As a leading management consulting firm, we can help. Here are some tips to consider:
This part leads to all the other steps. You can’t know everything that’s going on in your company, so check in with the leads and influencers for each department to get a better idea of needs that may affect your budget.
These are positions you know need to be filled. How long have they been open? Do you have the right comp plan? Do you need some outside help, like from an RPO service? Should you be putting an ad on LinkedIn, Indeed, or elsewhere? Chances are you will be spending money to fill these positions. Figure out how much.
Are you adding products or services that require new hires? Is a particular department growing quickly and in need of additional leadership? What is your projected turnover rate? Look at past trends to help forecast this and anticipate the money spent searching for and hiring the right candidate. Hiring and training front-line employees often costs 30% of annual salary. Hiring for leadership positions can cost 213%.
New hires need training and time to acclimate to a new job. Whether this is in-house training or external, there will be additional costs to the company. For internal training, be sure to account for the cost of pulling someone from their daily work for training as well as the hard costs of registration fees, travel and any other incidentals.
Are there key employees who have been on an upward trajectory, routinely achieving their yearly goals? People that you expect to put a little more time and money into development? Promotions don’t have to be a new title, but they can include pay raises and additional responsibilities. To execute the plan properly, employees may need leadership classes, retreats, etc., which need to be considered in the budgeting process.
Whether its leadership groups for C-level executives, or software-specific groups for programmers, there are many beneficial groups employees can join. Most groups have some sort of fee or dues. Take the time to see what’s available and if there are any expenses that sneaked through last year's budget. Anticipate any expected new additions.
Want to to take a deeper dive into HR planning? Download our e-book, Workplace Trends for 2025. Or check out our Ultimate Guide to Team Accountability.
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