Pros And Cons Of Outsourcing

Outsourcing is prevalent in the industry. Organizations began with outsourcing specific technical functions or manufacturing processes. Since they want to work more efficient and save time, outsourcing has spread to all organization’s departments such as marketing, finance and especially human resources. This paper will discuss about the general view of outsourcing certain human resources roles, including payroll, temporary replacements and relocation. By outsourcing each of these roles an organization can reduce overhead, risk and save valuable time when conducting normal business operations. These ideas are explored below.

Who’s outsourcing?

Human resource outsourcing is a process of outsourcing involving particular HR functional tasks like recruitment, making payroll, training and development to a third party company who have expertise in these respective fields. HR department is now playing a key role in the top management decision making, which has to take care of a bunch of functions. The bigger the organization is, the more tasks it has to do. When those tasks become too much and prevent the organization from reaching maximum profits and achieving its goals, it may have to

1. Cons: Outsourcing HR functions may have some positive changes, but those changes which are not necessarily ones might lead to negative effects.

Keeping HR in-house is one of the important parts of some organizations to get the returning of dedication, flexibility and responsiveness from staffs and employees.

- Even though the organization may increase productivity and reduce the overhead cost, they lose the ability to follow the improvement of technology and the changes in the HR environment since the supplier does everything.

- To maximize the profitability, some of the contractors may reduce their service