2007-07-19

PEO, HRO...E-I-E-I-O...

Why do TLAs and FLAs (Three and Four-Letter-Acronym) make things so confusing for business owners?

Let's face it, today you need an online database for all the acronyms that are used as business categories, to be readily available on your blackberry, i-phone or, yep, "PDA".

From an HR perspective, I've always had a question about the TLA, "PEO". PEO stands for Professional Employer Organization and as the PEO Network describes it,

"A PEO can be utilized to outsource a significant portion of the administrative burden of being an employer. The PEO can process payroll, handle the payroll tax administration; provide workers' compensation and employee benefits. PEOs can also assist in labor law compliance, risk management, EAP, hiring, firing and other HR functions.

Theoretically, PEO is a vendor consolidation and outsourcing management tool, which is facilitated through a co-employment agreement."


That may or may not clarify things for you, but it sounds like Human Resources Outsourcing or HRO (Lite) to me. It seems that every PEO has a page on their website labeled "What's a PEO"! From a marketing perspective it would be great if you didn't need to explain the industry you are in. And if the "shopper" is on your site... the good news is s/he is already there! It maybe best just to explain the value you will bring to his/her organization.

Question: Does the co-employment arrangement require the vendor to wear the "PEO Badge"?

I think the PEO concept makes a lot of sense for a small business (10-100 employees). Utilizing a viable PEO should allow you to focus on "what's ahead" for your business vs. the time consuming tasks of HR administration.

PEO's have a long history of helping the blue/grey collar company benefit by "pooling" their employees with the PEOs to ensure better health care and worker's comp insurance; and have continued to sell that "formula" as the solution. I think there may be a great opportunity for a new or existing PEO to cater to the Professional Workforce delivering comprehensive technology (self-service and reporting tools) vs. just insurance savings.

6 comments:

Anonymous said...

Seeking opportunities to reduce Workers Comp cost and provide
affordable health insurance benefits, I looked into PEOs. By
outsourcing human resources for your current employees,business
owners can reduce employee overhead and administrative paperwork.
Professional Employee Organizations removes the non-productive
tasks from your business so that you can concentrate on growing
your business. It’s like having your own personal staff of human
resource experts to handle all of your employee hassles. I researched the value of utilizing a PEO at
http://www.onlinehrhelp.com. This website directs the visitor to a reputable PEO that services both blue collar & white collar industries.

Dave Lewan said...

Nice post "Anonymous". You're absolutely correct that, if done right, a PEO truly can become the "off-site HR dept". Thanks

-Dave

Anonymous said...

I work for one of the longest operating PEO companies in the United States PML. We have been helping growing businesses since 1985.

The reason every PEO website has a definition of what a PEO is, is because most business owners have never heard of a PEO and need to be educated. To that end, I would say 80% of our sales process is education.

For more information please visit http://www.planmarc.com

Dave Lewan said...

Thanks for the comment PeoBigWig. I agree with you that educating your potential customers is extremely important in the sales process; but I also believe some PEOs may be doing themselves a dis-service by eliminating potential buyers very early in the process.

Let's face it, a PEO is not always a good fit for all, nor should they be. But as a small business the value proposition of outsourcing a non-revenue producing area (that most small business owners do NOT understand) to an EXPERT that will allow me to FOCUS on what's AHEAD in my business is extremely attractive. I would bet that if you positioned your organization as one that will keep me out of trouble with the IRS and other governmental agencies, while giving my employees and frontline managers the tools (Self-service, reporting etc.) to run our business; then I'M LISTENING! If I spend time with you getting to know, like and TRUST you and your company, the effort of trying to get my mind wrapped around co-employment may be less of a daunting task and may eliminate the barrier of entering into an agreement with you and your company.

Try it. I believe you will find success!

Dave

Anonymous said...

Yes exactly, in some moments I can say that I agree with you, but you may be inasmuch as other options.
to the article there is still a question as you did in the go over like a lead balloon a fall in love with efflux of this demand www.google.com/ie?as_q=native instruments traktor dj studio 3.2.2.020 ?
I noticed the axiom you procure not used. Or you partake of the dreary methods of promotion of the resource. I take a week and do necheg

adult babydiaper lover stories said...

Just provide me with somepassport photos. ``Cut the crap, kid.
free rape porn stories
free erotic stripper stories
gay teen stories xxx
dog on woman sex true stories
rape sexual abuse stories
Just provide me with somepassport photos. ``Cut the crap, kid.