Are You Ready to Outsource Benefits Administration?

November 28, 2016 Zuman

Thanks to outsourcing, HR departments everywhere are becoming more strategic overall, structuring their efforts to contribute to the growth and prosperity of a company as a whole. Whether it's HR simply realigning their perspectives and work processes or gaining some much needed accountability, outsourcing is a massive step in integrating this department with large-scale goals and planning.

A survey by Employee Business News found 46 percent of companies already outsource, representing organizations across the country and in many unique industries. If you're an HR leader or other executive looking into outsourcing, it's important to ask yourself one key question: Are you properly prepared to outsource benefits administration?

Here are three signs you may be on the right track:

1. Does the Move to Outsourcing Make Sense?
It's not enough to outsource this vital set of administrative functions. You have to be sure that the current HR situation reflects the need for the very specific workflow that accompanies outsourcing efforts. For instance, you might consider the change if your current approach to benefits administration just isn't working out, perhaps due to a string of data issues or problems with non-compliance. The transition doesn't always have to be related to these issues, and outsourcing can be a reaction to new changes in your industry or updates to overall strategy.

Outsourcing is also a good idea if HR wants to enact other notable changes, like better addressing certain employee concerns or making better use of available data. It's also important to ask if outsourcing fits your company's unique culture and accompany goals; it's not enough to try an approach without understanding what it does to the larger internal structure.

2. Do You Understand the Advantages? 
Outsourcing benefits administration leads to several operational improvements, but it's important to understand exactly what you'll get before making the transition. One of the most immediate benefits is the impact on cost, as outsourcing alleviates many of the expenses related to deploying cloud technology and creating a paperless work environment. With greater visibility and automation through that new infrastructure, HR managers gain more insight into their decisions, helping them align their departmental goals with those of the rest of the company. The result is an HR team with more capacity to maximize efficiency and increase value.

3. Do You Have the Right Resources?
Companies consider the move to outsourcing because they believe it will enrich their efforts and strengthen the connection with employees. As such, people may be desperate to make the move without considering one very important concept: Are you in a position to make the change in the first place?

That means HR departments need to be at a certain level for the move to be effective. Does your office have the insight and manpower to deal with issues of compliance? If not, you may find yourselves quickly overwhelmed. Do you have the tools needed to successfully handle these HR-centric tasks? More than just money, these require the right internal resources and an effective infrastructure to make a difference. Finally, is your company adaptable enough to make the move to outsourcing? It's a new way of operating for HR, and that takes the right attitude to flourish under this new system. 


About the Author


Zuman is the premium solution for HR, payroll, benefits administration delivering superior control, lower risk, and enhanced employee engagement for growing companies.

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