Startups, entrepreneurs, and small business owners are constantly looking for solutions to gain an edge on their competition. Here’s three ways PEO companies will give you that advantage in the HR department.
See also: What is a PEO and What It Means to You
When it comes to outsourcing HR related details for your company we would like to help clear a few things up and shine some light on how to make an informed decision.
PEO companies allow the majority of your HR responsibilities to be lifted from your shoulders. Some of these may include:
- Workers’ compensation & workplace safety
- Payroll procedures
- Government compliance management
- Health and Welfare Benefits for you and your employees
- HR Best practices and policies
- Performance management
- Training and development
Here’s three ways PEO companies can help your startup:
The number one thing to consider when deciding whether HR outsourcing with a PEO is right for you, is choosing how you want to spend your number one resource; your time. One key question is: How can you maintain full compliance with all the intricacies of HR and still have time to devote to doing the things that make your business profit and thrive?
Your time during the first few years must be strategically allocated to the areas of your business that will have the biggest impact on your immediate and long-term success. Where are these areas? The answer is simple. They are your core competencies, doing what you are great at and what your clients pay you to do. These are the areas of your business where you shine, and were at the heart of your dream to start your business. They are also the very things that will allow you to be truly successful. Your startup team should be focused on what’s important, developing your product or service, drumming up business, earning revenue, and beating your competitors. Your schedule simply can’t afford to be overtaken by small tasks related to common HR duties like personnel issues, payroll, benefits administration, employee policies, and hundreds of other time stealers that will nickel and dime you to death.
Startups are like babies, and babies grow fast. They can outgrow things that fit them 3 months ago. This is a very important variable that also heavily supports a statup’s decision to outsource day to day business administration like payroll and HR to a PEO. Your business will be changing rapidly; you will need solutions that can scale quickly with you.
Many times, a startup lands that big contract they have been working on for the past year, and before they know it, it sinks their business because they did not have a scale-able solutions in place to allow them to grow at the speed needed to fulfill the contract.
3. PEO Companies Offer Experience
Successful startups often utilize key advisers and experienced veterans that help guide them because they know experience is an invaluable tool in their tool belt. Seek it out and learn from those who have gone before you. When it comes to HR for your company, it’s the same story. PEO companies can offer you a team of professionals with decades of experience even when you are a startup. This experience will help you make smart decisions when it comes to creating a plan for health care reform and your business, safety programs, payroll efficiency, and employee policies.
Knowledge gaps will be uncovered as you grow. We have found that many entrepreneurs and business owners are extremely good at what they do, but as soon as you introduce managing day-to-day functions like bookkeeping, financial planning or HR administration there are obvious inefficiencies. What should they do to cover these gaps? Take care of it by outsourcing these tasks to professionals.
Don’t let your time and money be wasted on managing your startups evolving requirements and responsibilities related to human resources. Instead direct your focus, energy, and skills where they belong: developing your business. PEO companies will help you reach success by having your HR details taken care of by a team of experts, so you can focus on building your own team.
Is It Cost Effective?
Wondering about the bottom line? As you know, HR costs include much more than wages. All HR functions have an associated cost. Outsourcing your HR will definitely have a price tag, but it is usually far outweighed by the freedom it provides you to focus on revenue generating tasks.
A great example can be found by looking at many CPA firms. If anyone would be capable of doing their own payroll, these guys fit the bill. BUT many savvy firms actually choose to leave it to the professionals and focus on serving their clients instead.
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