Business growth is exhilarating; however, not all growth is made equal. Excessively rapid growth can quickly snap back, leading to collapse, but growing sustainably is a hard balance to achieve. It can be hard to tell whether you are growing at the right pace and that you have the proper systems in place to support your network.
Thankfully, there are ways to help understand your growth and ensure its sustainability.
How PEOs Help You Grow Sustainably
As your business grows, developing the proper amount of HR administration is incredibly challenging. Too little leaves employees unsupported and your HR team overworked. The overworked team then begs for help from other departments, taking attention away from growing the business and causing growth to stagnate. Whereas, too much means overspending for support you don’t require. The best way around this is to partner with a professional employer organization.
So, how do PEOs help?
PEOs Handle HR Responsibility
A PEO handles all the necessary but mundane HR tasks for you and has the expertise needed to scale up as you grow. That means you can have a smaller, tighter HR team who has more time to deal with the complex issues that require intimate knowledge of your company and industry.
It also ensures your employees have the support they need in their work and lives, from easy access to questions about their benefits to conversations about their growth and career development. All of this improves employee satisfaction and significantly improves retention, reducing hiring costs. It increases your chances of being able to promote from within, allowing most of your hiring to be for lower-level positions that are generally easier to fill.
Meanwhile, you will also be in a better position to develop a positive work culture that helps attract and retain top talent. PEOs save you money by reducing compliance errors, lowering your risk of facing heavy fines or employee lawsuits. They can give you access to enterprise-level HR software you might not otherwise be able to afford and staff already trained in how to use it.
The PEO does not replace your HR team, but rather complements it by offering their own expertise with compliance, handling payroll, and choosing the right employee benefits. Meanwhile, your HR team knows your company and your goals and how best to work towards them.
Receive Guidance as You Grow
As your company grows, a lot of adjustments must occur. Many of these are internal, such as when you need to hire more staff and how to adjust structurally to accommodate more personnel. Others are related to compliance since having more employees requires more rules that you need to follow. Higher revenue can result in more complicated tax issues.
An experienced PEO has guided many companies through these changes. They can provide you with effectively full-time compliance advice for a fraction of the cost. Their counsel will help guide you so you don't have to develop systems through trial and error. They can provide a solid basis to work out your own way of doing things. PEOs can advise on everything from creating a training program that helps employees reach their goals to dealing with health insurance requirements.
They can also help you upgrade your benefits packages as you have more money to spend, helping you provide 401(k), wellness programs, and other perks. Many other HR outsourcing solutions start to be less effective and efficient as your company grows, but a PEO will scale with you and continue to help and offer a solid ROI over time.
Higher Retention Creates Sustainable Growth
As mentioned, partnering with a PEO allows your HR team to better support employees, helping to improve morale and increase retention. In maintaining low turnover, you have a good indicator of your company's health and fulfill a crucial need of keeping it healthy.
A company that constantly trains new hires who come in through a revolving door will never achieve the kind of productivity necessary for sustainable growth. Every time an employee leaves, they take with them the investment you put in them, the institutional knowledge they developed, and a portion of morale. While some turnover is inevitable due to employee life changes, your goal should be to keep the average months on the job as high as possible.
New hires are also inherently less productive as they get up to speed. They may reduce the productivity of the other employees mentoring them, working with them, or correcting their inevitable mistakes. Meanwhile, employees with seniority know your processes and can often come up with ideas to improve them.
Higher retention creates sustainable growth at all kinds of levels and is best supported by partnering with a PEO.
Build Structures to Ensure Stability
If your company grows too fast, it can outgrow the structures it needs to sustain the growth. If it grows too slowly then it will stagnate. Partnering with a PEO can help you balance your growth sustainably by helping build those necessary structures.
