So, you’re an employer. You need HR expertise. The board or CEO cannot continue to manage the HR function because we all know this brings its fair share of issues (one major one being no knowledge of HR and employment laws!) Employees seem to be lacking in performance, attendance is at an all time low, and you are just not sure you are getting your moneys worth on the salaries you pay. Let’s be honest, salaries are, if not the largest, then one of the largest overheads of any business, regardless of its size or industry.
Now, there is good news and bad news. The good news is that you know a HR function will be the key driver of change in the business, you know that this will enable high performance in the workplace and in turn, increased employee and client retention resulting in higher revenue and better reputation. The bad news is that there are so many HR providers on the market, so how do you choose the right one? HR Habitat is giving you a head start by sharing some vital questions you should be asking before partnering up with your new HR consultancy.
The value of HR
Let us start by understanding the value of a HR function in any business. The Human Resources function is a niche area of expertise/qualifications that produces various people strategies. It works with the business and its key stakeholders to protect the business from unlawful people management (to avoid claims being brought against them) and to also encourage a high performance working environment. HR is skilled in understanding what talent a business requires to fulfil a company objective and how to drive this through its current workforce. HR is responsible for effectively managing disciplinaries and grievances, for e.g., to avoid conflict in the workplace. Another huge factor is that a HR professional will usually be privy to budget information for the business which allows it to lawfully carry out development and training plans as well as carrying out down-scaling projects such as redundancies. It applies practices to adapt to the current economic environment.
Risks of no HR in the business
So, imagine a business without all of this. Firstly, there is heightened risk of mismanagement of employment matters such as mishandling of grievances or terminations which can land an employer in an Employment Tribunal. Unfair dismissal claim compensation can see thousands in payout, while discrimination claim compensation awards can go into the millions! Next, let us think about talent. It is not about hiring per se, but it is about understanding the skills gap in the workplace. You may have an employee who brings no value to the organisation (whether a direct impact to the revenue or not) and you may have others who are reliable and able, and therefore, have scope to be trained into higher positions. A HR consultant will be able to produce a development plan with key outputs and KPI in a succession plan which may save you from having to hire another employee, saving you thousands each year. Now lets imagine a disciplinary issue, it gets sticky. As an MD or CEO or Director, are you comfortable and knowledgeable enough to navigate these proceedings? Are you aware of the ‘Do’s’ and ‘Dont’s’ of these conversations to avoid being accused of discrimination or unfair treatment? Our advice is, PLEASE do not attempt these. We have seen one too many go sour and often it is too late to undo the mess. In addition, understanding budgets from a Directors view is far different to how a HR professional approaches budgets. Both views are vital to make important informed decisions on the business’s spend. A HR consultant will be able to provide key insight on the value or return of company spend and provide a forecasted summary of the critical impacts of budgets.
With all of the above in mind, here are 5 questions you should ask a HR provider before you partner with them.
Q1. Can you give me a case study of an employer you have worked with and what you provided them?
This is an important one because the proof is in the pudding. A testimonial is great, but an actual case study of the HR projects delivered and metrics of the employee issues will really be a game changer. In fact, we would go as far as saying, if you are only going to ask one question, let it be this one.
Q2. What level of services might I receive for each price plan?
Every consultancy has a certain way of pricing for their services. HR Habitat is proud to say ours is unique – we promise.
Usually, you will be asked of your employee head count and then provided a quote. The HR company may not ask any further questions on your needs, what their views are, any professional insights, etc. At HR Habitat, while headcount is a considered factor, it is not the deciding element for our pricing. We have 3 simple models, ranked in tiers. Tier 1 offering the fundamentals and our cheapest plan, Tier 2 offering advisory HR while Tier 3 delivers very strategic HR. The key differentiator is the level of HR expertise you receive. We have micro firms who have opted for our top level bespoke Tier 3 solution and various size businesses engaged in a Tier 2 mid range solution. Is it making sense now why we must ask the question around what you might receive for the price you pay? You want to get your moneys worth or else even the cheapest package will hold no value as you will just be another number on the client spreadsheet.
Q3. Why are you different to other HR consultancy firms?
It seems so many HR firms are popping up into the scene with no real differentiator or USP. Although ‘different’ is not exactly what you are looking for, speak to a few consultancies and understand what sets the apart. This information will be key to you and your business and you will start to see the ‘differentiator’ is the factor your business needed the entire time.
To put this into context, let us say you are shopping around for a new internet broadband. There are hundreds on the market, each with different price points and varying connection strengths – yet all of these companies have thousands of customers, regardless of they type of broadband they are offering. You may not be sure exactly what you are looking for, but you know you want fast internet connection. You narrow your search down to two suitable options, two different companies. One provides amazing customer service with on demand calls, 24/7 messaging service, a friendly technical troubleshooting department and of course brilliant internet connection. The other also has brilliant internet connection. Which are you like to purchase, the latter, or the former? Likely the former due to its differentiator of excellent customer service with of course, the great internet connection. Having just the fast internet is clearly not enough. You want the fast internet but with an entire services package or else you will quickly lose interest and will continually be open to researching other providers.
This is similar to a HR provider. Of course, all HR consultancies know ‘how to HR’ (or should), but what else do they bring to the table? Can they respond fast, do they have expert knowledge of the law, do they work with businesses similar to yours? Find that additional value and you will never go wrong with your decision. FYI, we love being asked this question, it is a chance to show off – and we are unapologetic about it.
Q4. What are your personal company values?
This is not related to the services directly but still an important question to ask a HR provider before partnering with them. It allows you to understand their business and its objectives to ensure you can get on board. This is a company’s story, their ‘why’, and often allows for a great business relationship when two parties are aligned with each others wider objectives. You want to hear great things here such as ‘to close the gap in female leadership’ or ‘to encourage inclusive workplaces’. Think about what yours are before asking this question to a HR firm.
Q5. What areas of HR is not covered in your services?
This is often in the small print of an agreement, and if you are like the masses and skim past these, you will be in for a shock when your new HR provider tells you that your issue is not covered in the agreement. Yikes. Do not wait to read a contract of service, instead, ask this question ahead of time. You can simply ask what is included in the services and what is excluded, and why. Trust us, it will save you hassle and money in the long run.
We would love for you to ask us these questions, and more. Our approach to HR is unique, not just because of our pricing models as explained above, but also due to the offering itself. Book a call here to find out, you can also request a quote online in less than 15 seconds.
