Show Me The Money!
I had the pleasure of attending a Mega Session called “Show Me The Money” in Orlando during the National SHRM 2014 conference. The presenter was LaFern Batie of The Batie Group.
Ms. Batie challenged the participants with what many have been encouraging HR professionals to do for years…understand the finances of the business!
In a nutshell, Ms. Batie told the audience that HR professionals need to get comfortable with money! That is, they should know where the money comes from and know where it ends up. They should know what the organization’s plans are for making more money and know how its competitors plan on stopping them from doing so. Finally, they should know how the business’ operations can save as much money as possible with increased quality and efficiencies.
More importantly, Ms. Batie emphasized that HR professionals, when they understand the ins and outs of the organization’s money, will quickly see how they can positively affect the “flow” of money for organization.
I agree with Ms. Batie – her philosophy fits in nicely with what I have been advocating for years:
HR should never be satisfied with being a line item that simply sucks money out of the coffers.
Instead, they should strive to be a program that not only helps the company make money but helps them save money too!
Consider the following areas in which HR can “save” or “make” the organization money.
Workforce and Leadership Development
HR Professionals can help ensure a company’s investment in its workforce yields good returns. HR should help managers perform needs assessments, identify training or development opportunities, develop competency models and improvement plans, etc.
If HR can give managers what they need to ensure their employees are well trained for the jobs they do, the organization should see less errors or “do-overs”, increased efficiencies, heightened “service” which may result in repeat or new customers, etc.
Furthermore, if HR can mentor and coach managers and supervisors on issues affecting employee relations and performance management, the organization will likely see reduced complaints/grievances, reduced turnover, increased engagement and productivity, etc. All of these things help an organization increase their revenue.
If HR can provide a framework for managers to identify potential successors and “permission” to develop and/or prepare the employees in that pipeline, the organization will benefit from a decrease in “time to hire” when vacancies occur, an increase in “hit the ground running” time, and an increase in “fit” for the positions. These issues play a direct role in productivity, which, of course, greatly affects revenue.
HR professionals sometimes say that performance management is up to the supervisor and I agree…the actual activities are indeed on his/her shoulders. But HR needs to coach/mentor the supervisors and needs to provide the framework and/or tools for effective performance management. It’s not rocket science…we all know this…but nonetheless, many supervisors are overwhelmed by it!
HR needs to provide the process, explain any tools or “rules” that the organization has within the process, and support the supervisor when he/she has to deliver uncomfortable messages throughout the process.
HR professionals, when they work with supervisors with performance management, will be indirectly ensuring the organization makes more money.
Internal Process Management
It’s been my experience that this one eludes the HR professional the most. As a matter of fact, I daresay HR programs are the epitome of process slaves. What I mean is HR professionals have a tendency to do a process “the way it’s always been done.” Even if they are lucky enough to automate it, they automate the “old way” instead of capitalizing on what technology can do to save time, increase quality, decrease duplication, etc.
I am a LEAN practitioner, and over the last few years have facilitated numerous “process improvement” events for my clients. I’m proud of the teams I work with as they have saved their organizations thousands and thousands of dollars each year simply by improving their processes.
How do they do it? They thoughtfully but critically look at their current process, and honestly evaluate how much it costs, what the quality/value is to the customer, etc. They then identify a better way, a quicker way, or a more value-added way. And finally, they commit to performing the process the “new way” no matter what – which means they don’t allow themselves to default to old habits or comfort zones.
I get tickled each time these teams present to executive leadership or their Board of Directors because not only do they they typically start or end with a message about “finding a lot of money” but they always have a story to tell about their newfound or newly generated “commitment” to the organization. Show me the money indeed!
The above areas are but a few ways HR can make or save the organization some money. Ms. Batie encouraged the audience, and I encourage you now, to take it upon yourself to take a closer look at the ins and outs of your organization.
The money is there…you just need to find it!