Human Resources: Positive Impact on Your Bottom Line or Just Another Overhead?

Updated: October 12, 2010

Here's a brief overview of some thinking on how HR can impact your bottom line:

Partner - working alongside you as any other senior director giving valuable input into how the business can improve. Where a solid HR Director is in place, often they are able to look at the bigger picture. They understand strategy and can provide a vital perspective to senior management.

Coach - the person who's role it is to support you to be able to deliver the results, sometimes offering wise counsel, your sounding board for new initiatives, a confidential source when the company is going through change, your formal coach supporting you to develop or meet a challenging goal, someone with an independent view that you should feel you can confide in.

Revenue generator - most HR teams are responsible in some way for recruitment, talent management and T&D. Well developed and motivated staff can deliver the best results to your profits. Effective talent management and excellent management and leadership skill has a major impact on the results.

Marketer - the HR team is often the first point of contact for a prospective employee and therefore part of the employer brand. The way the company interacts with candidates through media and consultants, the actual recruitment process, onboarding or orientation is vital. If potential staff like what they see and hear you can be sure they will tell others. If they don't - you can be sure of the same. Today's social media ensures bad news travels fast and reputations can be affected. Good news will also travel fast and even if someone doesn't get a job or interview, the way they are handled does matter. Inside the company HR can be communicators whether through company intranet, newsletters or through their own internal networks.

Risk manager - when you get in a spot of bother with staff your HR team will often advise on the potential risk and support the management in managing it, or manage your outsource legal advisors. If you are in a period of change, M&A, due diligence or crisis you should be able to depend on your HR team to help you manage associated risk - costs, legal liabilities, change, and communications. Effective risk management has a significant impact on the bottom line.

Cost manager - the right organization design, understanding and analyzing people costs, ensuring best value benefits, managing recruitment costs and HR's own costs all deliver savings directly to the bottom line.

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