BRIDGING THE GAP BETWEEN FINANCE AND HUMAN RESOURCES
Globoforce has announced the results of its research study that focused on the importance of bridging the gap between the finance and human resource functions to drive success in today’s global organisations. The study, which revealed five key findings related to closing this costly gap, illustrated the clear need for more consistent collaboration between finance and HR, specifically with the emerging role of Chief Talent Officer (CTO) as the next vanguard of corporate governance. More than 250 HR and finance professionals from global 2000 organisations participated in the survey. All of the respondents are from organisations with more than 10,000 employees engaged in global operations.
Key findings of the study include:
Human Resources Must Take a More Strategic Role in the Business: The role of HR has evolved, and in today’s business climate, HR is not only expected to take a more strategic position, but also to quantify work with appropriate metrics and substantiate ROI. The study revealed that although 87% of respondents believe that HR should play a more strategic role than in the past, only 63% believe HR has the right amount of input in the company’s strategic direction. A full 91% said it is more important than ever for HR to be accountable for spending, with 88% noting that HR must embrace a more metric-based standard for measurement.
Emloyee Recognition Drives Engagement and Therefore Impacts Recognition, Retention, Productivity and the Bottom Line: Engaged employees are more likely to be high performing employees who are less likely to leave their organisation. As such, when asked which HR metrics were most important, the top three responses were employee engagement (71%), employee productivity (63%) and human capital ROI (57%). Respondents were near unanimous (99%) when agreeing that they believed that employee recognition improves engagement and productivity.
Creating a Universal Recognition Platform for Global Companies is Difficult:The majority of respondents (80%) believe that addressing the needs of global employees is difficult, and 58% said that creating a universal recognition platform for a global company is difficult. Only 66% indicated they have a universal platform for recognition.
CFOs Are Not Aware of How Much They Are Spending on Recognition Programmes: Although nearly everyone agreed that HR and finance need to be on the same page, only 58% of respondents say this is the case in their organisation. When asked if their CFO was aware of how much their organization spends on recognition programs, only 58% said yes. Only 52% said there was a metric/plan in place to measure the effect of employee engagement on company performance. Moreover, even though best practice suggests that finance is the business unit that should require ROI, few survey respondents (36%) indicated that finance was taking a leading role in HR processes, programmes and technologies.
The CTO and the CFO Must Work Together to Chart the Course for the Future: Survey respondents overwhelmingly said (95%) the CTO and CFO should work together to chart a new course for the future. However, a disconnect clearly exists when only 58% said this was currently the case in their organisation.
Derek Irvine, vice president of Global Strategy, Globoforce, said: “As this study shows, leaders also understand employee recognition can improve employee engagement and – by extension – their bottom line, shareholder value and customer retention. To get there, it is essential that today’s global companies bridge the current gap between finance and HR, empowering these functions to collaborate on this new strategic imperative and ultimately implement a universal recognition platform that motivates, retains and attracts great talent.”
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