Discover how HR outsourcing empowered BTIG to attract top talent through expert recruitment and talent management strategies.
BTIG, an outsourcing brokerage firm, offers high-priced traders to smaller hedge funds and family-owned funds with profiles large enough to be like institutions–customers who otherwise could not afford them. An experienced trader runs about $300,000 in salary alone, according to Peter Tarrent, BTIG Managing Director, and any fund requires two traders, an up-front fee that is cost prohibitive for, say, a fund of $50 million. BTIG’s customers leverage the 75 years’ total experience of BTIG’s outsourced general partners for a fraction of that cost.
However, to maintain a high-priced staff, BTIG needs to give them the same level of benefits their peers are enjoying. BTIG had to provide “the benefits they were used to with companies they once worked with like, Bank of America,” Tarrent explains.
Outsourcing its human resources processes helped BTIG hedge its bets. Gevity now handles HR for BTIG.
BTIG liked Gevity’s benefits package because it was “competitive and flexible,” according to Bernie Notas, Chief Financial Officer. With Gevity, BTIG gets competitive plans from a number of carriers. For instance, though the health insurance plan may not be necessarily cheaper than one an in-house HR person could arrange, it is much more flexible. For example, one employee may choose a Kaiser HMO plan, while others may choose a PPO and want to pick a provider for every service they access at competitive cost points.
That flexibility extends to picking and dropping point services as needed, albeit within fixed time windows. Insurance coverage also extends to workman’s compensation and supplemental life insurance for the employee and spouse.
A Great Match–An Outsourced SMB Partners with a SMB Outsourcer
Tarrent says BTIG initially outsourced Gevity’s HRO solution because the brokerage firm needed to strictly control costs. “We didn’t want an in-house staff with the overhead required to have comprehensive HR,” he explains.
BTIG has grown aggressively since its launch, from five employees to 110. A key component of its growth strategy was not adding HR staff so it could cost its talent pool across a greater number of clients. However, it also needed the specialized service only an HR expert could provide.
As a specialized small-to-medium (SMB) brokerage house handling mid-sized investment portfolios, BTIG understands the value that an outsourced solution can bring to customers who need to be flexible in the way they invest and for whom keeping down costs is a must. It’s also keenly aware that its own sweet spot is managing funds that will one day become large enough to outgrow BTIG. That’s why it demands flexibility and low cost from its HRO solution.
Notas, who was largely in charge of hiring Gevity, liked the fact that he could cost out the outsourced solution over time and achieve per-staff rates up front that initially saved over hiring HR staff. So as BTIG profited, it could allocate new funds to HR and not have to operate in deficit as a start-up.
Gevity specializes in serving small-to-medium size businesses in four HR areas: recruiting, performance management and benefits, payroll, and regulatory compliance. It offers an HR team headed by one lead person and combines expert personnel and proven work processes with a Web-enabled portal platform. Of these, BTIG takes advantage of health and other insurance benefits, payroll and financial services like 401(k)s and other employee investment vehicles.
Notas says he outsources payroll because it’s not a complex process for a company of BTIG’s size, and reporting requirements are minimal also. Nonetheless, Gevity offers different types of reports to accommodate specialized needs of its customers–paid time off, for instance.
When it comes to financial services, Tarrent says BTIG’s “goal for our employees is that they can preserve and grow wealth whether that’s through a savings account or IRA or 401(k).” Gevity provides vehicles for all these strategies and can offer them at lower overhead, obviously, because it costs services over the entire range of its customer base.
Technology–Added Value for All Employees
As a plus, Gevity also offers a self-service Web site for all its customers’ employees. Here, customers can make changes to their savings plans and healthcare packages and submit questions about personnel and other regulations to Gevity’s team of experts. Tarrent says it’s “a comprehensive and user-friendly portal that has a ton of information that employees are interested in having.” Tarrent likes the fact that he can “use it to check on the details of my benefits. Personally, I use it to find out the limits of my benefits, make changes to anything like insurance such as FSA (flexible spending accounts) for health insurance–and I can access copies of my W2s.”
Notas uses it, for instance, for administrative tasks like processing payroll and retrieving payroll reports.
Tarrent appreciates the fact that the portal is backed up with an expert Gevity team. With personnel only a local phone call away, he says, “You don’t send emails to strangers in the hope that you might get a response at some point in the future.” What’s more, the lead person and the rest of the team are located in San Francisco where BTIG is located, so they’re in the same time zone and familiar with all the local regulations that affect BTIG. This way, says Notas, “my human resource consultant is always available to answer my questions and retrieve information for me.”
Understanding the Value of Outsourcing in Talent Acquisition
Because high growth is crucial for BTIG, being able to add traders with great experience and skills to compete with high-cost traditional brokerages is key. Without Gevity, BTIG could not accomplish any of these goals to the extent that it has. You might say Gevity is BTIG’s best employee–cutting costs, growing benefits, and adapting to the company’s needs as it grows.
Lessons from The Outsourcing Journal:
- Outsourcing suppliers understand the need for outsourcing their non-core processes. They take advantage of outsourcing’s benefits because they truly understand the value proposition.
- BTIG outsources high-priced talent and had to provide comparable benefits to attract the kind of talent it needs. Outsourcing HR allowed it to do so.
- Outsourcing HR helps rapidly-growing companies grow because it doesn’t have to add costly HR staff.
- Customer-service portals and expert personnel combine the best of both worlds–quick self-service with expert consulting when required.
About the Author: Ben Trowbridge is an accomplished Outsourcing Consultant with extensive experience in outsourcing and managed services. As a former EY Partner and CEO of Alsbridge, he built successful practices in Transformational Outsourcing, BPO, IT Outsourcing, and Cybersecurity Managed Services. Throughout his career, Ben has advised a broad range of clients on outsourcing and global business services strategy and transactions. As the current CEO of the Outsourcing Center, he provides valuable insights and guidance to buyers and managed services executives. Contact him at [email protected].