HR functions that you could externalise

The daily routine of an entrepeneur it’s hard enough to deal with some of the admin tasks that imply having your HR related tasks in order and therefore, to be able to prevent most of your problems or to solve them efficiently when they come. This article will help you to decide whether if you could outsource some of your HR functions.

However, as we said, it is complicated to manage the business on the day to day basis and also to be in charge of all the admin tasks.

If you have more than 5 employees, it is very probable that you are not investing time on any specific task. It is very probable that you are more into the managerial side of business. If you are not, please reconsider this, money its not an excuse, you need to be managing the business, not being your own employee.

I am sure that when you first started your company, the vision was NOT “I want to be managing my employee’s absences, holidays and payroll”. Am I wrong?

That is why we want to give you the chance to review what it is done right now in your company that could be externalise and be done by someone who knows better about the topic than you do and it is not central to your business, I mean, it is not what you sell.

HR Functions that you could Outsource

On our post about the HR Functions, there are plenty of them that you could give away to another SME and have more time to do what you need to do. SELL, SELL, SELL, and then control that everything is going well and as planned.

I am not going to say that being an entrepeneur it’s easy, because its not. Being an entrepeneur means that you only worry about money and taking care of your project. This will take about 16 hours per day on your first years. Don’t get me wrong, it doesn’t finish, usually entrepeneurs decide to dedicate less hours so they can have a live, but they could still do 16 hours per day.

To reduce those 16 hours per day to 8, you need to give things away, its pure maths. What are the things where it really doesn’t matter if you are doing them or it’s someone in an office accross the street or someone abroad working from home?

What are those HR areas that you could externalise?

HR Administration / Personnel

All the related to Service Delivery and Information; payroll, contracts and absence management (sickness, holiday, etc..)

There are thousands of small tax agencies that will do your payroll for you. It is most probable that you have someone already doing your accounts and taxes externally. If they are not doing payroll, please do not hesitate to give it to them. It will not add that much to their budget.

Holiday and absence management:

I will not write much about this now as I want to leave it for a later post, but it is important that you know that there are plenty of technical solutions that will keep this organised and registered so you don’t have to rely in horrible calendars or spreadsheets that could be deleted without any logs for you to review when conflict comes.


Once you have followed the steps to analyse what you need, the budget you have and the how the first 3 months of that new person will be and how it will affect the other members of the staff, you will probably have a job and an spec description for the role and the profile you are looking for.

How long is it going to take you to do a good recruitment process and how is it going to take part of your time? Do you have that time? Do you know how to do good interviews? Will you be able to find within time the right person for you within your budget?

If you have the time, know how to do interviews (properly) and you believe you will do it before you don’t need the role anymore… please do it yourself. If not, it may be good to contact a couple of agencies. Most of them work on success. That means that if you don’t find the right person, they will NOT invoice you.

All the others HR Functions, specially if you are rather small, we would recommend that you keep them in house or look for external porviders on ad hoc basis for specific projects, but make sure whatever it has to be with Organisational design, Training analysis, Employee relations, and Performance and reward plans are close to your line of management so this actions are aligned with your objectives.

If you are bigger, you could always externalise the role of a HR Manager or hire someone that could do everything for you. On the meantime, keep reading us for more advice on HR related topics.

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