Human resource consultants provide solid tools for management to use in executing their human resource management plan, outsourced Human Resource specialists provide the same information and are committed to execution.
The fundamentals of leadership and the related people skills are usually well developed with most senior managers, and for small businesses, this is often enough “human resource management” to get the business going and functioning to a high standard. With success comes scale and complexity, and a little later, the need for systematic human resource management. The need is usually driven by a ‘sudden’ problem, an unfair dismissal or under payment claim, an unsigned contract, a disgruntled employee, a non-performer needing performance management or the like. Suddenly the whole management team is involved, each trying to solve the problem and get a return to normalcy. It is then apparent the business has out grown the adhoc human resource management system and needs something more or risk wasting more senior management time on petty issues.
At this point many companies bring in the business consultants to help them with their management issues. Management consultants bring a lot of knowledge and ideas, they can help set the organisational structure, determine decision making, work on strategic plans and in some cases providing coaching for senior execs. They bring and offer a lot of valuable tools to the company management, however, it is up to management to implement and execute the ideas or policy. It is usually the same when the company engages a human resource consultant, they will provide policy, advice, templates, ideas, best practice theory and structure, but at the end of the day, the existing management team is still responsible to make it all work. This extra layer of work is usually in addition to existing responsibilities.
Another alternative is to outsource the human resource management function. The major difference from HR consulting is that the outsourcing company takes responsibility for the entire human resource management function. A dedicated HR manager partners with the management team to determine the business needs and resultant HR needs, then commits to establishing, implementing and managing over the long term, the entire human resource operation. While the on-site HR manager will seek advice and support from specialists in the company, it is the on-site HR manager that will be ultimately responsible for executing agreed plans.