HR Isn't Important For Small Companies... Right?

It's a sentiment shared by many as they make their first foray into launching a new venture. Sadly, at the stage where your entire focus should be on developing your company, a flood of forms, registrations and insurance policies vie for your attention. Business owners are quickly consumed by tasks and responsibilities that are a far cry from what they had expected. This often gets delegated to the office manager who must contend with making sense of the thousands of complex labor regulations in addition to looking after the daily operations of the company.

The average business with less than 100 employees will have about 3 HR personnel on staff, costing about $60-$70k in total compensation each. If you've just received your Series A funding, you may want to think twice before dropping nearly a quarter million of it on HR. A much more cost effective alternative would involve hiring an outsourced HR solution, because even though it would allocate specialized staff to your business, it doesn't penalize you for staff downtime between HR events, like benefits enrollment and new hire onboarding. In my next posting, I'll go over some choices for outsourced HR and talk about how you can find one that's a good fit for your company.