Time to outsource?

Deciding to outsource a function as essential as HR could be risky, but a phased approach could be the key to reaping the benefits.

By Kehrela Hodkinson, principle of Hodkinson Law Group

As a small firm of American attorneys based in London, we have been practising US immigration and nationality law for a number of years. The partnership was reorganised in October 2005 and we are now looking for growth in the business.

Since our inception, we have primarily concentrated on serving US and British corporate and individual clients, and have provided local knowledge and expertise with respect to consular visa processing at the US Embassy in London. There are currently seven of us in the team – a mix of Americans and British. One of our attorneys works remotely from California.

The firm represents large and small multinational companies, partnerships and individuals with respect to all aspects of their immigration needs.

This includes non-immigrant visa petitions, applications for immigrant visas, and advice regarding waivers of inadmissibility for non-immigrant and immigrant visas. We also provide advice relating to maintaining permanent resident status and the acquisition and loss of US citizenship and expatriation issues.

As such the people we employ need to be very sensitive to the business needs of our corporate and individual clients, and have a range of skills and personal characteristics including excellent listening skills, empathy and attention to detail. This is important because we are dealing with individuals during a major life change and practising in an area of law that is very forms intensive.

I believe human resources (HR) will play a key role in supporting and sustaining future growth in the business.

Effective HR will not lead that growth, but it will certainly complement it. It is important that the function can grow as we do – that is easy to manage with an outsourced operation. For instance, it will be busier with recruitment as the firm expands. And, while our HR policies work for us as a smaller firm, we need to ensure they continue to be appropriate as we continue to grow.

We have been outsourcing all of our HR requirements for a year now and I certainly would not go back to performing the function myself. I do not have the time or the expertise to do it in house.

It makes much more sense for me to spend my time doing what I am best at, which is practising law. It is a much more efficient use of my time to outsource the process and the results are better. A knowledgeable HR generalist is able to assist with problems as they arise, inform us, and develop our processes and systems in line with HR best practice.

Such expertise also encourages us to think strategically about employee development and retention. For instance, I have been able to investigate the benefits of using psychometric testing in recruitment and staff development. This is something I could not have explored without professional help. As well as ensuring we are recruiting people with the right skills, I also hope to be able to use psychometric tests to build our team working. We can use them to look at how people think and work together.

If I understand people better, I can approach them differently and get better results.We have a quarterly retainer with an HR firm – a really flexible approach that meets my needs. It means there is always someone I can call when an issue arises.

Sometimes I speak to my HR support daily, other times I might not ring for months. I call about the issues I cannot resolve myself, and also when I have a recruitment need. I can either ask for advice on a particular situation – I tend to use them a lot as a sounding board when something is not quite working or else they will step in and talk directly to the employee to resolve a problem.

That happened recently when they spoke to the employee regarding unsatisfactory work and behaviour. I just had not been able to get through to the employee. It really helps having permanent support as employees know them and see them as the HR function from the beginning of the employment relationship. I also had an employment tribunal earlier in the year and they managed the process, collated the documentation and provided representation. This again meant that I was able to focus on my core business, knowing that HR matters were being dealt with.

Although I am now outsourcing all of the HR function, I did not outsource all of my HR in one go. Up until three years ago the firm managed everything in house. It got to the point where we needed to recruit – I was looking for a business administrator at the time. There were three options: use an agency, which would give us whoever happened to be on their books; advertise and be inundated with CVs from people who were not qualified for the job; or outsource to someone who had our best interests at heart.

I decided to look at using an HR specialist to handle the process but I still had doubts. Would the person understand our needs and what we were looking for? I needed to be sure they would find the person that we wanted, not the person they thought we wanted. I needed someone who would understand my needs and way of operating.

I found a supplier who was superb at going through the recruitment process and understanding our requirements. She had come from a broadcasting environment rather than a legal background, but as we are a firm practising US law in the UK our requirements are atypical to a regular UK law firm and I did not see that as a problem. Someone with a UK legal background might have approached things in a way that was not suitable.

She spent a lot of time with us and came up with a job spec – the first time I had done that and that gave me a lot of confidence. I found the process really worked for me and it was quite a bit cheaper – so after that it was a ‘no brainer’ to outsource future recruitment.

When I had further recruitment needs the first consultant recommended me to our current supplier. Again, the remit was initially strictly recruitment and the new firm was able to add a lot to that process.

The HR firm reviews all the CVs, which means I only see the three or four people most qualified for the position. That has saved the firm a huge amount of time and energy. I also have much more confidence that I have recruited the right person. When I began working with the HR firm, they would send me a few CVs at the first stage to ensure we were on the same page. But now I know we are on the same wavelength that is not as critical.

When the firm sees the candidates we now do more than just an interview. We do two different exercises that have been especially devised for us. An in-tray exercise enables us to identify thought processes in relation to prioritising and organising workloads, and a group exercise enables us to observe communication skills, influencing abilities and interaction in a team environment.

They were devised by reviewing the person specification for the job, and combining this with the needs from the job description. These are good ways to explore different parts of the individual’s personality and skills. An interview can be so artificial.

Outsourcing other HR requirements to the firm was a logical step. I was interested when I heard about the range of services they offered as I had a number of HR tasks I had been putting off. I started using them on a project-by-project basis to review and update my HR documentation. They began by rewriting my contract of employment and then created an employee handbook for me. These were tasks I knew I needed to do, but there had always been other more pressing things that seemed to take priority.

The decision to outsource the whole function was another natural progression. It was important to me that the firm had been recommended and I really liked its sensitive and professional manner. Working with them on recruitment and then moving onto specific projects was a great way to check that I was happy with the firm and what they could offer.

Outsourcing for small and medium-sized law firms with no HR department certainly makes a lot of sense. It really pays to have someone expert doing such an important job. If I were to advise another firm about outsourcing I would definitely recommend starting on a project basis – for instance a recruitment drive.

It is very much about having the right relationship with the provider and feeling comfortable with them and confident that they understand your needs.

First of all ask yourself if this is someone you would want in your office. Do they fit with the firm? They have to fit who you are and what you are. Once you have got the right person for your team, the fact that they work outside of the office is a real benefit as you do not have to cover all of the overheads of having someone in-house.

Kehrela Hodkinson is principle of Hodkinson Law Group. She can be contacted at khodkinson@usvisalg.com