Most human resources departments are overseen by executives who don’t truly understand the value the department brings to the organization as a whole. Most executives see HR as the administrative wing of the company – the place where people get interviewed, hired, and ultimately fired. But HR is so much more than that. The amount of information that flows into human resources departments and the strategic decisions made there that can make or break companies are just a few of the many ways this department is so valuable.
If you’re struggling to find ways to prove the worth of your human resources department to the company executives, here are five things to help you get started.
- Use metrics to show how the HR department helps save money.
Numbers talk. Show your executives the different metrics that prove, in black and white, the financial worth of your department. Executives see numbers as a straightforward, proven record of the value your department provides. Reporting on key metrics like workforce productivity, recruiting costs, and retention, and creating specific goals and meeting them are sure-fire ways to develop a strong relationship with the executives at your company.
- Create an efficient culture.
One of the main focus areas of human resources departments is making the company culture more efficient and productive. This is built on things like employee morale and engagement, management satisfaction, and developing processes around recruiting and training that save the company money in ways that other departments aren’t able to. By carefully selecting your workforce and developing employee management processes that protect the company against future lawsuits, your department will be able to save your company time and money.
- Show how HR innovations can change your workplace.
The number of new HR technologies currently being used in today’s workforce is remarkable. The HR technology industry itself is a 4.1 billion market, and it’s growing. If your C-suite level executives are wanting the company to innovate and be ahead of the trend, it’s important to understand the most valuable part of the company: its employees. The HR department has a very important role in finding and developing the employees who are going to plant and develop the seeds of innovation and growth.
- Show strategic value in placing employees.
When it comes to the strategic direction of the company, HR also plays an important role. HR directors or CHROs should sit on the company board so that they can keep board members informed about the state of the employees within your company. I’ve said it before, but the employees are the most important resource in your company, and having a representative from your HR department sit on the board will allow for the employee point of view to have a strategic say in how the company is run.
- Predict future company needs through human resources.
While no one has a crystal ball, the beauty of HR data and analytics is that they can help predict the future of your company’s personnel needs. The amount of critical data that flows through the HR department can help direct future development. By keeping tabs on productivity and determining how many and what kind of new employees the company will need to hire in the near future and well beyond, HR can provide the kind of forethought that will allow your company to not just survive but thrive in the changing markets to come.
These five data points will help your HR department prove its worth to your company’s top-level executives, and might even get you a seat at the C-suite table.
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5 Comments
When a department is forced to justify its value, I think there is a problem somewhere. I do not think that a good manager would question the effectiveness of the human resources department when things are fine. I find your article topic, and even the title, a little strange. Why should a department have to demonstrate its value and why should it bring arguments in its defense? I agree with this situation only when a serious problem occurs, when the selected personnel prove to be unfit, or when the selected employees are not compatible with the job.
Your suggestions in this article are very interesting. You put the problem of the worth of the human resources department in a trenchant way, almost comparing it to an accountant. I think, though, that no one can deny the importance of the human resources department, for the most important asset of a company is made up of its employees. Without employees, no company can evolve and be profitable. A human resources department makes a huge contribution to the smooth running of a company, whether it’s a large company or a small one.
I think that the true value of the human resources department would become very apparent when the staff of this department doesn’t work properly anymore, when the employees cannot look to the department for the solutions to their problems, or when they cannot communicate effectively with managers or be heard by the executives. In general, the human resources department works rather behind the curtain, having more of a negotiating role or one of peacemaker between management and employees. Its value is priceless, in my opinion!
I think a good HR department can truly make a difference in the smooth running of a company. After all, this department is the one that serves as a buffer between employees and management, ensures and promotes organizational culture, and always manages to find the right solution for all parties involved in any conflict. And I do not say this because I work in this department. I’ve occupied a leadership position in other departments, and I think that the mission of a manager is much easier when he or she has a good HR department beside him or her.
Proving your worth is not exactly the best way to earn recognition. I do however think that as an HR professional that it is important to understand the value that happens in the department and how it does have a direct impact on the company, its employees, its customers and the community. It is a challenge to communicate to the C-Suite the broader viewpoint but when they consistently hear of impact that is happening through the efforts of the HR department, it will naturally give the recognition they seek.
In my 20 plus years working with HR Professionals, I cannot tell you how many programs I have attended that the goal was to help the HR pros gain a seat at the table with the C-Suite. This article has some good suggestions.
I have written an article called 10 Steps to the C-Suite and would be glad to hear your feedback. Just send me an e-mail and I would be glad to send it to you.