Organizations are always committed to earn economic profit with expanding the network accordingly, and there are certain aspects that depend heavily over the financial competitiveness of the company. There are certain industries of the world that are expanding their networks accordingly and effectively at the same time in particular. Financial and strategic capabilities are some of the major aspects from the viewpoint of the organization for which an entity takes different decisions.
Organizations usually referred to as places that have a number of departments in particular and among them, the name of Human Resources Department is one of them. Apart from hiring and firing, there are certain aspects that deem extremely important for the sake of the organization. In the current economic scenario, it is found that outsourcing has now become an integral and effective thing from the organization’s stand point as it is some of the cost efficient solutions for the companies that lead to broadening the net income provision of the companies. The main perspective of this assignment is to write an essay on the "HUMAN RESOURCES OUTSOURCING (HRO) EFFECT ON BUSINESS PERFORMANCE". It is required to analyze an article written by Lily & Julian from different angles, like how the author has summarized all of the issues and advantages related to outsourcing and its effects on the performance of the businesses.
Implementers of HR functions outsourcing:
The outsourcing of human resources functions is always an ultimate option for the organization either small or blue chip companies to mitigate the recruitment expenses and amplify the efficiency of the department in terms of cost and quality. Most of the large companies find it beneficial to outsource the entire recruitment process for instance payroll rather employ a couple of employees and purchase reasonable technology so that those employees would be committed to focus and maintain payroll processing. However, small medium businesses also have a firm believer in outsourcing human resource functions that will result in a positive impact over companies’ cost efficiency, and performance as well. Moreover, it will further enable the business to get project centered approach that is associated with the company (Juliana D, David A & Edison, 2014). In accordance to Lily & Julian’s article, around a significant amount of large and small businesses have a census to look over HRM operation outsourcing for the betterment of the company in regard to labor costs and purchasing costly technologies.
Human resource outsourcing (HRO) impacts over business performance:
The performance efficiency of the business has always been a focal point before evaluating the benefits and drawbacks of HRO processes. There are usually two schools of thoughts that are there to define the whole scenario as directed by Lily & Julian where first one consists of focus that is required over the energy and expenses to generate an end product for sale. In order to go in this way, the company will certainly assign the resources from different aspects such as in engineering and R&D. Whereas, the other scenario is more likely concerned to human capital and skill, if the company is not adequate to build up the effective human resource department to meet up the standards to provide talented workforce, then the best option to overcome on this dilemma is HRO processing to block the gap of internal HR expert . Therefore, in both the scenarios, produce and sell the product or lack of talent in leading the strong human resource department. The company can easily justify the utilization of human resource outsourcing services for the improvement of product sale and cover up the loopholes that come across in building the efficient HR department.
Long Term impact over business performance:
The time when the businesses are duly engaged to get benefited from HRO services, and then the next thing is to go for strategic leaders for HR department. The hunting for the real professional human resources administration will definitely take the company towards the next level. However, the SMBs find it difficult to employ the skillful labor simultaneously. At this stage, the HRO enables the small medium organization to get the expected benefited from their workforce that are only associated with the larger organizations as a whole. Once a company can retain the position in the market regarding its product portfolio, success and profitability through HRO processing decision, then the company can carry out the search for HR executives for activating in-house HR function that were prior outsourced for restraining the target position.
The article written by lily and Julian has contemplated enormously over the business research process and its ability to reach on a certain decision for taking effective economic decisions. There are eleven different steps which have been considered in this article which are essential for establishing an effective medium for outsourcing . From the crux of this research paper, it is found that organizations have effective economic effects due to the outsourcing stance in particular. It is also summarized in the article that outsourcing provides a cost efficient process to the organizations for their different departments, in which Human Resources Department (HRD) is one of them. Cost efficiency always is effective for an organization in terms of economic performance and strategic strength. The article also revealed that there are numerous organizations in the world which are using outsourcing for their HR department, in order to bring cost efficient solutions for their organizations that have a direct connection with the financial position of the company and large and multinational corporations (MNCs) are now utilizing the same outsourcing stance for the betterment of their performance.
References
Cook, M. F. (2008). Outsourcing human resources functions: how, why, when, and when not to contract for HR services. London: Society for Human Resource Management.
Price, A. (2011). Human Resource Management. Chicago: Cengage Learning.
Juliana D, L., David A, G., & Edison, V. (2014). Outsourcing the Human Resource Function: environmental and,. Meghna Journal Of Business Stvategies, 22(1), 55-60.
