What to Outsource?

2013 and its many economic fluctuations have led to changes in strategy and operations at many Vietnamese businesses. Most are coping with similar difficulties: cutting costs while retaining their competitive advantage and maintaining a good working environment for their employees. Such challenges, however, have made businesses more flexible and willing to take the initiative in making appropriate adjustments to deal with the economic volatility. They are paying greater attention to efficiency and productivity in order to meet their objectives.

So can the Human Resources (HR) Department also contribute to business productivity? What does the HR Department need to focus on to support the organization’s strategy while still guaranteeing daily operations proceed within a limited HR budget? How can HR functions be made more productive? Below is a simple analysis on the main functions of HR, to understand its activities and find the best solution to increasing productivity in the HR Department.

No.Main HR functionAdministrative tasks considered for outsourcing Core value to be kept in-house 
1 Recruitment
  • Job posting, searching, screening
  • Shortlisting
  • Background checking
  • Preparing Offer letter
  • Manpower planning
  • Understanding business requirement in order to prepare proper Job Description and select the right persons for the organization
  • Understanding market, seeking different sources, different vendors for different positions
  • Being the ambassador, selling the competitive advantages and culture of the Organization to potential candidates
2Compensation and Benefits
  • Payroll and benefit administration
  • HR Legislation updates
  • Job evaluation and classification
  • Market salary and benefit survey
  • Keeping strong communication channel with employees on legal issues, payroll and Company policy with understanding and supporting values.
  • Understanding the Company positioning in the market and applying the Company compensation strategy in most efficiency way.
  • Designing valuable remuneration package/ scheme within the budget for different groups of employees
  • Attracting and retaining talents
3Training and Development
  • Logistic for Training courses
  • Assessment services
  • Conducting training
  • Setting up channel for training and development (e-learning)
  • Tailor-made training materials based on business needs
  • Promoting learning environment  and assessing impact of training to Organization
  • Career development and talent management
  • Succession planning
4Employee Relation
  • Legal advisory
  • Materials for communication with employee
  • Company events and activities support
  • Employee consultancy center
  • Employee effectiveness measurement
  • Employee engagement
  • Promoting a two-ways of communication and transparent channel in the Company.

Through the above analysis it is clear that the time needed for HR administration and routine tasks is significant. To meet the organization’s strategy and retain its competitive advantage, people are the most valuable asset and differentiate the organization from others. In order to keep your people, especially your talent, happy, motivated and engaged, the HR Department plays a very important role, especially in the core values. Outsourcing administrative tasks to a trusted vendor, to give more time and resources to core functions, can help the HR Department become more productive and more valuable to employees and the organization.

This analysis is only a suggestion for readers’ reference. The decision on what areas in HR should be outsourced and the line of responsibility when outsourcing should be analyzed and planned carefully to make sure the connection with your employees remains strong and that the HR Department is a trusted partner within business lines. In conclusion, we would like to share with readers a survey result from PricewaterhouseCoopers: “More than 75 per cent of companies turn to outsourcing to meet at least one of their strategic HR requirement”

HR Consulting Corner is monthly composed in a Question & Answer format by HR consultants of Talentnet Payroll & HR Outsourcing Services. Our purpose is to support readers & enterprises to understand more about HR  trend in Vietnam and update the new labour changes for prompt application.

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