As an HR professional, you know your role has changed a lot. You're no longer just handling routine tasks - you're now a key player in making strategic business decisions. To show the value HR brings, it's important to know what your CFO wants to see. Here are five key results your CFO likely expects and how you can deliver them, with some helpful theories to guide your strategies.
1. What the CFO wants: increased productivity and efficiency in HR processes
The theory: Frederick Taylor's principles of scientific management suggest that making workflows more standard and optimised can really boost efficiency. Taylor believed that cutting down on variability and human error makes operations smoother and more reliable.
How HR delivers: Using Human Capital Management (HCM) systems to automate things like performance management and salary reviews can really boost productivity. Automated workflows save time and make sure everything runs smoothly and accurately.
Regular, systematic feedback and evaluations keep employees engaged and aligned with company goals. In salary reviews, automation ensures fairness and objectivity, which builds trust and satisfaction among employees. This not only streamlines operations but also frees up HR to focus on strategic initiatives, directly boosting productivity.
2. What the CFO wants: HR strategies that support and drive broader business objectives
The theory: Michael Porter’s theory of competitive advantage says that to stay ahead in the long run, a company needs to match its internal strengths with external opportunities. This way, the company’s capabilities support its overall strategy and direction.
How HR delivers: Aligning HR strategies with business goals is crucial. For instance, if the company is expanding into new markets, HR should focus on hiring and developing talent with knowledge of those specific regions. If customer service excellence is a top priority, HR needs to attract and retain individuals who excel in customer relations and create a culture that prioritises outstanding service.
When employees feel valued and engaged, they’re more productive and positively impact business outcomes. By aligning talent management with business objectives, HR can directly contribute to the company’s success and profitability.
3. What the CFO wants: reduced operational expenses in HR functions
The theory: Barney's Resource-Based View (RBV) of the firm suggests that using internal resources, like technology, can give a company cost advantages. By effectively using these resources, companies can streamline operations and cut costs.
How HR delivers: Digitizing HR processes with HCM systems is a great way to cut costs. Automation makes everything run smoother by reducing the need for manpower and cutting down on errors. This efficiency speeds things up, keeps everything consistent, and helps avoid expensive compliance issues.
Going digital also means less physical paperwork, which saves on printing and storage costs. For example, digital onboarding lets new hires fill out forms and access policies online, making their integration faster and reducing admin costs. These cost-saving measures can really boost the company’s bottom line.
4. What the CFO wants: accurate forecasting and better financial planning
The theory: Decision theory, especially with predictive models, backs up the idea that better data helps you make better decisions. Predictive analytics let companies forecast future events and make proactive adjustments.
How HR delivers: Using predictive analytics is a game changer for HR cost management. By analysing historical data, HR can forecast future costs and staffing needs more accurately. This proactive approach improves financial planning and resource allocation, cutting down on unnecessary spending.
Predictive analytics helps manage budgets better, anticipate high turnover periods, and assess the financial impact of different benefits options. This data-driven decision-making ensures HR initiatives align with business goals, maximising ROI on human capital and boosting the company’s competitive edge.
5. What the CFO wants: a stable, engaged, and productive workforce
The theory: Herzberg’s two-factor theory says that what makes employees happy and motivated comes down to two things: hygiene factors (like salary) and motivators (like recognition and personal growth). To keep employees engaged and reduce turnover, you need to pay attention to both.
How HR delivers: Implementing automated performance management systems allows for continuous feedback and development, which boosts employee satisfaction and productivity. With data from these systems, HR can spot and tackle potential retention issues early on.
Offering competitive compensation packages, career development opportunities, and work-life balance initiatives can help lower turnover rates, saving on the costs of recruiting and training new employees. Improving employee engagement and retention not only makes for a better employee experience but also helps ensure financial stability for the company.
Conclusion
To meet your CFO's expectations, focus on a few key areas: boosting productivity with automation, aligning HR strategies with business goals, cutting costs through digitization, improving financial planning with predictive analytics, and increasing employee engagement and retention.
By emphasising these points and incorporating some key theories, you can show how HR supports and drives business success. Embrace these methods to turn your HR department from a support role into a key driver of business value, helping your organisation grow effectively and sustainably.
