Frequently Asked Questions
Your top 8 questions, answered!
How can outsourced HR help business leaders?
Delegate HR tasks to an expert – focus on your business.
Tom: So how can fractional HR Consulting, Outsource HR, whatever we want to call it these days, help you as a business leader or founder?
It’s going to help your company grow because you’re going to focus on what you’re an expert at and you’re delegating to Castle HR or an outsourced HR firm, those HR responsibilities which they’re experts in.
And if you’re doing this and you have those experts, just those two things, you’re focused on growing your business.
We’re focused on building the amazing team that’s supporting you, that’s going to enhance your business, rather than you focusing on HR challenges, asking Google what should I do, which is never a good idea.
Having that peace of mind that you have somebody in your corner makes such a big difference, and that’s something we hear from all of our companies pretty much across the board.
So if you’re looking at supercharging your HR strategy, wanting to get to that next level, not waiting to hire an internal HR generalist, you know, and have $150,000 lying around for that, then HR Consulting is going to help you, and this is where we shine and Who We Are.
Why Use HR Consulting?
Scale your business effectively with the right people.
Tom: Okay, one of the questions that we often get, and I’m sure you’re thinking because I would be thinking this too, is why should you explore outsourcing HR to a firm, right?
How is an HR consultant actually going to help you and why should you do that? And I’ve read a bunch of the top sales books, I don’t really have piles around, and the thing that they all talk about, it doesn’t matter which business strategy book you’re talking about on how to scale up and build a successful company, they’re talking about having the right people there.
That is mission critical. You can’t do anything if you don’t have the right people. You’re not able to delegate, they’re not able to be successful, your company is simply not going to grow.
And that’s a key for us. All of our steps and our processes focus on having the right people in the right seats. And if that sounds familiar because you’ve read Traction EOS, that’s because we’re big believers and we actually run that process internally at house. And you blend EOS with modern HR strategies, and if you get that right, like if you absolutely nail having the right people in the right seats, it’s really, really hard not to be successful.
So that’s what we’re chasing and that’s what our service provides for companies.
And you have an idea on your amazing product, service, whatever you’re offering and selling. That’s what you know, we know how to build a team that is going to get your company to where it wants to be. And that’s why companies use us.
What Services Does Castle HR offer?
HR foundations, modern strategies, and more…
Tom: Let’s talk about what services Castle HR provides, and really, there’s only one service that we offer.
And that is our fractional HR subscription. So we have this one model where we’re going to partner you with an amazing senior HR professional, and they’re going to work with you. And it’s not just sort of following straight rigid, ‘This is what we need to do.’ It’s understanding your business and being true consultants, earning a seat at the table with your company to understand how we can help with the tools that we have in our toolkit.
And our service is going to vary then from foundational pieces like building values or augmenting your values, creating a customized employee handbook to make sure that the business is protected and you’re setting expectations for your team. Surveys, your HR Tech stack, those are all things that we call our foundational pieces.
We also get into modern performance reviews, so quarterly conversations that actually inspire your team. And we’ve heard teams that actually ask when their next quarterly performance review is going to be because they love how they’re structured and how they work. So very modern and focusing on retention.
Then talent acquisition, how do you turn yourself into a destination and become a talent magnet? Like I mentioned before, Castle actually has a waiting list of senior HR professionals waiting to join Castle HR, and that’s because we’ve built out this destination. And so, you can do this. We’re only just in our 20s at this point. You can build this as well.
Then it’s onboarding/offboarding, which is critical as well. How are you welcoming people to your company, setting them up for success? And how are you exiting people so that possibly they may be coming back later as a boomerang effect or just keeping good relationships by not just blasting people out the door?
These are our main facets. We also get into things like recognition, some compensation conversations. There are a number of different areas we get into as well. But our main service is focusing on pulling those tools out depending on where you are and your company is in your trajectory and what your goals are. And we’re going to line up with them. That’s really what our service is. So if it boils down to it, you’re getting a senior HR professional that’s going to work for your best interests, but they’re just doing it on a fractional time and also a fraction of the cost. Hopefully, that answers that question.
What Does Castle HR NOT offer?
There are just a few things…
Tom: On the flip side of my previous question of what does Castle cover, it’s really important to talk about what Castle does not do. What does our service not include? And for this, I’ll usually go back to our Hedgehog Theory, which is from ‘Good to Great’ if you’ve read that, and it really focuses on what are you really passionate about, what are you the best at, and what fuels your economic driver. Anything that fits in the middle of that, that’s what Castle does. Anything outside that, we don’t do.
So, things that we don’t believe in doing or aren’t passionate about is recruiting. We don’t really do recruiting in that percentage sense. We don’t love that model. We don’t like the hustle of trying to find it. We prefer the talent acquisition playbook and building out an evergreen strategy to bring talent on to companies, which is more sustainable and how we built our talent acquisition strategy.
We don’t do benefits. We will advise and talk about what needs to be done and what you should do, but we’re not natural benefit advisors nor benefit administrators. So, we’re not going to be entering information into your benefit database. That’s more of an admin function, and to be honest, from leader to leader, you don’t want to pay our rates for our people to do that.
Thirdly, we don’t do payroll. And to think for a second there, we don’t get into payroll and running those functions for the same reason as benefits. It’s a very specific admin function, and it’s a repeatable task that can be done more economically with somebody else. To be honest, most companies we work with already have that under control. As I mentioned previously, our entry point is usually about 15 people. The average company is about 27 people when we join, so they usually have payroll figured out at that point and it’s something that we don’t need to add in.
So, those are the main things that we don’t cover on that side.
When Should You Invest In HR Consulting?
Your headcount matters – there is a ‘sweet spot.’
Tom: One question we get asked all the time is when should we invest in HR consulting? When does it make sense to bring in an outsourced HR consultant, use fractional HR? When does that make sense?
Typically, for us, we see it as once a company has found product-market fit. So, you’ve gone through the validation of your idea, you’re now getting some revenue in, people are buying your service. What you’re really focused on now is rinsing and repeating. So, you want to add more sales and improve your service, but you’re just now building up and up and up. Now it’s a real business. So, it shifts from driving revenue and validating to growing the team, which is also focused on growing revenue. But now, you know that you can get that revenue, and that’s where HR comes in.
Typically, when we’re talking with companies, we kind of set the goalposts at about 15 headcounts. That’s when it makes sense for Castle to come in, and our services and processes are going to impact your business greatly. On the other end of the scale, if you’re at sort of 50 to 75 headcounts, then it makes sense to hire somebody internally, most likely, because then there’s enough work and there’s enough growth going on that you need a full-time HR professional in-house.
So, if we’re just looking at that simply between 15 headcounts and 50 headcounts, revenue doesn’t really come into our conversation here. That’s not a driving factor. If you’re in that sweet spot for us, that’s our fairway. I’m a golfer, so that’s where we help companies, and that’s how you’re setting yourself up for success. Because if you’re waiting until that 50 to 75, you’re course-correcting too much at that point. A lot of things have happened, they’ve been built, and they were probably just put in place as Band-Aid solutions because you’re running around with your hair on fire when challenges happen.
So, that’s where we suggest companies look at it. For us at Castle, our average company headcount is actually 27. So, that’s when companies are really joining us on average. Hopefully, that answers that question. There are a couple of other factors in there, but those are the main ones.
How Much Does HR Consulting Cost?
There is a range, but it is less than an internal hire!
Tom: Let’s talk about cost, something that comes up because people just don’t know what HR consultants cost. And if you go to the market, there’s a huge variety of this, whether we’re talking about recruiting with their massive percentages that they charge of 25-30% per role, but then you can get into other ones that come in on a day rate, and that can cost 7 to 10 thousand dollars just for one day a week for them to come in and do whatever they do for your company.
Castle HR is a little bit more agile, so our pricing matches up with flexibility. We’re going to work with companies. We have a recurring one-hour-a-week meeting where we’re going to come in and have a conversation, and then we work in the background. So, it gives us some flexibility to take what we’ve learned from that hour, usually running some sort of exercise or discussion, and then going away and getting that work done to show up next week and provide you with the homework and the amazing tools and processes we’ve built.
With that, we are able to offer a discount to our clients off of that seven to ten thousand dollars. We are around three thousand dollars a month for our service. Our contracts typically ask for the first six months to be guaranteed, and then we go month-to-month after that because we don’t believe in those long-term contracts.
But really, if we’re going to start with a company and you’re looking at HR seriously, six months is a very little bar. And as I mentioned in other videos, here 18 to 24 months is typically how long clients stay with us because then it makes sense for them to invest, usually internally or pass it on to a junior person that can run our processes.
So, that’s typically what we cost on that side. We do have uppers if you need more time with us and more focus, we certainly can add that. If you need us to be an HR director, we can add that in and look at that for a number of companies. Typically, after we build out our processes and you’re scaling your team, we’ve also done comp reviews and large-scale processes for that side, and that comes at an additional ticket as well.
So hopefully that answers your questions for the services we do cover. There are two other videos about that, and there’s also a video about the services that are not covered. If you haven’t looked at those two videos, that’ll probably answer your next couple questions.
How Long Do You Need Outsourced HR Support?
It varies, but there is an average time-frame…
Tom: One question that I get asked is how long do I need fractional HR support or HR support in general, or use an outsourced HR firm? And it’s a great question, and it really depends on your business, your growth trajectory, and when you first invest in HR. So, there are going to be a lot of variables here.
The one thing I’m going to start this conversation with is once you start down the path of investing in HR strategies and using them, it doesn’t stop. You need to constantly have somebody at the wheel doing that. So, at Castle, we usually come in, like we said, at that 15 to 50 headcounts. We’re coming in at around 15, and we’re probably passing the baton at about 50 to 75. And it really depends on how fast you grow to that point and how quickly we can execute on building out our processes.
A typical client is with us for about 18 to 24 months, so it’s about two years to build that. Now, if you are someone like a deal-maker who’s an absolute rocket ship and took on hyper-growth, grew from 30 to north of 100 in 12 months with us, then yeah, we had to start hiring people along the way to help out. So, we ended up hiring a team and passing the baton to an HR director there.
Ultimately, our goal is to set you up for success and then transition the time to someone internally, whether that’s a junior person that can then run our processes, or whether that’s hiring someone like an HR director to really take over the reins of that HR strategy. And what that takes is usually a minimum of 12 months, but like I said, 18 to 24 months is usually what we plan for to really build this out and help you get to that next level.
Who Would Your HR Business Partner Be?
We’ve got a dedicated group of HR experts.
Tom: So if you’ve been on our site and seen our team, you might be asking, ‘Who would our HR person be?’ And it’s a great question. We take this very seriously in partnering the skill sets and personalities of our HR professionals with the company and profile of the leadership team that we’re working with. So when we do that, we spend a lot of time pairing them up properly.
It comes down to sometimes backgrounds. If you’re in software, you want someone with experience in that. Manufacturing has different health and safety regulations, so we’re going to give you the best person who has experience in your arena and probably has a similar personality type or works well with you. We take this very seriously, and we don’t get it wrong often. We’ve probably had three or four instances in our entire lifetime, so in our four-plus years of existence, we’ve only had to switch HR people around three or four times.
I can say I turn to my entire team for advice because they’re all fantastic. And obviously, I’m completely biased, but they’re all brilliant. We were very rigorous about our vetting process to get in the door, so we have confidence in everyone when they get partnered up with.