Is Your Current PEO the Right PEO for Your Company?

Change From Your Current PEO

If you have entrusted your business to a PEO then we realize the tremendous commitment that was symbolized with that decision.  However, like an annual check-up, there five important questions you should be asking yourself about the relationship with your existing PEO.  They are:

  1. Are my expectations being met?
  2. Is the human factor missing?
  3. Is your PEO privately held?
  4. Are promises being kept?
  5. Am I ready to explore an alternative?

It is human nature to avoid change. Change makes us uncomfortable. Why? Because people are creatures of habit. We drive the same way to work, we have the same daily rituals and routines. Some even eat the same meals at the same time and at the same restaurants. The same holds true in business. We like our relationships, we like dealing with the same people, we like the status quo. In a perfect world, this would be the ideal that we all live by.

Unfortunately, that isn’t possible in a world where the profit margins grow thinner and the competition grows fiercer in the global economy. There is always someone doing it better, faster, and for a lower cost. How many old stalwart brands like Block Buster have fallen to the wayside? Technology has made Amazon a giant and put pressure on brick and mortar businesses to try and compete. So how did Amazon come in and upset the status quo? By offering the ability to shop from wherever you are. No more dreaded trips to the mall.

While this is great for many people, this change in attitude by consumers has never been totally embraced. People love buying many goods online, but not a soul likes to deal with the faceless behemoth who treats them like a number. Get in line with the rest of the cattle who are waiting in que to speak to a human being after following 22 phone prompts. It’s gotten so bad that now some companies will allow you to leave a number for them to call you back. That’s the double edge sword of technology; increased efficiency at the expense of human touch and concern. Humans are an odd bunch, they like to have their problems solved, but just as much, they like someone to understand their plight.

Are My Expectations Being Met?

It’s a giant leap for companies to outsource their HR function to an outside vendor. The PEO concept is brilliant for the small to mid-sized business. You are already sold on the concept and have reaped its benefits. It’s rare that a company ever brings the HR function back in house after using a PEO. Those of you who use a PEO are in the minority; statistics say only about 3% of all US companies use the PEO model. The question that 3% of PEO users should ask is “is my current PEO not only meeting my needs, but is it giving me the best possible service at a fair price?” Is your PEO like the proverbial comfortable shoes or is there a better pair of sneakers out there? You will never know unless your business comparison shops.

Is The Human Factor Missing?

Technology is evolving at a rapid rate. The changes seen in the last 10 years probably is greater than the change in the preceding 50 years. New software, quantum computers, and faster transmission of information allow businesses to completely overhaul how they operate. We can now communicate in real time around the globe. While technology is awesome, it can never replace the a human being in the service sector. People like to talk to people, not machines. In the PEO space, many of the publicly held “PEO in the box” type companies are losing their human element. Due to their sheer size, these large PEO’s are forced to rely heavily on technology to manage their massive client base. What’s the answer you may ask? Do you go to the small mom and pop PEO or the massive yet slow to respond PEO that lacks a human touch? Why not consider a right size PEO? One who has top of the line technology, but is also personal, who knows specifically you and your company and your needs and desires.

Private vs. Public PEO’s…There’s a Difference

One big issue many companies face in the PEO space is a lack of transparency in billing on the PEO’s part. I spoke with a consultant who vetted 32 PEO’s to find a new one after two of the largest companies in the space failed miserably on their account. She said “we couldn’t even figure out what their true cost was because there were so many fees that weren’t in black and white.” Many of these companies do two things. Number one, they basically lease the client their proprietary software and help them become good at doing the PEO’s job. Number two, they kill the clients with a la carte service fee’s. The company should ask themselves “What does my PEO do, and do I really know how much my PEO is costing me?” If these questions can’t be answered very quickly and simply, your PEO is lacking in transparency. As a rule of thumb, publicly held PEO’s tend to be 25-40% higher in cost than privately held PEO’s due to having to provide shareholder profits.

Are Promises Being Kept?

Look for PEO’s that can provide a competitive quote to assess your current vendor. It doesn’t hurt to look and see if you’re getting a good value for your investment. The PEO needs to be able to deal with the company’s needs, yet still be able to maintain high levels of service and a human touch. It seems like finding the Holy Grail would be easier. So many large PEO’s tout service yet deliver none while the very small PEO’s are great at providing service, but don’t have the budget or man power to offer the amenities that a company would need to run optimally; it’s like a double edge sword. So what options are on the table for a small to midsize business that needs a robust service platform and yet doesn’t want to sacrifice service? That’s where a ‘right sized’ PEO enters the picture. One that offers a premium service platform synonymous with a small PEO and all the technology that many of the larger PEO’s offer. America’s Back Office is poised in this realm as a PEO that is large enough to matter but small enough to care!

It’s Time To Consider An Alternative

For 20 years, America’s Back Office has been a leading Professional Employer Organization. We have grown from a start up to a large PEO that services the entire United States; we have employees in all 50 states including Guam, Puerto Rico, and the Virgin Islands. We are basically a Fortune 500 level HR Department for hire! One very important distinction is that we are privately owned, so we aren’t beholden to shareholders. How does this benefit a prospective client? Generally, we are on average 20-40% lower in cost than our larger publicly held competitors. What truly sets us apart in this industry is how flexible we are at applying our service model and the level of service we provide. We pride ourselves on exceptional service. We find the best way to seamlessly integrate our platform into our valued client’s current operating system, so it is minimizing disruptions from their day to day processes. When people ask what the true value proposition of a PEO is, we never say money. We at America’s Back Office believe we do these processes faster, more accurately, and at a lower cost than a company can do it on their own. Call us today at (586) 997-3377 or feel free to email us at