The Importance of Human Resources: How to Gauge HR's Value
The early stages of a business are great way for any department to prove the value they bring to the organization - especially HR. However, when things start to stabilize and the growth cycle plateaus, how does your HR team demonstrate the ongoing value of the support they provide?
It’s easy to overlook the need to answer this question while you’re focused on sales, production, or other more client-facing departments, but it’s important not to. As your organization grows and evolves, so too should your HR. So, what do you do to keep your department involved in your company’s yearly goal setting?
What Do You Do When the Growth Curve Ends?
You’ve reached a point where you’re not growing your team and business is relatively steady. If anything, you’re replacing people due to turnover, not growth. What can a human resource manager do at this point that increases their value to the company?
For one, you can strengthen your personal employee network. Part of HR’s responsibilities is to be an employee service center and advocate for their needs. While it’s easy to be very good at hiring and addressing employee concerns, it’s more difficult to dedicate the time to relationship building with current staff.
This can be particularly valuable in positions that tend to have a higher turnover rate. HR can proactively get to know employees, the jobs they do, and what complications arise. Is the job itself hard? Is it a manger or a coworker that drives folks away? What are some fixable issues that are driving employees away?
Engaging with employees and supervisors to find ways to improve retention can be exceptionally valuable when it comes to money, time and resources. The potential cost savings from decreasing turnover alone can be worth it and really help your HR department demonstrate long term value. It’s estimated that the cost of losing an employee ranges from 1.5-2 x their annual salary. HR officials don’t have to wait for a problem, but can take the time year-round to reach out to employees and proactively address issues that may result in higher turnover.
Should HR teams join company planning discussions?
Every company has goals and plans. In order for any department to contribute to these organizational goals, they must be included in the planning strategy somewhere along the line. Everyone in the department also needs to understand how their role ties in to the established HR goals, and subsequently, the company's strategic priorities.
As an HR manager, request to be part of company planning meetings and explain how your participation is key to the organization’s overall success. Once you have a seat at the conference table, take the time to research and come up with tangible ways you can contribute. Are there training grants in your state to take advantage of? Is there a specific college that specializes in a needed position in your industry? Could you do recruitment there? These are just a few specific examples, but the bigger point is to ideate some ways you and your department can continue to demonstrate ongoing value alongside other areas of your business.
If HR is not included in these meetings, does anyone notice? Business leaders should be aware of HR’s absence. If not, there are a couple potential reasons that could be concerning. One of them is that your leaders do not value the contributions from the HR dept., therefore do not think it is a problem if they are left out. Another reason is that your HR professionals are not offering value or contributing to discussions. Make sure to talk with all leaders and figure out how to improve this.
Is your HR team adaptable?
A situation found in many more established companies is a tendency to keep doing things “how we’ve always done them.” Does your HR team fall into this trap, or are they adaptable to a changing economy, employment landscape and company direction?
There will often be some rules and policies that can’t be adapted, but overall, an HR professional should be reevaluating the way the work on a regular basis. According to a study conducted in the UK, 17% of respondents did not believe their HR teams were doing a good job. One of the main reasons was that they failed to adapt to the changing business economy.
If an employee or manager seems difficult, instead of blaming or reciting years-old SOPs (Standing Operating Procedures) your HR professional should pay attention to their communication style and adapt accordingly.
New generations of the workforce care about different things, their work ethic and values have changed. Instead of lamenting and fighting this, HR should embrace it, be adaptive and find the best way to work with all aspects of employees. This also applies to newer HR departments dealing with seasoned employees. A good HR professional should find a way to work with all employees.
How Aspirant Can Help
Aspirant's Organizational Effectiveness experts can help develop and socialize a cohesive plan that keeps your company rowing in the same direction. Use the form below to request a casual discussion about how we can ensure your HR team is properly recognized for the value of its contributions.
Any questions or feedback? We'd love to hear from you.
Judy partners with executives and leadership teams to engage and inspire employees in a way that delivers sustainable strategic results. She brings deep expertise and creative ideas to solve organizational effectiveness issues and closely collaborates in a way that builds internal capabilities. Judy has spent over 25 years consulting in a variety of industries, bringing her expertise in behavior to a wide range of organizational issues including organizational behavior change, leadership, change management, culture and engagement.