Outsource HR? Really?!

Small and mid-sized colleges and universities are looking for ways to control costs and for many, some form of a shared services model might be a solution. While a small college might not be able to afford the best student services or finance software, partnering with several other similar institutions offers the collective ability to afford the software and share some back-office staff, reducing expenses for each college. It’s a great concept, but often difficult to execute. It takes a trusting relationship between institutions who are often competitors – if not for students, then at least for talent.

An alternative to sharing services is to outsource some functions. It is not uncommon for universities to outsource custodial work, campus safety, or groundskeeping. While outsourcing these functions does alleviate some level of administrative management, it probably does not result in any substantial cost savings, nor an increase in the quality of the work. For outsourcing to really be worthwhile, it needs to either cost less than doing things yourself or provide a markedly better service—and ideally, a bit of both. 

One area to look at closely at outsourcing is Human Resources. If you have under 200 regular full- and part-time employees, you likely have one, or maybe two, over-worked HR professionals who are trying to do everything, including recruiting, onboarding, benefits, employee relations, and quite often Title IX.  They are managing some level of HRIS (maybe just on spreadsheets), doing your reporting, overseeing HR compliance, writing HR policies, maybe doing some employee training, and dealing with your lawyers when there is a compliant of discrimination. Plus, somebody else is already running payroll. You may use a payroll company like ADP to “process” payroll, but someone in-house is entering the changes, collecting the timesheets, updating direct deposits, etc. You might have stepped up to a newer HR/Payroll system like Paycom, Paycor, or Paylocity, but you’re still doing most of the work and probably not utilizing those systems to their fullest extent. It is exhausting just to write about it – and much harder to actually do it.

Outsourcing your HR can provide you with a substantial upgrade in many categories. Rather than having one person try to do everything, the provider will have a team of experts, and you’ll get a fraction of those experts to address what you need done. Because of their experience and resources, they’ll be able to do better work, faster and less expensively. On top of that, your organization can now have access to better technology, employee/manager self-service, and better benefits administration.

I get it. The idea of outsourcing HR feels weird. It doesn’t feel natural to take something as “personal” as “personnel” and have someone outside your organization manage it. But it should save you money and improve your HR operations. In these days of controlling costs and focusing on what you do best, it’s worth looking into.

Roger Dusing, PhD, is a Senior Consultant and the Higher Education Practice Leader at OMNI. He previously served as Chief Human Resource Officer at Park University for eleven years. With over 40 years of HR experience, including 30 years in C-suite level roles, he looks forward to reflecting his passion for higher education in his work to bring affordable, high-quality HR services to small- to medium-sized colleges and universities. 

Roger holds a PhD in Business Management, with a concentration in Human Resources from Northcentral University, a Master of Science in Administration from Central Michigan University, and a BS in Industrial Engineering from Bradley University. He also authored the book “I’m Fired?!? A Business Fable About the Challenges of Losing One Job and Finding Another.”