Take A Load Off!

Sold on the idea of outsourcing at least some of your human resources functions? Choose your provider carefully, advises McGlone, who indicates that, as demand for outsourcing HR has grown, a number of companies have gotten into the field but gotten out just as fast. That's left clients scurrying to fill basic HR functions. The shrewdest way to avoid that mess is to closely scrutinize candidates, paying close heed both to each company's current client list and how many years it's been in business.

Where should you look for HR consulting firms? Local business Yellow Pages may be a help, but the fastest hunting is done on the Internet. A starting place: Yahoo!'s list of hundreds of firms that handle HR chores. Find it by logging on to: http://dir.yahoo.com/Business_and_Economy/Companies/Corporate_Services/Human_Resources/Consulting/ Prefer a more tightly edited list? Scan the entries at LookSmart, another search engine (http://www.looksmart.com). Between these two search engines, you can find links to sites for specialists located just about anywhere in the nation.

Surprisingly, price will probably not be a huge factor in your choice of a vendor. "There's less and less variation in bids," says McGlone. He explains that as the industry has matured, it's grown smarter about how to price its services, and most established firms will make bids that differ only marginally. But not all firms will deliver the same quality work. "Be alert to differences in how much your fee is buying," says McGlone.

That's key, because about half the respondents to Lawler's survey had a gripe about the quality of the work done by their HR outsourcing firm. "Services not as good as promised," said 53 percent. But, significantly, scarcely one-quarter reported "negative reaction from employees," meaning workers won't likely object to an outside HR provider. Indeed, sometimes employees actually welcome the switch if it means services are provided more consistently and professionally than they had been when HR was, at best, a secondary job duty for managers in their company.

"HR outsourcing is growing in popularity simply because it works for client companies and their employees," says McGlone.

Dushinski seconds that: "With HR outsourced, we have so much more time to really service our clients and grow the business. Outsourcing works for our employees, and it definitely works for my company."

This article was originally published in the August 1999 print edition of Entrepreneur with the headline: Take A Load Off!.