turnover. This will ultimately cost the business and is definitely a waste of money. Getting the right HR Service Provider to advise you with your manpower plan, HR Strategic Plan, Budgeting, and Organisational Design will save you time and money.


2.What is the cost impact of having an in-house HR Function and compare with an option of getting consultants to do the job?


Whether it’s for setting-up or maintaining HR, there will be a cost. The overhead and other HR associated costs are typically high when you do it in-house due to regulatory expenses and employee-related expenses but if the value is worth in doing so, then you will have to take a call. Establishing a fully functional HR Department will require additional offices, HR systems, insurances. Evaluate the cost impact to your organisation and consider the training costs and induction period cost. The cost will be significant for all companies. If you are only starting, you may want to start gradually and check the services that you need.



3. Consider Outsourcing or External Service Providers. What services can be outsourced?


In most situations, businesses can achieve high level of efficiency and workforce management by engaging with a professional HR Consultants & Service Providers. It may have significant cost-saving impact for your organisation in the long run.


If you only need to kick-start to ensure that you are on the right path, it may be worth it to consider hiring HR Consultant to save your time and risk the cost of mistakes, wrong hire, time loss and regulatory expenses. It will be worth looking at a more cost-effective way of having an HR function and speak to HR Service Providers if you think that this more practical for the organisation. Make sure you get the right person for your requirement. Usually, the start-ups and smaller HR consultancy companies are best pool to start with. Not only that they are less costly, the services they provide are usually not framework-theory, more practical and realistic.




Focusing on employee experience, minimising unnecessary costs, and ensuring effective service delivery is the future of HR and creating a balance on these areas can be a win-win situation for the organisation and its employees.



Our team of HR Consultants from People Bureau International can assist you in planning your Human Resources and in preparing your HR Roadmap to ensure that you are on the right track. To contact us for initial discussion, click here.

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