However, several factors are responsible for determining when this function should be outsourced
Size of company: Small companies or companies which have less than 75 to 80 employees or so should undertake outsourcing as they rarely have an in-house HR team. Outsourcing helps them to get the best of HR as a function within the organization.
Cost of the outsourced service: The cost of outsourcing the HR services and the benefits obtained and how much does that affect the overall profitability will also determine when it should be outsourced.
Lack of technical expertise: Sometimes companies may not have in-house technical expertise within the HR department. In today’s world, where technology is moving at a high pace, effective use of technology can be made by hiring an HR consultancy with the required expertise.
Compliance Issues: Outsourcing HR Services to companies providing HR solutions in Mumbai also helps companies overcome problems related to compliance of employee rules and regulations. Companies may not necessarily be equipped to tackle these issues and hence would be happy to find one with the consultancy.
Curb Overhead Costs: When the company needs to curb its overhead costs and use the funds for focusing on the core business, the practice of outsourcing the HR function steps in.
The company may internally feel a loss of control while outsourcing the HR activities, but in the long run it will help the company to grow.