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10 things to consider when choosing a HR supplier

Employment Law & HR
BG Purple

Note: this article was first written by our colleagues at Solve HR, before Solve HR joined Law At Work in March 2020. We have imported this...

As an HR and Employment Law Consultancy, we're often asked to speak with prospective Clients who are 'beauty parading' a number of HR consultancies before deciding on the right one for them. Often, what happens though is much like when you love all the things on a restaurant menu or try too many beautiful fragrances in a local department store - they can't decide! They see that there are differences - style and approach to managing HR dilemmas, culture fit with their business or even just plain old fashioned price, but most of the time, the consultancies offerings merge into one and they just can't determine what consultancy would best meet their needs. Sound familiar? If you are scratching your head trying to decide what provider is right for you, we're here to help! Here are our top ten things to consider when choosing and using your HR supplier - no bias - promise! Know what your HR needs are Are you a small start up business with one employee or a more established SME with a number of staff? It's very common in today's fast paced marketplace that businesses can grow at a rapid rate and often, what worked for you as a start up, can quickly become out of date. Therefore, when choosing your HR supplier, you need to be really clear on what your HR needs are today and what they are likely to be tomorrow and choose an HR supplier that is flexible and skilled enough to deliver both. Do you want a call centre or IT solution that you can contact/use 24/7 or do you want a face to face solution? Do you want to be sent templates to complete or letters prepared for you and ready to send? Do you want only the Directors of the business to liaise with your HR supplier or do you have managers that require HR support also. By establishing your current and future needs, you will be more prepared for any supplier meetings and may even be able to de select potential suppliers just by looking at their website! Evaluate their expertise How many times have we gone into businesses where the owner tells us that they have the HR basics covered, contracts of employment, employee handbooks, absence management etc. Sometimes of course this is all there and more and is a great foundation for advanced HR strategy and practice, but often, when we review these documents, they are at best ill thought out or at worst out of date legally. This leaves the business and its Directors exposed to legal risk. It pays to check who you are partnering with in advance - how long has the consultancy been in business? What's their operational structure? Who will be dealing with your issues on a day to day basis and what are their qualifications? How often will the supplier update your paperwork and ensure that it complies with legislation? Can they carry out small and larger scale change projects? Have they ever been to a tribunal? These and many other questions will soon tell you about the credibility of your supplier and their expertise. Eye up the competition No business owner has time to meet with every HR supplier that's out there; however, once you have established your needs, you can quickly pick which suppliers you want to meet with. Our advice would be to keep those meeting numbers low - maximum three potential suppliers. Any more and your head will be swimming with choice and you will be left in the scenario of not knowing who to choose for the best. Establish if there's a culture match Now you have chosen the three suppliers you want to meet with and evaluated their expertise - it's time to look at what kind of business they are. What are the Directors/Business Development Manager like? Are they aloof or down to earth? Do they appreciate your challenges and have empathy with you? Will they work with you as a business partner or are they simply there to get the deal? How do they treat their staff? How long has their team been established? Questions like these really focus the mind on how alike the supplier is in terms of culture and fit and will help you make a better choice What are they offering? HR suppliers can vary in terms of what services they offer and how these are packaged for Clients. It pays to choose a supplier who can be flexible to meet your needs. Sometimes, before you sign up to a retained agreement, you may want to 'try before you buy' and work with your preferred supplier on a small piece of work to confirm that you can work together and that you are happy with their style and approach to dealing with your HR challenges. If a supplier can't offer you this - why not? Retained agreements are great for both Client and supplier, however, if the supplier is the right one for you, they should work with you in a way that makes you feel the most comfortable before signing you up to any longer term commitment. Of course you may want to commence a retained agreement immediately and that's great. Just make sure you are happy with all the terms of the agreement before doing so. What else can you do for me? As your relationship with your HR supplier becomes more of a partnership, you may wish to use them to support other people related processes in your business. Recruitment is a great example of this. Recruitment can be a time and cost drain on your business and it can be a weight off your shoulders to work with a trusted partner to support you in getting it right. However, many HR suppliers don't offer additional services such as Recruitment either as part of their retained agreements or as a stand alone offering. Therefore, it pays to check that your supplier offers the full spectrum of HR activities and has in house expertise in these areas that can help you when you need. Take up References As you would with any new employee, we would always recommend taking professional references before committing to a supplier. If they are as good as they say they are, then they should be able to provide at least 2-3 professional references from businesses, similar to your own, that you can speak to independently and ask any questions that you may have regarding the business as a supplier of professional HR services So what's the deal? Once you have agreed how you will work with your supplier and taken references, you need to review and agree to business terms. As best practice, your preferred supplier should have provided you with a written proposal for the work to be undertaken, including the detailed elements of that work and any related costs. Be sure to clarify what exactly the costs include and exclude e.g. project work and provision of third party services such as Occupational Health Consultations may be charged separately from any retained agreements. Once you have agreed to the proposal, the supplier should follow up with a contract for services. Any contractual agreement should be reviewed by Client and Supplier on an annual basis and should be flexible enough to be revised by both parties as required at that stage. Measuring Success Your HR supplier, should, over time, be able to demonstrate how they are positively impacting on your business. Once you commence working with your supplier, it might be a good idea to sit down and discuss with them how you will, together, ensure a return on investment. Whether it's reduced absence or turnover rates, increased employee satisfaction and engagement, your HR supplier should be able to establish early on how their success can be measured, should you choose to do so Use your HR service! Finally, whilst you may not have HR issues arising daily, it pays to communicate actively with your supplier and discuss with them pro active HR strategies such as engagement, employee communication and involvement and so on. Remember HR is not just about being reactive and fire fighting but getting the most from your people for business benefit. There will always be something to do and your HR supplier should support you in finding the 'magic dust' that will take your business from good to great! Contact Solve today to discuss your needs.

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