Are you focusing (enough) on HR in your company?
HR is one of the areas that you, as a company owner, must take into account – sooner or later. Regardless of company size, all companies – from the large international cooperation to the small and local family business – often times we will be met by HR related challenges.
WHEN WILL IT PAY OFF TO HAVE AN HR FUNCTION?
At Accountor, we are often contacted by companies asking us when it will pay off to implement a professional HR function in the company. Generally, we will say ‘the sooner, the better, but especially, when your number of employees reaches around 50, that will often be the salient point where you will have to consider how to integrate HR with the overall strategy. This is naturally a strategic consideration requiring that you have an overview of the HR tasks in the company and depending on whether you have HR behavior in the blood.
Our experience is that it is not until the companies hit 100-150 employees that there is actual / real focus on HR – but at that time, unfortunately, most companies are already way behind in relation to processes, infrastructure, systems, concepts etc. They may be missing an introduction program for newly employed employees, or the organization is suffering from high levels of sickness absence, resulting in overtime work for the remaining employees and the risk of employees leaving within a year, which will have a natural impact on the economy of the company.
Actually, it is estimated that an employee leaving the company within a year after employment, costs the company approximately between DKK 450,000 – DKK 1 million according to employee type.
GET THE HR RESPONSIBILITY AWAY FROM THE MANAGERS
HR is both challenging and resource demanding, but it is also a highly important area to prioritize in order to get a financially profitable and well-functioning work place. Often, HR is included under an administrative position, and the strategic discipline is overlooked. HR, however, is part of most specialist disciplines, including business development, management, organizational changes etc.
Larger companies typically have an HR department managing the tasks; whereas smaller and middle-sized companies often times delegates the work to an internal employee not necessarily having the right HR competencies to do the job. The HR tasks are thus underestimated in relation to the actual scope of the tasks.
HR-partner in Accountor, Helle Ditlefsen, explains:
”When HR is not a top priority, we often see that the operational HR tasks in smaller and middle-sized companies are divided between middle- and top management, both recruitment, development, dismissals etc. These are all time-consuming tasks that takes away focus from day-to-day operations.
In addition, with the lack of a centralized HR function, there will not be a clear connection between the company’s goal and the strategies and goals of the employees.”
Helle Ditlefsen continues:
”Moreover, the companies tend to forget to make a calculation of what it costs to let the middle- and top managers do HR tasks. In relation to payroll costs, it is not expedient to let a person handle tasks, which he or she is not trained to. It is a costly time rate to pay for a piece of work that an educated HR employee is more competent to solve and at a lower time rate. HR is much more than ‘soft values’. It is very much about creating value for the company financially.”
It can be cost-effective to invest in HR assistance on a part- or full time basis to free the resources for middle- and top managers so that they can do what they are employed for and good at. With an educated HR employee, you will get a highly motivated resource who will be able to provide highly qualified sparring and support for management as well as employees in a day-to-day basis. Moreover, a simple calculation will document that investing in an HR employee will increase motivation, job satisfaction, efficiency and not least the turnover of the company."
WHEN THERE IS NOT ENOUGH FUNDS FOR AN HR DEPARTMENT
What do you do when the company size is so that you cannot afford a full-time employee and you do not have the necessary competences and the time to solve the HR tasks internally? It can be difficult to see a solution to the problem – but is actually quite simple.
It only requires that you think out of the box. The HR position does not necessarily need to be filled internally within the company. More and more companies hire or outsource their HR tasks to external HR consultants. According to the specific needs of the company, you can hire external HR consultants on an hourly, daily or weekly basis to take care of HR policies and tasks such as:
- HR strategy: Where do we want to go, and how do we get there?
- HR development: What competences do we have internally and how do
we make best use of it?
- HR tactical: Do you need competences, and how do you attract the right employees?
- HR administration basic: practical work in relation to systems, payroll,
recruitment, policies, employee handbook, handling of contracts, workplace assessment etc.
- HR legal: employment law, collective agreements, working environment etc.
At Accountor, we offer to take care of all HR tasks in the company, or parts of them, depending on the needs in the respective company. In cooperation with the individual company, we tailor a solution that exactly matches the exact HR needs of the company.
GET A FREE GDPR CHECK!
As we all know, the new EU General Data Protection Regulation (GDPR) took effect from May 25, 2018, but if you are still have doubts about how to handle GDPR in practice in relation to HR and payroll, let us help you.
At the moment, we offer a free meeting in which one of our experienced HR consultants will come visit you. In the meeting, you will be able to ask about any GDPR related questions you may have within HR and payroll.