Human Resources and Financial Success Are More Related Than You Think
Getting HR and financial departments in an organization to work together effectively is a daunting challenge. If their goals aren’t aligned, though, organizations are destined for failure if they take this approach. But what if the two departments were actually built on the same foundation? The result is that both would share the same goals. Having this common foundation helps organizations achieve success because both HR and finance play important roles in creating a successful organization.
Same Organization, Different Goals
Human resources and finance are both important parts of an organization, but their goals, processes, and resources are often very different. HR is responsible for employee satisfaction, recruitment, and training. Finance is responsible for budgets, cost-cutting measures, and financial success. Despite the differences between their roles, HR and finance must work together in order to be successful.
The Role of Human Resources
Human Resources (HR) is the department in charge of the hiring, training and development, and benefits of the employees. The HR department doesn’t usually handle on-the-job training, but they often do the pre-employment training. HR departments do just about everything related to the employees: hiring, firing, and all the in between. They are a liaison between employees and management.
They deal with payroll issues and benefits, both of which are very important to employees. In fact, some companies have been known to offer benefits that go above and beyond what is required by law, in order to attract good talent to their business. HR is also responsible for employee relations. This includes dealing with complaints from employees as well as legal proceedings such as lawsuits against the company for discrimination or harassment cases.
The Role of Your Finance Department
Finance is the branch of management concerned with money, investments, and other financial matters. Finance deals with the numbers side of business operations. It also includes the control and monitoring of cash flow, the generation of reports to keep track of inventory and finance, and the procurement and management of supplies and equipment.
Finance is one of the primary functions in business, especially in companies where a large amount of capital is required or financing is involved.
Build an HR-Finance Partnership
There is no question that getting the right people on board is the most important thing your company can do. In fact, it’s the first thing that you should be doing, and it’s probably the only thing you should be doing in terms of business development.
Trying to sell something to someone who isn’t right for the job can mean epic failure. That’s why hiring and recruiting are so crucial.
But there’s more to it than choosing candidates with the right skills and experience. A lot of companies overlook a key component of recruitment: finance. To be sure, companies must take a financial risk when they hire new employees, especially if they’re adding positions that don’t already exist. Take this risk into consideration when you’re deciding whether or not to hire new people.
The bottom line is that HR and finance need to work together, whether you’re looking for a new employee or deciding whether or not to increase headcount. This means knowing what’s going on in both departments and what factors play into financial decisions about recruitment and hiring practices.
HR and Finance Are Two Sides of the Same Coin
From the outside looking in, HR and Finance seem like two separate entities. HR is just getting payroll done while the Finance team makes sure the bills get paid. But they’re really both part of the same organization, so you need to make sure that they’re supportive of each other.
Get in touch with us at John Warekois CPA, LLC for further information or assistance with your small business.