Weighing Your HR Options: A Guide to Finding the Right HR Service Provider

As small and medium-sized businesses (SMBs) grow, managing human resources (HR) can distract from other essential roles business owners play. A survey found that 45% of business owners said they need fewer distractions to be more productive. HR can be an especially difficult “distraction” from your core business. This is because few SMB owners have enough time or HR training and experience to efficiently deal with the administrative tasks, much less the compliance and risk management concerns.

Perhaps that’s why many SMBs seek to outsource their HR operations. At first, their search might be driven by a discrete need, such as a desire to offload payroll processing. Or perhaps they understand—as many SMB owners do these days—how necessary broad HR expertise is for creating a workplace that attracts and retains the right people for your business.

Regardless of the HR service SMBs seek, price is almost always a first consideration. The challenge is that face value pricing is rarely an apples-to-apples comparison. For one, face value pricing comparisons don’t consider the value-adds that HR expertise can bring, including the ability to grow with your business and provide additional services to help you scale. That’s why TriNet offers an HR Benchmark & ROI Analysis to help you understand your company’s current state and the potential areas of HR improvement that can support your growth strategy. Such analyses factor in potential renewal increases, as well as ROI, to help you understand your total HR cost

Still, the challenge of understanding the true pricing tradeoffs is but one of many challenges that SMBs confront when seeking to outsource their HR. Developing a company-specific process for assessing prospective service providers is an important way to ensure you are choosing the right HR provider. You might create a formal request for proposal (RFP), but at the very least you will want a tailored checklist of important features and qualities that your business wants and needs. This eGuide will walk you through the most important considerations to include in your organization’s selection process.

First, Narrow the Field

An essential first step in finding an HR provider is identifying the experience, expertise and mix of services that meet the distinct needs of your particular business. Looking for those attributes up front can help you narrow your search to those organizations worth pursuing. TriNet’s Comparison eGuide delves into these attributes in more detail, but in brief, you should consider the following:

Experience: Can the service provider document its operational history and years in business? Is that experience relevant for the needs you are seeking to fill? Any reputable HR provider should be able to offer client references who can speak to how the service provider applies its experience to pressing HR problems.

Expertise: Do the HR service provider’s offerings and personnel align with your size, industry and the geographies where you work? Can the service provider demonstrate that it has a system and expert resources available to answer questions quickly and to provide strategic guidance? Expertise you might want to see demonstrated could include:

a. Employee onboarding and orientation

b. Benefits funding guidance and strategy

c. An employee resource center

d. The ability to do an HR compliance best practices review

e. The ability to conduct a human capital assessment

f. Support for hiring and terminations

g. Assistance with reporting and analytics

h. Guidance on company policies, including paid time off (PTO), leave policy, work from home and more

i. Recruitment and interview training

j. Employment claims guidance and support

k. Understanding and experience with companies in your industry and of comparable size.

3. Services:

Does the provider offer the services you will need for today and tomorrow? This is important, not only because it can be disruptive to sporadically add vendors or to manage multiple vendors, but also because choosing a service provider should be considered an investment that must continue to deliver returns over time. With this in mind, the next sections of this eGuide discuss the services you might want to consider. It is not a comprehensive list, but it will help you to think about the essential items that apply to your business needs and, therefore, belong in your RFP checklist.

PAYROLL PROCESSING

Payroll processing is a typical starting point, but some organizations are limited to offering just the first few of the services in the list below. TriNet is one of the few that can offer the entire list, with many of the additional items bringing considerable value, often at no additional cost.