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Outsourcing Prevalence Today

Free Business Essays The importance of outsourcing is a very intriguing as well as a challenging nowadays. The reasons are different but the fact of a constantly growing potential of human resource outsourcing is inevitable. This research report will cover a variety of aspects of why millions of companies all over the world consider the human resourcing as one of the major solutions for any kind of business.

The research will address the issues with the critical factors that have an impact on the position of outsourcing today as well as it will cover the main functions of outsourcing today. In addition, it would have more benefit to understand the drawbacks and benefits of human resource outsourcing for different companies all over the world.

Critical Factors that influence the Human Resource Outsourcing

In the world of today, the only thing that makes sense in the business setting is information. The companies and private professionals do business on a variety of levels both within the companies and on their own. The reason for such a practice is that it is important to know what people to hire for the particular task. Therefore, there is an investigation towards the outsourcing opportunities for every business niche.

At the same time, it is important to consider the objectives of the company as well as whether the outsourcing company would be able to manage the required work at the professional level. The idea is to have a target for the profit and make sure the right people do the job. Besides, it is also important not to save on the outsourcing as the outcomes could be negative and could lead to the worst expectations but not the increase in revenue.

The cost of outsourcing is one of the major factors that have an influence on the decisions made towards a particular outsourcing company. It is also important to compare whether the cost of outsourcing would be different from hiring a regular personnel. At the same time, there is one thing that should be on the first turn for the top management is that not all the outsourcing companies are familiar with all the types of job. On the one hand, the same job can take more time to be finished and on the other hand, there could be mistakes on the completed job, which automatically means that this job needs to be checked twice in order to make sure the company will not have any problems in the future.

The other factor that is of huge importance in terms of human resource outsourcing is that there should always be up to 5 different other human resource provider companies, who turn to in case the job is not completed according to the requirements. In terms of the requirements of the outsourced working power, the company should consider the ways of control over the outsourcing company as well as the agreement that would stick the liabilities of both parties.

The next factor is that there should be a detailed contract towards the human resource company as well as the business, which hires people to do the job. The business owner should think about all the requirements of the cooperation, including the fact of termination or renewal of the partnership as well as the reasons for it.

Human Resources Outsourcing and its Reasons

Every company has different reasons for outsourcing, especially the factors that have the impact on the human resource outsourcing. However, there are five major reasons that the vast majority of companies, who use the services of human resource outsourcing match:

First of all, the fact of human resource outsourcing helps to save money. In other words, the amount of money paid to each member of the human resource department differs drastically from the sum of money that is normally paid to the outsourcing company, which is a lot less and happen to be not regular.

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Second, it saves a lot of time when the companies use the services of the human resource outsourcing companies. For example, in case there is a department, it takes more time to organize the meetings with people whereas in case this job is performed by the human resource outsourcing team, the same job is performed but the overall human resources of the company are not used and therefore could be used in other employments.

Thirdly, in case there is a complete human resource outsourcing team, the company could increase the human resource knowledge base and simultaneously grow faster and at the same time more effectively than ever. Thus, when extra work is needed to be done, the human resource outsourcing team will find the right people in a timely fashion, which will save not only money and time but also will create more opportunities for other people to grow within the company.
The fourth reason is that the outsourced human resource team makes it possible to make an emphasis on the employees of the company, which makes it a great advantage over the competitors. Thus, the company can take priorities in the first turn, while knowing that the human resource job is performed by other trusted people.
Finally, the fifth reason for hiring the human resource outsourcing team is to build the brand of the company as well as the employees of the company. The idea is not to make the company members work for the mission of the business and not on the ways of finding the right people for performing a job.

Human Resource Funtions

The ability to outsource has already changed the conventional way of doing business today. In fact, there are three types of outsourcing that are of the major importance for the businesses all over the world such as the “standard outsourcing, human resources outsourcing as well as human resources offshoring”.

In more details, the human resource outsourcing addresses the following implications such as the “occupation of the complete Human Resource department, enrollment in the specific human resource services, interim support, and different other projects that are important for the company”. In addition, the major functions of the human resource outsourcing address the following aspects of expertise: “payroll, background checks, employee assistance programs (EAP), flexible spending account (FSA) administration, consolidated omnibus budget reconciliation act (COBRA) administration, healthcare benefits administration, pension benefits administration, temporary staffing, retirement benefits administration, software services, recruiting, staffing, and search, employee relocation, training and development, incentives, HRIS/Web-based services,and finally reference checks” (Throckmorton, 2012).

The pros and cons of hiring the outsourced human resource teams

There are both advantages and disadvantages in hiring the outsourcing teams in place of the human resource department. They differ for every company but the research addresses the most common ones thus making the performance of the company efficient to concentrate on generating revenue instead of searching for the people.

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The advantages of the outsourced human resource department are the following: the outsourced teams help to control the risk management of the company and its processes. Such teams are more effective in terms of expenses and allow to save money for the business development. Hence, the outsourced human resource people are more effective for the reason that they have the skills and experience to fulfil the most important operations of the company. Finally, these teams allow the business to concentrate on the development of the employees, while the human resource department works separately.

The disadvantages of the outsources human resource teams are important to consider for every head of the company in order to project the effective interventions for the future growth. First of all, the companies choose to hire the people outside the company in order to avoid the existing poor performance of the human resource department. The ineffectiveness of such a practice is that the human resource teams work in distance, which makes it difficult to control them. In addition, there are many problems in terms of recruiting such outsourcing human resource teams for the company. Besides, there is a continuous problem with the flow of the information throughout throughout the company, which makes it difficult to concentrate on the most important tasks. Finally, the fact of hiring the human resource teams puts the company in the dependent position, which means the complete loss of control.


To conclude, the research offered a variety of information for the contemplation about the importance of the human resource outsourcing, including the issues and challenges of the outsourcing prevalence. It covered the overall information about the factors that have impact on the Human Resource Outsourcing, while covering the reasons, functions, advantages and disadvantages of hiring the outsourced human resource teams.

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