HR needs to prove link between staff spend and profits

Proof of the link between personnel expenditure and profitability should be an invaluable way of getting better HR representation on the board (‘Good human resources will boost your company profits’, Personnel Today, 26 February).

And surely, with the prospect of increasing profitability by £1,500 per employee, even the most cynical chief executive would see the business benefits of a successful HR function? So it seems absurd that there are still business leaders who don’t appreciate the value of an HR director working at the highest level, providing input on a company’s most valuable resource – it’s people.

Taking a top-down approach

Improving employee engagement – thereby increasing profitability – will only happen with buy-in from the very top of the business, with the support of the managing director or the CEO, which filters down into the rest of the company. This can only happen if there is an influencer in the boardroom to convince the other business heads of the profitability of good HR practice.

However, in other parts of the business perhaps less is more when it comes to HR’s visibility. Improving HR practices means increasing employee engagement and taking more time over training, resourcing and getting the right benefits for the right people. All this amounts to HR having regular contact with employees.

In these circumstances, businesses must be careful to avoid ‘initiative fatigue syndrome’ among employees, where HR directives are greeted with a sigh and pushed to the bottom of a to-do list. For while improving engagement is crucial, it’s equally important to avoid too much interaction. No-one likes to feel too ‘managed’ by the HR department, and it’s easy to get frustrated by seemingly pointless new initiatives, endless surveys, feedback forms and analysis. These HR requests take time away from core business activities and the immediate benefits aren’t always clear to anyone outside HR.

Taking a back seat

How much more effective would it be if line managers and team leaders were involved in new HR initiatives? The best way of ensuring employee buy-in to HR practices is for HR professionals themselves to take a back seat when it comes to implementation of ideas and letting line managers take the lead.

It’s vital that HR integrates with the rest of the business, so important tasks, such as employee feedback surveys, aren’t categorised under ‘HR’ on the to-do list and get pushed on to the back burner. If the instructions come from a line manager rather than HR, the job will be taken more seriously and managers themselves will take responsibility for getting things done.

Advances in technology mean that collecting and analysing information from large numbers of people is now simpler and easier than ever before, so there’s no reason why managers can’t implement this kind of initiative themselves.

HR processes should be seen through from start to finish by managers. HR is there to support, analyse, benchmark improvements and present findings back at the very top of the organisation. However, when something works well, the credit for success should be passed on to those managers who have been involved.

Taking responsibility

For new directives to be successful, it’s important to get those involved excited about the task and feeling responsible for its success.

Rather than leaving HR employees themselves feeling invisible and demotivated, this approach takes much of the procedural work away from HR, leaving the department to concentrate on strategy and contributing to business success. Working in this way also frees up time to present results back to the board in the most effective way, calculate the profitability to the company and convince the chief executive of the business benefits of sound HR practice.

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