Cost saving is a major consideration in the majority of small businesses, and consequently HR is commonly one of the areas that business owners decide to try and save money on. Many small businesses try and manage human resources themselves, without a dedicated team or external HR consultant. This, however, can often be a false economy. HR consulting services are often a lot more affordable than business owners think, and although the thought of regularly paying a consultant can be off-putting, in the long run the benefits of engaging with a HR professional will far outweigh the costs.
The breadth of business areas covered by human resources is often underestimated. HR covers hiring, performance management, employee benefits, company communication, training & development and much more. Consequently, businesses without a dedicated HR team or HR partner can find that these human resources-related tasks occupy a large chunk of the working hours of whichever employee picks up these tasks in addition to their regular job role. This time spent on HR is non-revenue generating for the business, and can have a profound effect on productivity and profitability.Although initially the cost of using a HR consultant may appear like an unnecessary expense for a small business, the time freed up from managing human resources in-house will in most cases end up being far more profitable for the company.
In addition to freeing up time, HR professionals bring a wealth of skills and expertise to the table that an employee managing HR ‘on the side’ do not possess. HR consultants are experts on the legal requirements of running a business, ensuring that small businesses stay compliant with employment legislation and laws to avoid fines or lengthy legal battles. An external HR consultant will also have access to HR technologies that may be unaffordable for a small business, but that they can utilise as part of their relationship with their consultant, adding further value.As well as the legal and technical side of things, human resources is integral in creating and maintaining a healthy company culture and working environment. Keeping employees happy, motivated and productive is key to business success and profitability, and good HR management aids this.
Perhaps the most compelling reason for small businesses to engage with HR is that proper management of human resources can potentially save huge sums of money. Employment law is very specific, and mistakes made by non-experts can end up being incredibly costly. In 2014/15 the majority of employment tribunal awards were in excess of £10,000, with the average discrimination pay out clocking in at £23.5k. These sums are enough to financially cripple many small businesses, and are far more costly than the price of on-going HR management. A HR consultant will ensure that any problems that could end up in an employment tribunal will be resolved before they escalate, potentially saving a business tens of thousands of pounds.
Whatever the size of the company, businesses cannot afford to not have robust HR practices in place. At RF HR Solutions we have over 15 years experience in providing HR support and solutions to businesses of all sizes, so talk to us today to find out how we can help safeguard your company’s time and money.