Strategy #3: Reducing HR Costs
Many companies still haven’t transformed their HR area to reduce costs and improve support to the business. Cost reductions of 25% are possible and the change in HR from administrative transaction processor to business partner significantly helps line managers.
- Examine the possibility of self-insuring benefits such as dental or optical coverage.
- Consolidate human resource or training functions in the field where appropriate.
- Streamline HR processes and procedures such as the approval process for hiring, transfers, and performance appraisals.
- Employee performance appraisals are generally more effective and less time-consuming if held on a quarterly or semi-annual basis, rather than annually.
- Reduce duplicate paperwork, data input, and manuals.
- Automate HR functions via internet applications, for example benefit enrollments.
- Push more responsibility onto vendors.
- Renegotiate vendor contracts.
- Outsource selected HR functions such a payroll, benefits administration, training, or recruitment.
- Restructure HR to provide new challenges and improve efficiencies through new HR staff performance goals and accountabilities.
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