Is HR outsourcing for you? Our quick presentation will hopefully answer that question for you.

1. Why Outsource your
Human Resources?
Will it work for my company?
© 2010 PEO Consulting Group, Inc. Used with permission by HROplus.

2. Our Mission
To improve owner's wealth
by delivering HR services in
a manner that impacts our
client's profitability and
business value.
© 2010 PEO Consulting Group, Inc. Used with permission by HROplus.

3. Reasons Companies Consider
Outsourcing Human Resources
• Reduce labor costs – save money
• Attract and retain better employees
• Increase employee productivity
• Decrease liability – compliance
• Simplify
© 2010 PEO Consulting Group, Inc. Used with permission by HROplus.

4. Benefits of Human Resources
Owner Wealth Accumulation
Shareholder Value
(Shareholder Value)
Build…
Business Self- • Hire experts and
Increase Business Value Sufficiency and specialists
(For Sale or Exit Strategy) • Consolidate
Systemization
vendors
Non-Qualified Deferred Comp Plans
Executive Compensation
Improve Company Profits
Asset Cost Employee
Attract Better Employee Leverage
Protection Containment Retainment
Talent Performance Resources
Strategies Strategies Strategies
Protect… Control… Improve… Improve… Monitor…
• Compliance • Health insurance • Recruiting strategy • Individual / team • Efficiencies
(proactive) increases • Interviewing effectiveness productivity • Save time
• Trade secrets • WC E-Mod • Selection process • Training / dvlpmnt • Job analysis
(proactive) • SUI rate(s) • Compensation • Communications • Core bus. focus
• Litigation • Benefits plan • Absenteeism • Outsource options
(reactive) • Training & development • Lost time
• Strategic planning
© 2010 PEO Consulting Group, Inc. Used with permission by HROplus.

5. The Competitive Edge of Human Resources
Owner Wealth Accumulation
Shareholder Value
• Large companies with HR departments employ “Human Capital
(Shareholder Value)
Management” strategies to increase shareholder value. • HireBuild…and
experts Business Self-
Increase Business Value Sufficiency and specialists
• Smaller companies with limited HR expertise are at a competitive
(For Sale or Exit Strategy)
Systemization • Consolidate
vendors
disadvantage to larger companies, and may not make as much
Non-Qualified Deferred Comp Plans
money per employee. Executive Compensation
• A Professional Employer Organization (PEO) makes large
Improve Company Profits
company HR expertise available to smaller businesses at a small
fraction of the investment of hiring all that expertise on their
Asset Cost Employee
own.
Protection Containment
Attract Better
Retainment
Employee Leverage
Talent Performance Resources
Strategies Strategies Strategies
• And here’s how…
Protect… Control… Improve… Improve… Monitor…
• Compliance • Health insurance • Recruiting strategy • Individual / team • Efficiencies
(proactive) increases • Interviewing effectiveness productivity • Save time
• Trade secrets • WC E-Mod • Selection process • Training / dvlpmnt • Job analysis
(proactive) • SUI rate(s) • Compensation • Communications • Core bus. focus
• Litigation • Benefits plan • Absenteeism • Outsource options
(reactive) • Training & development • Lost time
• Strategic planning
© 2010 PEO Consulting Group, Inc. Used with permission by HROplus.

6. For Small- to Medium-Sized Businesses, Using
a PEO Is Similar to Using a Law or CPA Firm
CPA Firm – Expertise in: Law Firm – Expertise in: PEO – Expertise in:
CPA Firm –&Expertise in:
Audit Review Services Law Firm – Expertise in:
Business Law PEO – Expertise in:
Recruiting & Selection
Tax Code Contracts Training & Development
Audit & ReviewPlanning
Estate Services Business Law
Corporate Structure Recruiting & Selection
Compensation
Tax Code Planning
Succession LawsuitContracts
Defense / Initiation Training & Development
Benefits Management
Internal Controls
Estate Planning Real Estate
Corporate Structure Employee Relations
Compensation
Financial Automation Gov’t Compliance / HR Records
Succession Planning Lawsuit Defense / Initiation Benefits Safety
Health &
Management
Internal Controls Real Estate Employee Relations
Financial Automation Gov’t Compliance / HR Records
Health & Safety
Business owners use a portion of the expertise of specialists
to protect and help their businesses grow
Your
Business
© 2010 PEO Consulting Group, Inc. Used with permission by HROplus.

7. Example of HROplus Account Team
Your Company
Human Resources
Sales Operations Finance Admin / IT
(The Best HRO, Inc.)
John Doe Mark Spitz, SPHR
CEO
20 years business owner VP, Human Resources
10 years HR experience
Employee Benefits Payroll Strategic HR Legal / Compliance HRIS Finance Safety / Risk Mgmt
Maria Pierce, SPHR
Bonny Parks Paul Dunn, PHR Manager, HR Coordination Bill Shinig, Esq. Howard Smith John Minefield Kathy Plumadore, ARM
VP, Benefits HR Director (Recruiting, Interviewing, Corporate Counsel VP, Information CFO Loss Control Manager
(Insurance, Retirement, (Admin, Compliance) Employee Relations, Technology 16 years experience (WC, Claims, Safety,
125, Compliance) Policies, Unemployment, 14 years IT executive Training, OSHA)
Compliance)
Kathy Hollis Angela McDonald Jackie Emigh Kathy Perkins, PHR Scott Phillipus M. Morrison Valerie Pyper
Benefits Administrator Sr. Account Admin HR Assistant Sr. HR Coordinator IT Support Asst Operations Manager Loss Control Asst
Gladys Perez Crystal Humphrey Shannon Parker Vanessa Segura, PHR B. Northcross
Benefits Assistant Account Admin Account Admin HR Coordinator Tax Specialist
Colleen George Mary Jane Johnson Tammy Burns, PHR Tanya Orlansky
Account Admin Account Admin HR Coordinator Bookkeeper
Susan Bear Luann Nakahara Rick Martin, PHR Jung Park
Courier Courier HR Coordinator Accounting II
401(k) Providers Employee Benefits Labor Attorney Information Banking Institutions Workers Comp
Vendors
and TPAs Insurance Cos Technology Bank of America Carriers / Agents
Aetna, MetLife, VSP, Pr
Fidelity e-Paid Dilly, Dally, Delayin PeopleSoft CPA Firm Zurich, Wausau
Legal, AFLAC, Unum, B and Stallin
eechstreet, Crunch and Cash, LLP
VPI Pet Insurance
Agencies
State Unemployment EEOC IRS State Workers Comp
Gov’t
Agencies (Employment Related) Agencies
Dept. of Labor (DOL) US Customs &
Immigration Service
© 2010 PEO Consulting Group, Inc. Used with permission by HROplus.

8. What This Means in Bottom Line Dollars
Owner Wealth Accumulation
(Shareholder Value)
What?
Build…
(HR Strategic) Business Self- • Hire experts and
Increase Business Value Sufficiency and specialists
(For Sale or Exit Strategy) • Consolidate
Systemization
vendors
Non-Qualified Deferred Comp Plans
Executive Compensation
Improve Company Profits
Asset Cost Employee
Attract Better Employee Leverage
Protection Containment Retainment
Talent Performance Resources
Strategies Strategies Strategies
Protect… Control… Improve… Improve… Monitor…
• Compliance • Health insurance • Recruiting strategy • Individual / team • Efficiencies
(proactive) increases • Interviewing effectiveness productivity • Save time
• Trade secrets • WC E-Mod • Selection process • Training / dvlpmnt • Job analysis
(proactive) • SUI rate(s) • Compensation • Communications • Core bus. focus
• Litigation • Benefits plan • Absenteeism • Outsource options
(reactive) • Training & development • Lost time
• Strategic planning
© 2010 PEO Consulting Group, Inc. Used with permission by HROplus.

9. What This Means in Bottom Line Dollars
Owner Wealth Accumulation
Shareholder Value
(Shareholder Value)
Why?
Build…
(Company Strategic) Business Self- • Hire experts and
Increase Business Value Sufficiency and specialists
(For Sale or Exit Strategy) • Consolidate
Systemization
vendors
Non-Qualified Deferred Comp Plans
Executive Compensation
Improve Company Profits
Asset Cost Employee
Attract Better Employee Leverage
Protection Containment Retainment
Talent Performance Resources
Strategies Strategies Strategies
Protect… Control… Improve… Improve… Monitor…
• Compliance • Health insurance • Recruiting strategy • Individual / team • Efficiencies
(proactive) increases • Interviewing effectiveness productivity • Save time
• Trade secrets • WC E-Mod • Selection process • Training / dvlpmnt • Job analysis
(proactive) • SUI rate(s) • Compensation • Communications • Core bus. focus
• Litigation • Benefits plan • Absenteeism • Outsource options
(reactive) • Training & development • Lost time
• Strategic planning
© 2010 PEO Consulting Group, Inc. Used with permission by HROplus.

10. What This Means in Bottom Line Dollars
Owner Wealth Accumulation
(Shareholder Value)
How?
Build…
(HR Strategic) Business Self- • Hire experts and
Increase Business Value Sufficiency and specialists
(For Sale or Exit Strategy) • Consolidate
Systemization
vendors
Non-Qualified Deferred Comp Plans
Executive Compensation
Improve Company Profits
Asset Cost Employee
Attract Better Employee Leverage
Protection Containment Retainment
Talent Performance Resources
Strategies Strategies Strategies
Protect… Control… Improve… Improve… Monitor…
• Compliance • Health insurance • Recruiting strategy • Individual / team • Efficiencies
(proactive) increases • Interviewing effectiveness productivity • Save time
• Trade secrets • WC E-Mod • Selection process • Training / dvlpmnt • Job analysis
(proactive) • SUI rate(s) • Compensation • Communications • Core bus. focus
• Litigation • Benefits plan • Absenteeism • Outsource options
(reactive) • Training & development • Lost time
• Strategic planning
© 2010 PEO Consulting Group, Inc. Used with permission by HROplus.

11. What This Means in Bottom Line Dollars
Owner Wealth Accumulation
Shareholder Value
(Shareholder Value)
Build…
Business Self- • Hire experts and
Increase Business Value Sufficiency and specialists
(For Sale or Exit Strategy) • Consolidate
Systemization
vendors
Non-Qualified Deferred Comp Plans
Executive Compensation
Improve Company Profits
Asset Cost Employee
Attract Better Employee Leverage
Protection Containment Retainment
Talent Performance Resources
Strategies Strategies Strategies
Protect… Control… Improve… Improve… Monitor…
• Compliance • Health insurance • Recruiting strategy • Individual / team • Efficiencies
(proactive) increases • Interviewing effectiveness productivity • Save time
• Trade secrets • WC E-Mod • Selection process • Training / dvlpmnt • Job analysis
(proactive) • SUI rate(s) • Compensation • Communications • Core bus. focus
• Litigation • Benefits plan • Absenteeism • Outsource options
(reactive) • Training & development • Lost time
• Strategic planning
© 2010 PEO Consulting Group, Inc. Used with permission by HROplus.

12. HR Capabilities Gained Through Outsourcing
Protect… Control… Improve… Improve… Monitor…
• Compliance • Health insurance • Recruiting strategy • Individual / team • Efficiencies
(proactive) increases • Interviewing effectiveness productivity • Save time
• Trade secrets • WC E-Mod • Selection process • Training / dvlpmnt • Job analysis
(proactive) • SUI rate(s) • Compensation • Communications • Core bus. focus
• Litigation • Benefits plan • Absenteeism • Outsource options
(reactive) • Training & development • Lost time
• Strategic planning
© 2010 PEO Consulting Group, Inc. Used with permission by HROplus.

13. What This Means in Bottom Line Dollars
Owner Wealth Accumulation
Shareholder Value
• Will vary widely between different types of companies
(Shareholder Value)
Build…
• Requires a realistic look at currentValue issuesBusiness Self- Quo”)
Increase Business
HR (“Status • Hire experts and
specialists
Sufficiency and
(For Sale or Exit Strategy) • Consolidate
Systemization
• Requires some reasonable assumptions and estimates vendors
Non-Qualified Deferred Comp Plans
• The financial impact IS REAL Compensation be dramatic
Executive and can
Improve Company Profits
Asset Cost Employee
Attract Better Employee Leverage
Protection Containment Retainment
Talent Performance Resources
Strategies Strategies Strategies
Protect… Control… Improve… Improve… Monitor…
• Compliance • Health insurance • Recruiting strategy • Individual / team • Efficiencies
(proactive) increases • Interviewing effectiveness productivity • Save time
• Trade secrets • WC E-Mod • Selection process • Training / dvlpmnt • Job analysis
(proactive) • SUI rate(s) • Compensation • Communications • Core bus. focus
• Litigation • Benefits plan • Absenteeism • Outsource options
(reactive) • Training & development • Lost time
• Strategic planning
© 2010 PEO Consulting Group, Inc. Used with permission by HROplus.

14. What's the Cost of "Status Quo" HR?
• 30-employee company
• $5,000,000 annual revenue
Example
• Net profit of 8% = $400,000 per year
Employee productivity 70% They’re achieving this
Administrative HR hours 500 profitability and success
Executive / owner HR hours 50
with some existing
Turnover at cost of $8,220 per person 30%
Budgeted annual health ins increases 15%
“Human Resources
WC exp. mod at 3.5% avg. rate 1.1 Profile”…
State unemployment rate 3%
HR legal / consulting fees $10,000
Employee lawsuits / compliance fines None
© 2010 PEO Consulting Group, Inc. Used with permission by HROplus.

15. What's the Cost of "Status Quo" HR?
Over 5 years, Five-Year Illustration
Cumulative Net Profit
if nothing changed,
$2,000,000
$2,000,0000
in anticipated
Net Cumulative Profit
Now 1 Yr 2 Yrs 3 Yrs 4 Yrs 5 Yrs
© 2010 PEO Consulting Group, Inc. Used with permission by HROplus.

16. What's the Cost of "Status Quo" HR?
Let’s switch from Five-Year Illustration
Cumulative Net Profit Difference
Net Cumulative Profit
and look at
Net Cumulative
Profit Difference
$0
Now 1 Yr 2 Yrs 3 Yrs 4 Yrs 5 Yrs
© 2010 PEO Consulting Group, Inc. Used with permission by HROplus.

17. What's the Cost of "Status Quo" HR?
• What if “status quo” went to “ideal”? Five-Year Illustration
Cumulative Net Profit Difference
• What’s the difference in net profit?
$1,361,059
• Is some of the money being left $1,311,059
$1,248,659
$1,201,409
on the table worth going after? $985,926
Status Quo
Ideal $752,439
$722,439
$684,499
$656,649
$591,555 $616,026
$612,821
$600,000
Employee productivity 100%
70%
$369,615
$367,692
Administrative HR hours 500
0 $360,000
$233,165
$210,685
$197,185
$201,235
Executive / owner HR hours 50
0 $123,205
$122,564
$120,000
$0
Turnover at cost of $8,220 per person 30%
0%
Budgeted annual health ins increases 15%
0%
WC exp. mod at 3.5% avg. rate 0.8
1.1
State unemployment rate 1%
3%
HR legal / consulting fees $10,000
$0
Employee lawsuits / compliance fines None
Now 1 Yr 2 Yrs 3 Yrs 4 Yrs 5 Yrs
© 2010 PEO Consulting Group, Inc. Used with permission by HROplus.

18. What's the Cost of "Status Quo" HR?
• Component Impact: “Status Quo” Versus “Ideal”
• Profit Loss from “Non-Ideal” HR – 5-Year Impact
Legal & Compliance Costs (HR) $50,000
$600,000
Employee Productivity
WC Exp Mod Reduction $47,250
SUI Rate Reduction $41,438
Health Insurance Increases $224,586
Turnover $369,900
Owner / Exec HR Hours $5,872
Administrative HR Hours $12,821
$0 $600,000
© 2010 PEO Consulting Group, Inc. Used with permission by HROplus.

19. What's the Cost of "Status Quo" HR?
• What if “status quo” went to “at risk”? Five-Year Illustration
Cumulative Net Profit Difference
• What’s the difference in net profit?
$1,361,059
• Is the potential financial downside
worth proactively protecting against?
Status Quo
At Risk $752,439
Employee productivity 60%
70%
Administrative HR hours 700
500
$233,165
Executive / owner HR hours 150
50
$0
Turnover at cost of $8,220 per person 40%
30%
($40,000)
($41,026)
($42,308)
($68,318)
($66,968)
($71,468)
Budgeted annual health ins increases 20%
15% ($120,000)
($123,077)
($126,923)
($200,903)
($234,035)
($224,585) ($205,128)
($200,000)
($211,538)
($247,475)
WC exp. mod at 3.5% avg. rate 1.2
1.1 ($334,838)
($447,475) ($438,982)
($423,232)
($465,862)
State unemployment rate 4%
3%
$200,000
$10,000 ($665,862)
HR legal / consulting fees
Employee lawsuits / compliance fines None
Now 1 Yr 2 Yrs 3 Yrs 4 Yrs 5 Yrs
© 2010 PEO Consulting Group, Inc. Used with permission by HROplus.

20. What's the Cost of "Status Quo" HR?
• Component Impact: “Status Quo” Versus “Ideal”
• Profit Loss from “Non-Ideal” HR – 5-Year Impact
($200,000)
Legal & Compliance Costs (HR) $50,000
($210,000) $600,000
Employee Productivity
WC Exp Mod Reduction ($17,325) $47,250
SUI Rate Reduction ($14,280) $41,438
Health Insurance Increases ($92,686) $224,586
Turnover ($123,300) $369,900
Owner / Exec HR Hours ($8,885) $5,872
Administrative HR Hours ($5,128) $12,821
($300,000) $0 $600,000
© 2010 PEO Consulting Group, Inc. Used with permission by HROplus.

21. What's the Cost of "Status Quo" HR?
Potential Profit Five-Year Illustration
Cumulative Net Profit Difference
Difference Swing:
$1,361,059
$2,026,921
over 5 years $752,439
$233,165
$0
($71,468)
($447,475)
($665,862)
Now 1 Yr 2 Yrs 3 Yrs 4 Yrs 5 Yrs
© 2010 PEO Consulting Group, Inc. Used with permission by HROplus.

22. Request for Proposal
Will HRO work for my company?
Let's see…check out…
www.hroplus.com/quickquote
© 2010 PEO Consulting Group, Inc. Used with permission by HROplus.