Consider how HR drives the bottom line

The recent challenges around the pandemic have caused a lot of strife on how businesses survive. So many times, companies forget that Human Resources should also be seen as a revenue driver.

All too often, human resources, or HR, is perceived as not much more than a necessary cost. It is the department that handles many essential company functions; however, they are unlikely to drive any real profit back into the business.

This isn’t necessarily the truth, but it doesn’t highlight a fundamental attitude towards the interconnected department. So, how can we possibly drive profits through human resources?

On its most basic level, human resources contribute significantly to the performance of the company. HR encourages your employees to do their best each and every day by offering a supportive role in their daily professional lives. Human resources are responsible for not only making the workplace a safe space that is conducive to productivity and driving profits but also helping employees make the connection between their professional and private lives. This department works diligently to ensure that things such as benefits, insurances, and vacations go smoothly and are actually beneficial to your employees. Happy employees make productive employees.

Beyond the obvious, HR has fantastic potential but rarely gathers any interest from management to further develop the department. Investing the time and energy required to elevate this functional department has the potential to impact your business positively. Here is how you can tap into the actual, profit-driving potential of HR.

Make Mental Health Awareness and Assistance A Priority

The mental health of your employees directly contributes to their productivity and how they relate to their work. Helping your employees maintain positive mental health should be a regular practice through consistent check-ins, early interventions, and employee surveys to gauge attitudes and feelings. Burnout is a significant issue for competitive and highly productive positions, especially during times of great stress (yes, 2020). Employees suffering from burnout are much more likely to leave, and we all know the inevitable cost of turnover.

Link Your Human Resources to Your Financial Model

The human resources department is also responsible for an entire host of responsibilities, including hiring plans, the cost of benefits, and helping maintain your employees' status. By aligning HR’s responsibilities with your financial processes such as cashflows, runway, and predictive analysis, you can save copious amounts of money.

These savings are mostly seen in the form of turnover or over-hiring and subsequent layoffs. Suppose you have not already made the functions of human resources an integral part of your financial model and analysis. In that case, you miss out on many opportunities to decrease loss and take advantage of unforeseen market opportunities.

Anonymous Employee Surveys

Understanding your employees' honest attitudes and feelings is crucial to your company's success and bottom line. Increasing productivity and employee engagement require that management has a clear idea of what they think of the current state of the company, as well as their feelings about future developments and endeavors.

Use human resources to anonymously find out everything they can about what your employees think about from everything to conflicts with management, opportunities for professional development, feedback about training, and even how the office décor makes them feel. A great way to do this is to offer surveys to employees to gauge where they are. This should be done at least twice a year.

Let Human Resources Take the Reins on Training

HR should be running your company’s training sessions. If there is not an HR department, then utilize a small team that consistently will handle this.

Let them host and manage learning and development training, employee-side projects, and lunch-and-learns to help foster innovative breakthroughs, team-building exercises, and professional development. Many advanced companies have employed these techniques and training strategies to usher in profitable ideas and creations. Constructing these safe think tank environments allows your employees to feel comfortable enough to share ideas and build off of each other.

 Human Resources Should Be Enabled to Create Mobility

Internal mobility programs include the creation and management of cross-functional roles and rotational initiatives. These programs create a great deal of value, especially in the form of stronger relationships and connections between departments. Internal mobility programs lead to a more responsive exchange of concepts and ideas, better engagement among employees and departments, and improved talent alignment within projects.

Let Human Resources Post Internal Positions and Projects

Not only is it more manageable and often cheaper to hire within your own company but maintaining transparency with your staff and employees helps foster a strong bond between management and other departments. Hiring outside is almost always more costly and riskier as you never honestly know what you are getting with an outside hire. When human resources are empowered to share new hiring and project developments with established employees, you can determine if any of those that you are already familiar with the company are interested in some form of movement.

What Happens if You Don’t Invest in Human Resources?

Ignoring the growth and profit-driving potential of your HR department can have many significant, negative impacts. The people working for your company are the driving force behind your revenue and growth, and a failure to listen to and represent your staff will result in less productivity, engagement, and progress.

In a world of sales, marketing campaigns, and research and development, human resources are usually nothing but an afterthought. However, not properly hiring for this department and investing in their influence on your company can have many adverse effects, including:

·         High Employee Turnover Costs

·         Low Productivity

·         Poor Employee Engagement

·         Employee absenteeism

·         Poor Internal Communication

Empowering your human resources department with a healthy investment and dedication to results will inevitably make your workplace healthier and more positive. When your HR team has created an environment that is conducive to productivity, engagement, communication, and transparency, then you can be sure that success will follow within all departments.