Why are HR professionals turning to opportunities in the outsourcing field? Opportunity to learn a broad array of skills and build client relationships are among key considerations for workers.
The rise of HRO during the past 10 years has not only created a new industry but also new career opportunities for the HR professional. Corporate HR specialists are leaving their longtime, established internal positions in huge numbers for the opportunity to work for an external provider. Sometimes by choices, sometime as a result of an asset sale, many service provider employees have comfortably settled in a career in outsourcing.
To discover what’s behind this trend, we spoke with leading HR specialists in the HRO industry. What they told us was that there are clearly seven factors contributing to the rise of the HRO employee, and we have explored them here.
- Career Diversity and Advancement. Larger corporations have many levels to their hierarchy within the HR department, and very often those departments are broken down among functions. The more compartmentalized the functions become, the more limited the internal HR employee becomes in her role and job mobility. However, when working for an HRO provider, the option to work in multiple lines of business opens up and allows the specialist to be exposed to new and exciting challenges that they otherwise would never experience at an in-house HR department. The HRO employee is afforded the opportunity to explore various resources and partner with different professionals within the industry to help meet the needs of any particular client.
Kim Gladbach, a vice president and account executive at Dallas-based ACS, said that her experience working for an HRO provider has only deepened her HR knowledge.
“Working with an HRO provider has broadened my operational and financial knowledge of HRO as well as exposed me to many other HR practices and processes that I would have never had access to while working with an internal HR organization,” she added.
Because providers put a heavy emphasis on operations, delivery, product development, and marketing, the benefits to an HR professional are that he can participate and learn how to deliver these and many more services to a number of clients. This experience gained within the HRO environment can significantly foster career advancement in several different areas of HR that the professional couldn’t achieve on his own.
- An Opportunity to be a Strategic Partner. Working within an HRO organization provides the immediate opportunity to get away from just working in a facilitating role in a client relationship. An HRO employee has the opportunity to become a valued partner in determining the best solution to meet client needs. “The opportunity to engage more hands-on with a client and become a strategic partner, offering valuable, consultative approaches to determining a solution, is a lot of fun. You get a lot of personal satisfaction from supporting clients so closely,” said Michelle Moylan, HR specialist at payroll vendor CheckPoint HR.
- Learn the Business Side of HR. There are many roles within an HR staff that do not require the specialist to get involved with the profitability of the account. However, when working with a service provider, a specialist must shape not only the service but also how to shape it in a profitable manner. The HRO specialist learns how to deliver quality results for his clients while meeting profitability requirements and any other client quality metrics related to service levels.
“Historically one of the stereotypical views of HR is that they don’t understand the business. At an HR provider, HR is the business, so the ability to be business-focused and financially aware to understand the finances behind it are key,” said Greenbach.
- Access to the Latest Technology and Best Practices. HRO providers use the latest technology available to implement the best practices necessary to meet all client needs and expectations. Many times, the providers have access to tools and technology that a general corporation would never be able to develop in-house. As a result, many HR specialists find great appeal in being able to work with the most-up-to-date resources available in the market.
“I found myself in a situation on the internal side where we didn’t have the money, the technical competency, or the resources to be able to design the tools and the strategies that we needed to be effective. It was frustrating to know that we were so ill-equipped to address our internal HR needs. I wanted to be a part of a solution that we couldn’t provide,” recalled Ashley Gouge, vice president of client development and implementation at RPO provider Pinstripe Talent. “However now that I’ve made the switch to the provider side, I get to work with the latest technology, cutting-edge partners across the country, and strategic thinkers in the business, and I get a lot of professional satisfaction from that.”
- Deep Client Relationships Maintained within an HRO. Many internal HR specialists are loyal to their positions because they have a deep bond with their employee customer. In fact, some would never sacrifice that intimate customer relationship in exchange for a broader scope of work in HRO. However, because many HRO contracts are 5 to 7 years long, with the possibility of indefinite extensions that would help sustain a client-provider relationship, HRO professionals can enjoy the same close collaboration they might experience in an on-staff role.
Shelly Olejniczak, vice president of client services at Pinstripe, said she was initially hesitant to join an HRO. “I really considered myself a very relationship-based person and really liked working very closely with my fellow executives and managers in the traditional HR world. I didn’t want to be in a role where I would be working with an organization for only a short period of time and then have to leave. What I found was that with the length of our partnerships of 1 to 3 years, I was able to have that same level of relationship, which was so important to me and solidified my decision to work for a [provider].”
- Shift from Day-to-day Solutions to Long-term Planning. So much of the HR activities in companies is tactical and time pertinent. However, when you’re charged with such a broad scope of functions in an HRO, the HR specialist must think in terms of continuous improvements in the future in addition to the present. With contracts stretching as far as 5 to 7 years, adopting a long-term philosophy is critical to guaranteeing the success of today as well as tomorrow.
“Working for an HRO, I can work on future strategies for success with the key decision-makers in our customers, not only in HR but at the CFO and CEO levels as well. Before, I would work on mostly the day-to-day crisis that affects an HR leader, but now I also get to focus and influence long-term planning, which was never possible before,” Douge said.
- Ability to Define Relationships. The relationship that an internal HR professional has with the business partners they support is usually based on a close partnership fortified by a common set of expectations. Both sides share the same culture and business goals, making communication seamless. However, the relationship is akin to an arranged marriage: the business partner has the option to neither approve nor reject its choice of an HR partner. However, that’s not the case with an HRO.
According to Arthur Mazor, senior vice president, offering management and marketing, Fidelity HR Services, service providers must earn the trust of their clients.
“When you are in the service provider environment, as an HRO provider or even as a consultant, you have to first engender the confidence of your clients in a bigger way. It’s different than being an HR business partner as part of an organization. You have a steeper mountain to climb to demonstrate your different approaches, depth of expertise, and capabilities necessary to support their business needs.
“You still have to do that as an HR professional, but the difference is you don’t get that client confidence from the moment you walk in the door. You need to work harder upfront to develop trust and build a strong relationship, which requires different strategies and skill sets when you have to face multiple clients.”
All of these factors combined make a career in HRO more challenging and exciting as well, but working on the provider side might not be the best option for all HR specialists. The ideal candidate who can succeed within an HRO is one that can demonstrate
leadership skills, entrepreneurial drive, creative problem-solving, financial awareness, and excellent customer contact skills. While these are all necessary skills for many internal HR positions also, they are more critical to the success of an HRO firm. These are the skills that will foster growth over the time spent within the HRO provider organization and make that employee an even bigger asset to the company, cementing his place within it for the long term.