ContributorsMulti-process HRSourcing

EDITOR’S NOTE: Paying for A Road Less Traveled

New Jersey is home to HRO Today’s editor and seemingly endless number of toll booths. If state politicians in the Garden State could muster the same courage that HRO buyers have exhibited, New Jerseyans could carry less change around.

by Andy Teng

Anyone who’s ever driven through New Jersey, my home state, will immediately realize two things: it rightly deserves the title of being the most densely populated state in the union, given all the traffic on the road; and you’d better carry a lot of change because you’re driving through the toll-road capital of the world.

New Jersey’s two main arteries are the Garden State Parkway and the famous New Jersey Turnpike, both costly thoroughfares to travel on. And even if you want to get out of the state, get ready to pony up bucks. The George Washington Bridge and the Lincoln and Holland tunnels to New York City will set you back as much as $6 each. To the south, the Delaware Memorial Bridge costs $3. To the west, the Walt Whitman and Ben Franklin bridges cost $3 to cross. Hey, welcome to the Garden State. Now pay your tolls and get out.

Now comes word that the state is actually considering imposing tolls on more of our major highways to help relieve property taxes. As a homeowner and a commuter, I’m not sure where I stand on this scheme, but it seems like our political leaders are missing the bigger picture that you, I, and many business leaders seem to get.

Outsourcing’s big payback is lower HR costs. The crucial axiom of HRO and shared services is that centralized and standardized services produces saving. That’s why you and hundreds of other companies engage in outsourcing and shared services. If a business case didn’t exist, the HRO industry wouldn’t exist.

Here’s the problem with my home state: we don’t get outsourcing or shared services. As one of the smallest states in the union, New Jersey has one of the highest number of local governments. Believe it or not, it boasts 567 municipalities supporting a population of 8.7 million. By comparison, Illinois has 364 municipalities with a population of 12.7 million; Texas has a population of 22.8 million in 455 cities; and California, the most populous state in the nation, has 1,232 municipalities with a population of 36.1 million.

By geographic size, New Jersey doesn’t come close to the others. It is 7,417 square miles in size; Illinois is 55,593; California is 163,267; and Texas (second to Alaska in the nation, trivia fans) is 268,581.

Having so many municipalities in such a small state means many local governments, departments, boards, employees, etc. You can imagine the level of redundancy. Why do we New Jerseyans tolerate such governmental waste?

A few years ago, my town explored what has become the third rail of local politics—consolidating services with other towns. This quickly became a lesson on how not to get reelected in New Jersey. The mere suggestion of merging the local police with that of another town or the county led to near riots at the municipal council meetings. Home rule, as it turns out, was a priority like no other. You could take these people’s children away before they’ll let you take away the local cops.

This mentality also pervades the workplaces of many organizations today. Employees continue to be wholly resistant to outsourced HR services, preferring to have traditional on-site, in-person service. It’s understandable. But HRO is not the immature wreck that it was a few years ago. Providers have sharpened their skills, pricing has dropped significantly, and delivery and service quality have risen. In some cases, outsourcing provides better delivery and more bells and whistles than what some buyers can achieve on their own.

Outsourcing never makes it out of the exploratory stages at some organizations because it is shot down by business leaders worried about losing control. Their reasoning also stems from—rightly so—concerns about how employees react to such news. But times like these call for effective leaders to shepherd the masses down the right path. HRO may be an inconvenience during the transition, but the end results will be a more efficient and effective HR.

Unfortunately, political leaders lack this courage, and we in New Jersey understand the consequences of not tackling the root problems of our tax issues: keeping loose change in the car everywhere we go.

Tags: Contributors, Multi-process HR, Sourcing

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