The Biggest Mistake A CFO Can Make When Managing The HR Department
It’s in the CFO DNA strand to constantly be calculating risks.
Whether it’s budgeting, forecasting, buying healthcare, contemplating layoffs…the main focus is usually on avoiding mistakes in order to make progress.
Keep the ship afloat and on course.
That’s how a company remains sustainable, right?
And when it comes to buying new things for the business that weren’t needed, it can be a tough dilemma. You don’t want to spend any of your budget on unnecessary software.
People should just do a good job. They didn’t need this before, and their job hasn’t changed, so why do you need to spend more money?
Well that’s where mistakes are happening for CFOs today.
There’s a major blindspot when it comes to Human Resources…How it’s managed. How it operates. And it all stems from how it is perceived.
Thinking that HR is a cost center and has no Return On Investment.
And that’s where HCM (Human Capital Management) comes into play.
There is data in your organization that you are missing, and that’s leading to uninformed and miseducated decisions for the organization.
What’s worse than having outdated systems and thinking it’s ok?
Having no system at all.
And it’s more than just tracking data that CFOs are missing out on, it’s running a smoother operation that is more efficient, profitable, and sustainable.
Let’s take a look at what fixing this blindspot will mean for your organization.
Why Are Your Employees Consistently Underperforming?
You know what’s easy and cheap?
Bad hiring practices. And that is obviously a mistake that leads to high employee churn, low engagement and performance, and having a low quality company that no customers want to do business with and no employees want to work at.
Skimping on your hiring is like eating fast food every day. It’s so convenient, and it didn’t kill me (yet). But if you build your life eating fast food, bad news, you’re in serious health trouble.
“But great recruiting, applicant tracking, hiring, and onboarding are HARD and EXPENSIVE”, I hear you say.
Well, they used to be anyway…
Imagine life where it is just as easy to recruit amazingly talented people who were a great culture fit for your organization as it is to hire the most recent resume-blaster that was scrolling through Indeed?
That’s what the right HCM system does for you.
Stop Limiting Your People’s Value
Are your employees sleepwalking through the drudgery of their work days?
Or are they excited and amped up about what you are doing as a company?
Employee drudgery happens when people don’t feel valued or see a reason to do great vs. enough to get by.
Think about Office Space.
They’re doing just enough to not get fired.
You don’t want that happening.
If it’s happened over time and you’re recognizing it now, that’s a great thing because you can take action on making changes.
But if you let that continue…
Start treating your people the right way and arming everyone with what they need to do a great job and they will become high ROI assets in the business.
Did you know that HCM technology returns an average of $9.13 for each $1.00 spent?
That’s according to Nucleus Research. They also have this to say about the ROI of Human Capital Management:
“Nucleus has identified the two main factors contributing to the return on investment (ROI) of technology for human capital management (HCM). From them – automation and the cloud – cascade an array of direct benefits and productivity gains. These factors, also fundamental characteristics of modern technology for HCM, are common denominators of success across many industries and employer sizes.”
When you are using a system that can easily measure, manage, reward, and find areas of improvement for your people, you are going to win.
The Win For Employees
Using automation and cloud technology provided by a modern HCM system is going to save time on employee tasks, lower the potential risk of errors in data entry or migration, and free up people to execute on more impactful work.
And it’s also going to create measurable results.
This means everyone will be able to see how well they are performing, encouraging them to keep getting better. Or in the negative cases, show the areas that need improvement before it becomes a fatal issue.
The Win For Management
Measured = managed and improvable.
With one system in place for all of your HR work, you can easily look at your dashboard to see the ups and downs, where to invest more, cut off, and where improvements are needed.
When you can see this information, you can make better decisions for the company’s direction, efficiency, strategy adjustments, tools, and budgeting.
A major win for management and decision making.
The Win For The Company
Now we have engaged employees with a clear vision and understanding of achieving high performance and what that will mean for their careers and the company as you are growing.
The management team is fully equipped with the right information to make the best decisions for moving the company up and to the right.
This all leads to a high quality, profitable, and sustainable organization.
A Win-Win-Win for everyone!
Clean Up The Waste
Another big mistake for CFOs is the amount of inefficiencies in systems and workflows.
This is time poorly spent and high risk for potential errors.
Neither of which should be acceptable at this scale.
But for some reason it’s happening every day.
Not to mention if you’re using different systems and something gets quirky, your employees have to go back-and-forth 7 times between two different company’s customer support people who are pointing the finger at each other instead of helping resolve an issue that should probably have taken 5 minutes.
The Easiest Way To Fix These Mistakes?
Work with your HR team to review your current systems and processes.
Where have you just been winging it?
How many different HR tools do you have in place that could potentially be consolidated into one, much more powerful Human Capital Management system?
Where Do You Go From Here?
We know that organizational success stems from employee success. Without the right strategies in place, you are wasting money at every stage of your employees’ lifecycles.