When Should You Hire an HR Manager vs. an HR Consultant?

Are you struggling with recruitment challenges, compliance issues, or other organizational problems in your company?

This is the time you might be thinking you need an HR staff–or you might already have one but planning to upscale your team. But then, you are faced with these two options: do you need an HR manager or are you better-suited with an external consultant? 

How does the two differ? Which is really best for your needs? 

If you aren’t sure which is the right choice, this article will help you decide when to hire an HR manager vs. an HR consultant. 

The Role of an HR Manager

Depending on your business’s HR needs, you have to first know the difference between an HR manager and a consultant to make an informed decision. Let’s start with the roles and characteristics of a manager.

In-House Employee: An HR manager is your in-house and long-term employee. They handle all the human resource tasks in your organization. 

If you own a large business, you may have other HR personnel along with your manager to handle decentralized tasks.

Small businesses, on the other hand, may have a manager responsible for all operations including administration, strategy, and management. 

Company-Specific: An HR manager is exclusive to your company. Hence, they have an in-depth knowledge of your mission and vision, policies, culture, and overall goals. 

• What they do: They are responsible for planning and managing your human resource tasks including: 
• Daily Operations - these are the day-to-day processes including recruitment, onboarding, benefits administration, employee relations, and payroll.
• Employee Development - this includes performance management, training and development, and team management. 
• Compliance and Risk Management - making sure your business complies with labor laws, and addressing conflicts in the workplace. 
• Strategic Planning - developing long-term strategies to help your company grow and address challenges. 

The Role of an HR Consultant

You are more likely to bring in an HR consultant to provide a specific solution and an outsider’s perspective regarding HR-related matters in your company. You can contact them for a quick consult, or have them execute HR plans and functions for you. 

Here are the roles and characteristics of an HR manager: 

• External Contractor: This 3rd party professional works on a contractual and project basis, and is not a long-term employee in your organization. They are external experts from consulting firms. 
• Expertise: As HR specialists, they work on projects for different organizations. Hence, they have in-depth knowledge of handling disputes and other complex HR challenges.
• What they do: Now, here are some of the specific things that an HR consultant can provide you. 
• Coaching - helping you learn to communicate with your employees, setting up an HR department, and offering advice in managing organizations. 
• Consulting - providing an outside perspective, identifying areas for improvement, and researching to pinpoint underlying issues in your business. 
• Recruitment - small to large-scale recruiting, creating a job description, calling references, background checks, and creating offer letters for employees.
• Planning - creating handbooks, planning events, executing new job plans, revamping a company culture, and creating performance improvement plans. 

How to decide: factors to consider

Here are some factors you can consider to help you decide whether you might need a consultant or a manager. 

Your organization’s HR needs

1. Short-term: If you have short-term needs like restructuring, and system implementation, or even unprecedented challenges like a surge in recruitment and compliance issues, a consultant may be ideal.
2. Long-term: If your HR tasks include employee development, daily processes, and other long-term operations, an in-house HR manager might be a better choice.
3. Combination: If you need both, you can have an HR manager to handle your routine operations and a consultant for specialized projects.
4. Cost: If you’re working with a smaller budget, and have a one-time project to work with you, go for a consultant. On the contrary, if you can invest for a full-time employee, then, you can hire a manager. 
5. The pros and cons 

It’s also helpful to evaluate the potential benefits and drawbacks of each option. Here are some of them. 

HR Manager

Pros: 

• As a full-time employee, they are always available for daily operations. 
• They have an in-depth understanding of your business, including your company culture and needs. 
• As an in-house employee, they are also more knowledgeable about employee relations and retention. 

Cons: 

• Hiring and training an in-house HR manager requires a significant cost including providing ongoing salary and benefits. 
• Some HR managers may have limited specialized expertise in complex HR issues. 

HR Consultant 

Pros: 

• They can be more cost-efficient if you have short-term needs. You don’t have to pay a full-time salary. 
• Offering specialized expertise and unbiased outside perspective. 

Cons: 

• Temporary engagement
• They may not have an in-depth understanding of your employees and internal relations. 
• You may potentially need multiple consultants specializing in different matters. 

Should you hire an HR manager or consultant?

The choice of whether a manager or a consultant is a better option depends on you and your business needs. 

Ultimately, an HR manager is beneficial if you’re looking for a permanent employee to manage your daily operations.

If you’re looking for a specific solution or initiative implementation, you might want to bring in a consultant’s expertise to help you in ways that your in-house manager might not be able to. 

Of course, you can also have the best of both worlds if you deem them both valuable. 

DSA HR Solutions, Inc. — Where Your Business Comes First.

Whether your business requires the consistent, in-depth support of an HR Manager or the specialized, project-based expertise of an HR Consultant, we tailor our wide range of services, both on-site and virtual, to fit your unique needs. We ensure your business thrives with satisfied employees, robust HR policies, and unwavering compliance. Reach out to us today and let’s lay the foundation for your business’s sustained growth and success.