Little Things Add Up - The Case for Hiring a PEO

Most managers, especially those at the retail store level, already feel overwhelmed at the tasks that they must accomplish every week. It is no secret that district managers spend the bulk of their time ensuring compliance by their store managers. Unfortunately, as more items get added to the “to do” list, it is inevitable that managers will cut corners on some very important processes.

Human resources is one of the prime areas for this corner-cutting to occur. A manager may need to hire someone but, as he is already short-handed, he does not have the time to properly follow the company hiring procedures. Instead he will hire the first “warm body” that walks through the door. The ensuing problems are predictable and, in most cases, significant.


The Tipping Point of Managerial Failure

New employees are not properly trained, do not perform well and cause further problems. As the problems mount, the manager, himself, falls further and further behind and inevitably becomes demoralized. At some point, he reaches a “tipping point” from which he can never recover. The district manager now must terminate this poor manager and the process may even begin at the district level.

It is a significant problem for a large company but they usually have the resources to recover. A certain amount of failure is actually built into their budgets and plans. Smaller companies do not have this luxury however, and must be proactive in meeting this problem.


The Answer Starts in HR…

Employees are the foundation of every company. The bad ones reflect poorly on a company and the good ones are worth their weight in gold. The problem is distinguishing between the two. While there is no secret formula, a well-designed hiring process can weed out the most egregiously bad applicants. Simply put, hiring, training and then keeping the best applicants is the proven way to a solid, motivated workforce.


…and It Ends with a PEO

There is still a problem, however. The best designed plan will not work if it is not properly implemented and executed. Ensuring that the hiring and training process is completed is an equally time consuming practice. In many case the use of a third party vendor is superior to managing the process in-house.

A professional employer organization (PEO) offers the staff and resources to ensure that all company dictated and government mandated procedures take place at all stages the of the HR process. Applicants are thoroughly vetted, new candidates are fully trained and, if circumstances warrant it, unsuitable employees are properly released from employment.

While a PEO most obviously saves time, energy and aggravation by cost-effectively managing your HR process, there are also less apparent benefits. Employee morale and efficiency is generally improved as expectations and responsibilities are clearly defined and there is no culture of favorites as company policy is enforced by an impartial third party. Finally, management is left to do what it does best, focus on the business of the company.


About the Author

Carolyn Sokol writes about issues that may affect small businesses such as HR Outsourcing, Professional Employer Organizations, and HRIS programs. She is founder of and contributor to, both of which help match businesses to the right HR or payroll service provider for their particular needs. Her background is in marketing and communications, employee education and training, development of policies and procedures and the ongoing delivery of outstanding customer service.