What is HR consulting?

Employee requirements are changing, focusing more on flexible work hours, top-notch benefits, and mental health improvements. Human resources professionals must keep up to attract and retain top talent.

The problem is that it’s challenging to stay up to date when industry professionals already have a full plate. That’s why hiring an HR consultant may prove beneficial.

Want to discover the power of HR consulting and see how beneficial it could be for your business? Use this blog as your guide.

What is HR consulting: The role of a human resource consultant

HR consulting—also referred to as human capital advisory or HRM consulting—is receiving information about HR-related functions and benefits from a human resource consultant. HR consulting can cover any number of topics, including policies and procedures, recruiting services, compensation consulting, interim professional placement, HR transformation, and more.

While companies can attempt to manage HR responsibilities on their own, it’s helpful to hire a human resource consultant to partner with certified professionals with years of “been there, done that” expertise. These industry professionals have experience in problem-solving and managing a variety of projects as well as adept at creating efficient HR practices within organizations.

The job responsibilities of a human resource consultant will depend on the clients the individual provides services for, but generally involve:

• Working alongside clients to determine gaps in HR functions and needs
• Partnering with companies to develop, revise, and implement helpful policies
• Creating compensation plans and programs to help clients maintain a competitive edge while retaining talent
• Completing an audit on the client’s current HR services and programs to support compliance with state and federal regulations
• Analyzing data and developing reports for other areas of the organization to better understand HR projects
• Training companies on HR-related topics and best practices
• Helping clients find and recruit talent for their organization

Skills necessary to be a successful human resource consultant

HR departments require a specialist who can navigate the complex world of employee relations, hiring, and HR management. Look for a third-party partner that has these qualifications:

Analytical and problem-solving skills

The most beneficial human resource consultants bring certain skills to their role. These include acute attention to detail and analytical skills to look at HR situations from a different perspective and create beneficial solutions. Collecting and interpreting employee data can provide further insight into what employees need—and want—from their employer. It may also pinpoint the root causes of problems, gaps in employee benefits, and talent management processes that would otherwise have been overlooked. Then, by taking that learned information, human resource consultants can make more informed decisions.

Relationship-building expertise

Because human resources focuses on people, look for a consultant who can establish firm relationships built on trust within the organization and among the company’s clients. Active listening, collaborative working styles, and cooperation with others are critical to creating a work environment where employees thrive. The most effective consultants ask insightful questions, provide constructive feedback, and have a team-oriented mindset when approaching HR tasks. 

Professional and ethical standards

All HR consultants must operate under the ethical and moral standards of the HR industry, meaning respect, privacy, and diversity are among the cornerstones of successful operations. It’s beneficial to choose an HR consultant who will act with honesty, integrity, and responsibility, no matter the situation. It requires continuous development of skills and a desire to learn more about people’s expectations and reactions to workplace problems and solutions.

Certification

Seek an HR consultant who certified, is committed to the industry, has professional standards, and obtains continuing education. This could include being certified by the Society for Human Resources Management as a certified senior professional or a certified professional; certification through the Human Resources Certification Institute as a senior professional in human resources, a professional in human resources or a global professional in human resources; certification through World at Work as a certified compensation professional.  

Why HR consulting? Benefits of hiring an HR consultant 

Strategic HR consulting can leverage a company’s current successful processes while filling gaps and streamlining areas that may be struggling. It ensures each task works together to create a healthy work environment where employees are supported.

Let’s look at a few of the benefits of hiring an HR consultant:

Cost-effectiveness

HR consultants can help you find areas to save money and avoid expensive compliance problems. Additionally, HR consulting supports strengthening work ethics and increasing revenue through improvements in team engagement with clearer guidance and employee resources. Disengaged employees tend to lack the level of productivity necessary to boost a company’s bottom line, which can be detrimental to business income.

Gallup found that disengagement cost the world economies about $7.8 trillion in lost productivity. On top of that, the overall price of disengaged employees in the United States is $450 billion to $500 billion annually, which roughly translates to about $3,400 for every $10,000 in salary. When companies discover ways to improve employee engagement, companies can, quite literally, save millions of dollars.

Compliance and risk management

Doing a people-centered job means adhering to many rules. HR consultants can help align an organization with applicable labor laws, regulations, and industry standards that are constantly evolving and can be difficult to keep track of. The most common noncompliance issues, according to Forbes, include:

• Discriminatory job listings: The U.S. Equal Employment Opportunity Commission prohibits biased hiring practices based on race, color, religion, sex—including pregnancy, sexual orientation, or gender identity—national origin, age, disability, and genetic information.
• Noncompliant interview questions: To avoid prejudiced hiring practices, steer clear of interview queries based on age, plans—including having kids—and other questions that seek this type of information.
• Lack of security: While cybersecurity has been a major concern as of late, protection is necessary for all forms of employee information. Utilize a consistent system for gaining, storing, and sharing data to keep physical and digital insights away from unauthorized access.
• Employee misclassification: A company can hire a wide variety of position types, from independent contractors to freelance workers and regular employees. It matters how people are classified because it impacts their pay, taxes, and benefits.
• Incomplete documentation of eligibility to work: If employees don’t properly fill out a Form I-9 that authorizes them to work in the U.S., then the company that hired them will be liable for penalties and costs associated with this individual.
• Union interference: The National Labor Relations Act (NLRA) states that employers can’t stop employees from organizing a union to bargain for terms and conditions of employment. If team members form a union, the employer must work with them to determine wages, hours, vacation time, insurance, and safety measures.

From educating on risk management best practices and identifying gaps in service to helping with benefits compliance, having a specialist evaluate a company’s employment lifecycle can be a game-changer. They’ll work to provide the most impactful HR processes and functions to improve workflows and company procedures.

Strategic support

Many companies seek an HR consultant to serve as a strategic advisor. A strategic HR consultant can help with large-scale projects that internal staff may not have time to dedicate.  From creating a strategic HR plan to designing incentive compensation programs to a salary administration plan, a strategic HR consultant can help supplement the existing team or serve as an HR leader.  Other strategic programs may include creating new performance appraisal systems, assisting with HR technology workflow design, creating career path programs, and other strategic services designed to add value and advance the business goals and objectives.

Time savings

HR consultants can save companies money by handling time-consuming HR tasks, like developing HR policies, more complex HR scenarios, and managing employee relations. On top of that, these specialists can configure the best possible ways to get things done as efficiently as possible. It enables teams to focus less on small-scale tasks and instead put more energy into goal-oriented initiatives that support the entire organization.

Task optimization

Most companies already have HR processes in place that get the job done, but they may not be the most effective methods. An HR consulting service can audit these existing procedures and find ways to improve them. This can allow an organization’s HR team to accomplish more at the same time, optimizing every task for the best outcomes. With an HR strategy in place, businesses can cut out unnecessary, manual jobs and move processes around until they are organized and structured to fit the company’s specific needs.

Tailor-made solutions

Every business has different requirements for its HR department, so a one-size-fits-all approach doesn’t always work. HR consulting creates human resource management practices that solve specific problems within an organization and find more efficient methods.

Increased employee engagement

There are additional benefits to improving worker involvement and satisfaction on top of improved productivity. Gallup found that, when comparing companies with engaged employees to organizations with disengaged workers, there were significant differences in the following business outcomes:

• 81% in absenteeism
• 64% in safety incidents (accidents)
• 58% in patient safety incidents (mortality and falls)
• 43% in turnover for low-turnover organizations
• 41% in quality (defects)
• 28% in shrinkage (theft)
• 23% in profitability
• 18% in productivity (sales)
• 18% in turnover for high-turnover organizations
• 10% in customer loyalty and engagement

An HR consultant can discover ways to improve employee engagement and job satisfaction, delivering positive outcomes for the company and its workers.

Organizations that may benefit from HR consulting

Whether you’re just beginning the HR consulting discovery process or are sold on this type of solution and are ready to find a partner, it’s important to know you’re picking the right solution for your specific situation.

Marsh McLennan Agency works with different types of organizations to help find more efficient human resource solutions, including (but not limited to):

• Small- to mid-sized companies looking to create detailed and documented hiring practices for the best employee retention
• Non-profit organizations in need of ways to optimize HR costs while still receiving top-notch operational management results
• Companies of any size experiencing compliance issues or seeking risk mitigation
• Large corporations that desire digital transformation within their HR department to align with new technologies and innovations 
• Mature businesses ready to revisit their company culture and reinvent the work environment and employee experience 
• Growing organizations that need improved attraction and retention of qualified candidates

With assistance from our team of HR consulting specialists, we can help you fill operational gaps, meet your hiring needs, and foster ongoing growth and success internally and externally.

Optimize your HR functions

Human resources professionals juggle many operational tasks to ensure businesses continue functioning at maximum efficiency. However, this is difficult without guidance from specialists who understand the industry and can provide helpful resources and recommendations.

We deliver national HR consulting services focused on building your human resources toolkit and furthering your company’s HR capabilities. Our team offers help in these areas:

• Compensation services and total rewards
• Concierge HR outsourcing
• HR compliance and operational reviews
• HR projects, special services, and attorney-led compliance
• “HR On Call” subscription service
• HR transformation
• Interim professional placement
• Talent acquisition

As an HR consulting firm, we can assist with taking employee data and determining what your employees are seeking from their employers. Promote employee and organizational success with our team as your support system.

Reach out to your Marsh McLennan Agency HR consultant today.