Top-quartile organizations globally have learnt to channel their best resources to those aspects of their business where they possess competitive advantage. To act otherwise is not only counter-productive but a sure way to underutilise resources and ultimately undermine business results. One attribute that separates leading organizations from the pack in various industries is their ability to not only identify the areas that are critical to their overall growth and profitability but also to direct the right amount (in terms of quality and quantity) of resources to such areas. Such brilliant organizations have learnt over time to outsource their manpower especially the non-core business functions to outsourcing firms who have the expertise and experience to effectively manage same.
In this context, manpower outsourcing (also referred to as personnel outsourcing) involves the strategic use of an external/third party organization to manage selected employees in various mostly non-core functions. The outsourcing company bears the full responsibility of managing the outsourced staff in collaboration with the client based on agreed terms between both parties. Interestingly, manpower outsourcing is a staffing model that is very effective for organizations who want to relieve themselves of the often perceived burden of managing a very large workforce. Organizations that lack the in-house capabilities to manage their employees also adopt the manpower outsourcing model to enable them gain efficiency and focus on their core business.
In addition to the above, we will examine three critical benefits of adopting the manpower outsourcing model especially to organizations who lack the in-house capability to manage a large workforce and need to focus on their core business. The three (3) critical benefits of manpower outsourcing include:
- Focus on core business: This is perhaps the greatest advantage of manpower outsourcing to any organization as it enables organizations invest their time and resources on high-impact activities that are critical to their growth and profitability. It’s no secret that managing human resources effectively can be a very daunting task for most organizations especially in the absence of experienced HR professionals (in-house). Leading organizations in various industries have learnt over the years that a profitable solution to this age-long challenge is manpower outsourcing. Smart organizational leaders are conscious of the key capabilities of their organizations. Hence, they continuously leverage on these capabilities while they outsource other functions for which they have no expertise and experience.
- Efficient management of employees: Well-structured manpower outsourcing firms have the talent and capabilities needed to manage a large number of employees across various levels, functional areas and industries. Such outsourcing firms typically have well-trained and experienced employees who have the requisite competencies needed to handle the end-to-end process of staff management including processes such as Recruitment, Payroll Management, Performance Management, Learning and Development, Exit Management, Employee Relations Management and more which most other organizations lack for obvious reasons. Hence, the need to focus on their core responsibilities. For organizations that lack the in-house capabilities to manage a large workforce outsourcing their manpower becomes a strategic and viable solution.
- Cost Savings: Overhead costs typically form a major part of the overall budget for most organizations not only in financial terms but also man-hours. Therefore, organizations that outsource their manpower to professional outsourcing firms tend to save a lot in financial terms. This further implies that manpower outsourcing is a strategic solution to significantly reduce the overhead cost and also reduce man-hours thereby enabling the organization focus on those aspects of the business that are most important for its long-term profitability and overall growth. If done properly, organizations can save several hundreds of millions by outsourcing their manpower to the right professional outsourcing firm(s).
Getting manpower outsourcing right.
Organizations must ensure that they carry out an in-depth verification exercise before engaging outsourcing firms to ensure that such firms have the right capabilities to effectively manage their manpower for best results. Proper service level agreements must be drafted and signed-off to ensure all parties involved are clear on their expectations and deliverables. Key success factors must be spelt out explicitly so both parties can measure the effectiveness of the service rendered by the outsourcing firm.
It is apparent that outsourcing (if done properly) has a significant (positive) impact on the overall performance of the business and the benefits of outsourcing far out-weigh its cost(s). Done effectively, outsourcing will enable organizations focus on their core business, increase profitability and save cost significantly.
Are you overwhelmed trying to manage your workforce? Is managing your workforce shifting your focus away from your core business? Are you spending too much on overhead costs? If your answer to any of these questions is yes, then you need HELP!!!!
Contact Kennedia Consulting today to help you manage your manpower. We are well-known in the industry as one of the most cost-effective and efficient manpower outsourcing firms in Nigeria. We have a team of well-trained and experienced professionals to lift this burden off your team. We are happy to help your business grow.