Cash News
Finance and human resources (HR) have often been viewed as diametrically opposed corporate forces. The number crunchers in finance, the caricature goes, begrudgingly dole out dollars while eyeing the bottom line; HR, meanwhile, is filled with chatty extroverts who revel in recruiting talent – and spending the organisation’s money in the process.
The truth, of course, is that profitability and human capital are intertwined: people are usually a company’s largest cost, yes, but also its biggest asset. And ultimately, both finance and HR are focused on driving better performance and business results. Organisations seeking agility must find a way to reconcile finance’s cost-focused approach to headcount planning with HR’s more holistic view of the employee journey. In doing so, they can achieve a more strategic approach that focuses on the cost of salaries, benefits and turnover with a lens that examines skills gaps and ways to improve company culture, so strong contributors remain with the company well into the future.
No business can afford to keep its finance and HR functions siloed. Finance must move beyond viewing headcount merely as a cost centre and explore ways in which salary, benefits and other motivational HR levers can be pulled to meet operational needs and boost profitability. HR, meanwhile, must take a disciplined look at the cost and advantages of hiring new workers and implementing benefits programs, as well as current and future workforce gaps that threaten to limit a company’s success.
By joining together to plan, measure and optimise talent, finance and HR teams can elevate workforce planning from a static exercise that attempts to guess future needs to an active process that’s able to adjust to constantly changing operational realities.
Today, decision-makers in finance and HR largely recognise this overlap in duties, and they see the need for a more modern approach. But many remain embroiled in an outdated struggle for control. In fact, one study from a few years ago showed that 55% of finance executives believe that strategic workforce planning should be their responsibility, while 76% of HR leaders said it should belong to them. And when it comes to workforce costs, 88% of finance leaders said they should exert control, while 55% of HR executives believed it’s their domain.