MedHQ was recently consulted by a colleague about a growing healthcare management company. With over 100+ employees in ten facilities across the Midwest, the management company expects to double by the end of the year and is looking for systems to help manage the growing employee base.

To assist with the growth, the management company is looking for an applicant tracking system (ATS) to assist in tracking candidates throughout the application and interviewing process, as well as a human resources information system (HRIS) to manage offer letters, tax forms, compliance issues and more. In addition to that, the management company will likely transition to larger payroll company by the end of the year.

The question the healthcare management company posed was, “Should we build it, or should we buy it?”

Many companies opt to build the systems themselves because they are unsure if traditional PEOs, long-term staffing companies and HR Outsourcing (HRO) firms in general can resolve all their concerns while also maintaining a high standard of employee satisfaction. However, once a company reaches significant growth, outsourcing day-to-day human resources operations can free up valuable time and resources. Or, on the other hand, perhaps the company has a wonderful HR team internally that helped them get to where they are currently. For either scenario, we could make the case for HRO (“Buy”) instead of investing further in the internal HR function (Build).

If the growth has outpaced the internal operations, an HRO firm delivers an out-of-the-box solution that handles the areas mentioned with technology operated by HR and payroll professionals that have full proficiency in their roles. There are many good ATS and HRIS platforms; at least as important is how they are set up and how well the staff is trained and practiced in using the systems.

For development of an internal HR function, the question is whether it’s best to focus some or any of the executive management attention and capital investment in a support function. What creates value for a company? Likely that it includes developing relationships and delivering top clinical care to more and more patients – these and similar areas is likely what gets executive management’s focus and most capital investment.

At MedHQ we specialize in the healthcare industry, and because of this, can better understand our clients unique HR needs. Currently, we use PrismHR, which happens to be built specifically for the HR outsourcing industry. This system is automating our employee onboarding (paperless), benefits enrollment (paperless) and, of course, handles payroll. We have integrated PrismHR with our time and attendance system and we have an applicant tracking system as well. PrismHR just recently added a CRM capability to its core platform and we’re going through the implementation of that component now – this capability is going to greatly enhance our service to employees through more effective case and task management.

As an HR Services company, we will continue to invest in the best solutions that hit the HR market because these investments will drive value in our company. We find, however, that companies that opt to build internal solutions are susceptible to having those systems atrophy due to lack of ongoing investment.

What an HRO firm is and what it isn’t: HRO’s handle back office matters that are extensive – we break it down to a dozen or so areas and 100 or so separate activities – but almost entirely in a “support” mode. Management (the customer’s management team), on the other hand, is the “front office”. The HRO handles the essential or basic HR functions, while Management supervises and develops the organization. An HR Generalist fits well within the typical service model of a HRO, while an organizational development consultant is best fit within Management Consulting. A HRO’s leverage is its size and risk sharing model. The size creates efficiencies for the customer; the risk sharing removes barriers that get in the way of a customer’s growth.

Lastly, when it comes to culture, we would consider the development of a company’s culture to be the responsibility of the Management team. While we love to work on culture-supportive programs, we believe that for an organization to intentionally create a culture requires top leadership to spearhead the effort.

Interested in learning more about MedHQ’s unique HR services, click here.

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