Outsourcing HR functions is one way for businesses to manage high intensity workloads, as property developer St. Modwen found.
HR professionals get into the industry because they’re interested in how people interact with one another; they thrive on the emotional connection between people working in teams and at different levels in an organisation.
So, when things do get tough, it can be difficult to remove emotion from challenging decisions.
To overcome this, more and more businesses are investing in outsourced HR functions to enable all people working within a business to focus on its progression and achieving its strategic objectives.
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Choosing an outsourcing partner
Having already reached out to Morson to discuss outsourcing its recruitment, the vast learnings following the UK lockdown and enforced working from home led out HR team to explore the option of outsourcing some of its function.
As a business, St. Modwen is always growing; it’s progressive, fast-paced and as well as regularly hiring new candidates it frequently promotes.
This puts a lot of reliance on the HR team to support line managers with people management and the company experienced continuity challenges if any of the small HR team were ill or on holiday.
Having experiences of poorly managed outsourced HR, namely impersonal service, we were tentative about trying again. Finding the right partner was crucial to the process working.
St. Modwen had already been speaking to Morson about outsourcing its recruitment, so decided to put the question to the team. And while it wasn’t an existing part of the business model, Morson was confident the skills were available in-house to carry out the task.
St. Modwen was open to hearing the pitch and what it received exceeded expectations. There was some serendipity around it all; if the two weren’t already discussing recruitment resourcing, the conversation might never have happened.
HR outsourcing in practice
Katie Winstanley, group head of HR at Morson, said: “It was clear from our first interaction that the values and intrinsic beliefs of our HR experts and the internal team at St. Modwen were very aligned.
“There’s always differences between every organisation, but our priority was ensuring that the employees within the business would feel no disruption in delivery; we needed to be fully embedded with a consistent presence and a persona that matched St. Modwen’s brand.”
Morson was appointed to oversee the employee life cycle, from beginning to end – from onboarding after recruitment, organising company cars and booking people onto the induction programme, to managing holiday requests, administering payroll and overseeing relationships with outside suppliers, including St. Modwen’s legal support and fleet operators.
Morson has built a core St. Modwen team, which is permanently focused on us for 80% of the time.
Team members work on site. If remote, they communicate from a St. Modwen email address. They attend weekly catch-up meetings and are involved in the planning and development of operational improvements, as well as feeding into quarterly reviews for a truly seamless delivery.
All of these activities have service-level agreements (SLAs) assigned, but when Morson applied for the work the KPIs weren’t included in the contract. It was suggested both parties agree SLAs in partnership over a period of time.
Winstanley added: “You can’t work any other way – our approach was sculpted around St. Modwen’s challenges and the solution is fit for purpose rather than off the shelf.
“Having a core team means we are always ‘on’, while they benefit from the beauty of outsourcing during peaks and troughs because we can apply additional resource whenever it’s needed. We’re truly unified, to the extent that some employees don’t even realise the team isn’t an in-house entity.”
Achieving more together
Melissa Hewitt, senior group HR advisor at Morson – who acts as the leading HR interface for St. Modwen – said: “So much has been achieved in such a short space of time.
Primarily, the implementation plan was an example of true collaboration; this wasn’t something St. Modwen had considered for long, and not something we had a team already dedicated to. But we worked together to agree on what was needed and everything went smoothly.
“Once we have a year of our own data under our belt, we’ll be able to spot trends, too. For example, we’ll be able to say, ‘you had a spike of enquiries about annual leave in January, so let’s allocate some resources there to create tutorials on how to book leave through the system quickly and easily’.
“It’s about pre-empting, being smarter while developing a personal relationship with St. Modwen’s employees just as if we were an in-house function. We want them to feel our team prioritises them, and when people are picking up the phone to me rather than their line manager for things like payroll requests, that shows it’s working as it should.”
Looking to the future
Which companies benefit most from outsourcing HR? According to Morson, there are a few key criteria.
Winstanley said: “Outsourcing your HR is particularly effective if a company feels their in-house solution could achieve more. If employees could use their time more effectively, if senior leaders are focusing more on tactical operations than on strategic delivery and if SLAs aren’t being met, these are all indicators that something must change.
“We understand companies have reservations about outsourcing, but we would never take on something if we thought there was a chance we could fail. The HR service is often the beating heart of an organisation, and we want to get that right.
“In the case of St. Modwen, we enforced a three-month trial period of our HR solution ahead of instigating an end-to-end recruitment programme; we wanted to prove ourselves and that move is paying off for us and for them.”
In three years’ time, St. Modwen want the HR service from Morson to be entirely self-sufficient – for it to be so engrained in the business that they’re constantly finding added value, using their knowledge and insight to improve the business.
We have an ambitious people strategy, but outsourcing is helping the company achieve the trajectory it needs to grow exponentially. Any company on a similar path should consider it. If you’re looking into it, go with the company that proves it’s done its research into your business, and be clear on what you want to achieve from the partnership from the outset.
Finally, the importance of the relationship shouldn’t be underestimated. Morson is an extension of St. Modwen, and it’s felt like that since the very first interaction.
Becky Cund is head of HR operations and sustainable people projects at St. Modwen