UK companies wasting 'billions' by not outsourcing HR

UK companies are wasting billions of pounds each year through key HR staff spending valuable time on day-to-day tasks that could easily be outsourced freeing them to work on more strategic company issues.

Research carried out on behalf of Northgate Information Solutions reveals that HR staff in small to medium sized companies, those with between 400 to 1,250 staff, spend 40% of their time, up to three days a week, administering and managing day-to-day HR functions.

This compares with 35% of time spent on the same functions in larger companies with up to 10,000 staff. Added to this around a tenth of HR staff time in companies of all sizes is spent on specific training to keep up-to-date with statutory regulations.

Northgate claim that with HR staff spending around half their working week just keeping up to date with admin and legislation this is costing the average small to medium business £94,000 a year - across the UK this equates to an estimated £1.4 billion. In larger companies Northgate say that around £658,000 could be saved each year by outsourcing basic HR functions – in all as much as £1 billion.

Malcolm Aldis, Managing Director of the HR Division at Northgate Information Solutions, said: "HR is more and more recognised as being a strategic function within a company. But despite this, valuable HR time is being taken up with very basic HR functions that could so easily be handed over to an outside company.

"It's set to get worse as even more red tape, directives and legislation is expected. So, any measure a company can take to free its HR staff from mundane and time consuming tasks would really affect the bottom line.

"In addition, senior managers need to be aware of the less tangible benefits such as the competitive advantage that could be gained as a result of HR staff using this valuable time in a more productive and strategic way."

Northgate IS delivers bespoke front office solutions for UK businesses, aimed at increasing business process efficiency through the use of technology, in commercial and public markets.

Northgate's ResourceLink HR solution enables organisations to deliver a dynamic single view of their employees.

The company has a client base of more than 250 in the HR, Payroll and Pensions arena and was the first to market in the UK with a fully integrated and web-enabled HR solution - ResourceLink, a solution designed for the new generation of HR professionals.

(SP)