Core Vs. Non-Core Functions
Core Vs. Non-Core Functions
We all know that payroll is a vital component of any company. Without payroll, employees don’t get paid. When employees don’t get paid, work doesn’t get done, customers don’t get their product, dogs and cats start living together, mass hysteria and the entire business spirals into bankruptcy. So this of course means that payroll is a core function of a business. Least it would be if words were worked normally. Payroll is actually not a core function of a company. Why is it not a core function though? We saw the disorder that comes about without it, so shouldn’t it be a core function? No, because by definition, a core function of a company is a function that ensures a company’s profit.
This can include selling products, keeping a competitive edge, and general marketing. Non-core functions are functions that are not related to generating a profit. Just because they are considered a non-core function does not mean they are not essential processes. Unless you have a department whose only function is to stock the break room with donuts, every department of a company has some level of vital importance. Why is this definition important? because of outsourcing.
For the most part, you cannot outsource core functions. Imagine opening a store, then hiring another store to run your store. Non-core functions on the other hand, are great departments to consider for outsourcing. These can include payroll and human resource departments. They are both vital departments, especially since they relate to your employees and their productivity, yet are capable of being run by another company.
To better understand what a core and non-core function is, and how they work, let’s look at a painter.
The painter has to paint their own creation. The paint brush, the paint, the canvas, and the painter are all core functions of the method. Without them, the work will not get done at all. If he hires someone else to paint for him, then the one hired is the painter, not the one hiring him. Now think of the music playing in the background that many people use when creating. Maybe it is coming from your iPhone. You can turn it off, and have music play from your computer instead. It still is music, and it still is serving the purpose. What if you hire someone to play music while you paint? This means you outsourced your music playing requirements to someone else.
It may seem a bit odd to hire someone to play music while you paint, yet if you pay them 10 dollars an hour, and it takes you 3 hours to finish a $500.00 painting, then you are only spending $30.00 and are making $470.00. From that standpoint outsourcing your music needs is not such a bad idea.
A business is no different from the situation we just described. Only instead of painting a scene, a business is selling a product, with areas such as payroll and human resources taking the place of the music. With this example, you should have enough understanding of core and non-core systems to analysis what you could outsource and what needs to stay in house. If you would like some more information, or a free quote to see if outsourcing is right for you, contact Vision H.R. today. Supplying Daytona Beach, Palm Coast, and even Lake Mary Payroll Services, Vision H.R. has a highly traines staff ready to assist you.
