We may never Agree Post 5 of 5

This is the final post in a series

 

 

 

 

 

 

 

 

 

6. Response

 

Your right it is going to be difficult to agree. However, I like your thought that to sit at the table you need to have strategic impact. However, based on your own positions, how can HR have a strategic impact in Talent Management if they don’t influence; the talent needed, what is going to attract the talent, what is going to retain the talent or even make the decision to acquire the talent. You see the point is that HR should partner with the other departments on this strategic goal, not just play a role.

 

I am not confident if organizations are serious about improving the daily life of each employee or executive. But if that is a strategic goal, HR will not be able to do it alone. HR will have to partner with other company leaders and do so in a measureable way where responsibility and accountability can be objectively applied. Otherwise you end up with just another HR program that may or may not have any impact.

We may never agree post 4 of ?

The dialog continues from my previous post

---------------5.Original Message---------------

I guess we are just not going to agree on this. Here are a few points in response to your note: If HR's contribution is Cost Controls then it will not have a seat at the table. You sit at the table if you can have global strategic impact.

Strategic HR impact is primarily in Talent Management. Having the right people in the right seats at the right time. That is how you add value. If you can deliver this you get a seat.

HR should not have a say on head count. Operations people need to be able to determine the optimal staffing. HR can offer counsel, guidance and advice but not own the head count. HR can find the best candidates for the positions and that is how they earn their seat.

Broker commissions, self insurance are fine ways to control costs but as you know they are only a very small part of the total cost of providing the benefits. And once saved, they are one time savings.

You went on to discuss increasing sales. Companies do not just ask for higher sales from their staff. What they want is increasing net profits. The targets for the increased sales are determined in advance with the factors you enumerated taken into account. Bonus are paid based on selling high net value products not based on the $ volume of sales. So yes the sales staff does have control over this by picking the right targets to sell to and not selling products merely to get the sales dollar volume up.

To get the seat at the table HR has to provide Strategic improvements. Better staff, better assignments for high potentials, better HRIS systems (like implementing cloud based systems) etc. Think how HR can improve the daily life for each employee, each executive and you will be asked to join the senior management. Bring solutions to these kinds of problems not merely cost controls.

Regards,

.____.__

 

We may never agree, post 3 of ?

The dialog continues from my previous post

4. From: msalisbury001
Sent: Monday, February 03, 2014 7:12 PM
Subject: HR Department Alignment to PSFIN Department?

If you're not going to at least share the responsibility then how can you be credited for making a contribution? Look at it this way,

If HR wants a seat at the table they should have some say in the head count. HR should be the lead in designing the compensation plan, how much is available and how it is distributed. Also, HR has significant control over benefit cost even after the benefit plan design has been decided upon. For example, is the broker paid a commission or a flat fee. If it is a commission there is an immediate opportunity to reduce the annual contribution to the Defined Benefit Plan. And for larger firms, there are also opportunities for cost control associated with self insuring the benefit program.

Additionally there is the positive financial impact of an effective wellness program, which does offer the prospect of control over benefit claims expense. Also consider a safety plan that reduces accidents and workers compensation costs. You would be surprised at how much money HR can save the firm by taking these factors into account. And if HR is not doing a good job of encouraging employees to sign up for and maxing out on 401(k) contributions, it is not doing a good job of saving payroll taxes for both the employees and the employer.

If HR is not able to contribute to ongoing cost containment then what is the value of having them around after the programs are designed and implemented? Consider the sales leader. If plans call for an increase in sales orders, an increase in market share, an increase in sales pricing, and an increase in profits, do they have much control over these factors. Don't they have to combat a series of forces that are working against them like the completion, unexpended changes in demand, conflicting market trends, unexpected consumer alternatives, etc. Yet in spite of these obstacles that interfere with control, the sales leader accepts the responsibility and moves forward. So too can HR.

I encourage you to give some thought to creating an environment where HR, Finance, and other departments work together to establish and achieve mutually shared objectives rather than take the position that someone else should set the objectives and there is simply a hand off for HR to implement

We may never agree post 2 of ?

The following is the response to my original comments

 

Sorry but do not agree with your response. HR is not responsible for Benefits or Compensation and does not own these expenses. Why do I say that?

Look at it this way. Who determines the headcount in each department? Who approves the compensation of each person and their earned bonus? HR? Not really.

Benefits are designed to meet a company goal/need. Once the designed is agreed to, the cost is not something HR has much control over. Can HR control benefits claims expense for medical plans? Nope. Can HR set the annual contribution to a Defined Benefit Plan? Nope. 401(k)? Nope.

HR's involvement these programs occurs when they are designed and implemented. After that the annual expenses is generally out of HR's control.

Alignment of HR to Finance (or any other department for that matter) can only occur at the Department Goals objective. Once Finance sets it goals for the year, (for example increasing or decreasing headcount), HR can implement plans that will support their objectives. And of course the Department Goals must be aligned with the Corporate Goals.

My next blog will document my retort. Stay tuned it gets more interesting....

We may never agree post 1 of ?

The following blog will tell a story. The story is real and is about the future of HR. I expect many to disagree with the story's lessons but you will have to wait until the story unfolds one day at a time. This blog is day one of the story. The introduction may seem boring and even innocuous, but you need to know where the story begins or you will miss the point.

1 Question HR Department Alignment to PSFIN Department? How are you doing this? How are is reporting aligned?  2. Response

I assume your referring to Public Service Financial departments and the HR department alignment. If that is the case here are two examples of alignment and how to report it.

1. Finance generally is responsible for the budget and HR is generally responsible for the single largest operating expense, benefits and compensation. Therefore there are a number of ways for finance and HR to collaborate on how to manage these expenses so that they become an investment and deliver an ROI. It would not be too difficult to construct a benchmark, set up an objective, measure the objective with metrics, graph progress, and establish a regular reporting and review process.

2. Finance generally allocates costs such as legal fees for employment claims to the department that incurred the charge. As a result, HR is not held accountable for these expenses and they should be, if HR is going to have an impact on the organization. HR and Finance can work out what I refer to as shared objectives so that multiple departments are held responsible for containing cost and all participants benefit when the predefined objectives are met.

Call me if I can be of further assistance.

Mike Salisbury Principal HRA 818 970 0730 hralliance@att.net