No matter how well a company is structured, the truth is people are its greatest asset. With all these, you might’ve noticed that people come and go, meaning companies don’t always invest in the headcount.
While there’s clearly a connection between money and people, there’s also a disconnection between the departments dealing with these things: human resources and finances.
Most people don’t realize it, but that’s when problems arise. Things could get significantly better if the HR would partner with the finance company department, yet leaders often fail to see this connection.
These being said, let’s explore these connections and how they can help your business.
Main Benefit: Human Resources Can Become a Partner
The human resources department is a strategic asset for a company. If you’ve worked in a big company, you might’ve noticed everyone’s focused on numbers. People check wages on spreadsheets, complete all sorts of forms and analyze statistics in order to figure out what’s going on.
If you think about it, that’s a few good hours a day. That’s more than 10 hours a week and over 520 hours a year. Do the math and see how much a company will lose on such useless tasks.
Everything would change if the HR could partner with a finance company. The HR department will find much more time to collaborate with other departments, not to mention streamlining processes and improving overall efficiency.
Now, this wouldn’t necessarily matter, but for most companies (especially the big ones), having up-to-date information means the HR department is equipped properly to build strategies along with the finance department.
Headcount planning is another major benefit of such a collaboration.
Simply put, it’s all about aligning the goals of two different departments.
Second Benefit: Workforce Investments Can Be Proven
HR planning is tricky. When you count investments, your competitiveness as an employer, the ROI and talent development, finding a mix between all these can be a serious challenge.
These days, most HR departments focus on people. The culture is important, not to mention the experience of each employee. People would rather do this than focus on reviewed financial statements or other similar things.
With a constant request for extra budget, HR teams are often left to deal with whatever they have. They’re less likely to get too much extra anyway, so they usually rotate money from one task to another.
On the other hand, if they could partner with the finance company department, they’d be able to eliminate the middleman. The requests, the hassle, constant denials, the idea of giving up, all these things would be history.
A good partnership makes it simple to align goals, but also to prove the necessity of workforce investments. For example, when proposing a new employee training program, HR could work with finance to forecast how enhanced skills might reduce operational errors or accelerate project timelines.
When these two departments work together, HR teams can work with finance to develop new ways to match investments. It’s an invaluable partnership that everyone involved benefits from.
Third Benefit: Higher Productivity and Profitability
A top-notch collaboration between HR and finance will promote a better-informed environment. Everything is based on data and numbers. Decisions are more accurate. Spending is smarter, whether it covers wages, talent growth, development or culture.
Once again, you may have noticed these issues if you’ve worked in a big company before or if you’ve had a leading position. In general, finance works alone in assessing expenses and identifying results. From bonuses and compensation issues, everything is assessed by finance.
The problem is these things don’t necessarily cover everything.
Many aspects are overlooked because finance doesn’t have access to all the HR data. For example, turnover costs aren’t just about severance pay but also the hidden expenses of lost productivity, recruitment fees and onboarding time. HR can quantify these key details but finance might not prioritize them without collaboration.
Collaborating with the human resources department means finance will get a bigger image. When you have all the data, making an impact becomes a piece of cake.
But that’s not everything. This type of collaboration will also provide deeper insights into people’s data. This way, finance can make better estimates when it comes to budgets. The department can also optimize potential expenses and costs.
Based on this accuracy, HR will also benefit by offering better contracts, more benefits and a better overall experience at work. It’s all about the culture at this point.
Higher employee satisfaction will only add to the profitability of your company, as well as the productivity throughout the workforce and morale. When teams feel supported and valued, they’re more likely to innovate, collaborate and drive results that fuel growth and success.
Bottom line, this fractured connection between two vital departments is obvious in many big companies. According to the book, these departments must work together in a tight collaboration in order to handle workforce planning.
Human resources will provide a wider perspective to the planning process and act as a supportive force for employees. Finance has the outstanding possibility of taking this perspective and implementing it for better ROI and productivity.
Overall, this is the type of match that will add value to a company overnight. And even though some managers or leaders are aware of it, failing to implement it properly won’t bring in any viable benefits in the long run.
Guest writer
