This is especially the case if other stakeholders – such as a chief financial officer (CFO) – need to be convinced as to the worth of any such investments.
The finance/HR relationship is important for three key reasons:
• CFOs often have the final approval of HR projects
• The CFO is often a trusted advisor to the CEO
• In some organisations, the CFO is directly responsible for HR and related areas like payroll
Meeting in the middle
HR’s uptake and understanding of metrics, analytics and data has escalated, while finance professionals are more aware than ever about the importance of talent to business success. Of all executive roles, CHROs have the most impact on employee engagement and productivity – both of which significantly impact financial results. It’s fair to say there’s been a thawing in relations, but there’s still work to be done.
According to research by Ernst & Young, private company CFOs have stronger relationships with IT and operations teams than they do with HR colleagues. Over half (55%) of CFOs reported they had limited or no collaboration with CHROs.
CFOs oversee and track the costs of the business and ensure that decisions made have a positive ROI. That means understanding the financial costs and benefits of every initiative a company undertakes, and the how those decisions impact the bottom line. It’s in HR’s best interest to ensure they take a data-driven approach to technology investments and communicate those insights to the CFO.
Keen to know more? Download our eBook on the critical relationship between HR and finance leaders.
Why data is the key
CFOs and finance teams thrive on data. So, one huge selling point of WFM and HR software is the goldmine of both qualitative and quantitative data they contain. Analytics can help CFOs to:
- Determine the effectiveness of various business components such as recruitment, retention, learning & development, workforce management (including rostering and scheduling)
- Bring strategic insight to talent acquisition and deployment to lower the cost of hiring and increase workforce productivity and performance; this data is especially crucial in those organisations reliant on roster-based, shift-driven (or “deskless”) workers where agency costs can be prohibitive
- Identify patterns in different business units or locations so that cost efficiency and productivity is not negatively impacted
- Forecast ahead to predict organisational budgeting and identify cost irregularities and ‘blind spots’. For example, unexpected or unscheduled overtime. Scenario planning is also possible with advanced workforce data skills
- Identify risks. For example, employee flight risks. Staff turnover is costly, so identifying employees who are considering leaving the organisation and taking steps to retain them can reap significant dividends
- Consolidate resources and personnel across HR and finance functions
- Understand and support investment into HR initiatives and tools, including technology
How data can help ‘connect the dots’
Traditional HR metrics centre around staff attraction, retention, training completion rates and engagement – but these don’t necessarily translate into financial implications with a direct business impact. This makes it difficult to “connect the dots”. For example, both the CFO and CHRO might know how much training costs, but they may struggle to see where and when expenditure is delivering an uptick in business performance.
Linking qualitative benefits to business objectives is one way to navigate this. In the example above, it’s easier to pitch a new eLearning platform when there’s a need for training to launch a new product, or when workplace safety training is needed to meet new compliance requirements.
In 2023, the key is for HR and finance to have access to real-time, integrated data ecosystems that can draw data in from multiple systems across the business.
When it comes to WFM technology, ultimately that goldmine of data can be leveraged to develop more accurate labour forecasting that can inform staffing needs to ensure optimal use of human resources and prevent under- or over-staffing. The former is essential for compliance (and the prevention of hefty fines and brand damage), and the latter simply makes good financial sense as only the people required are being rostered and paid.
In addition, with the right WFM tools, like those offered by Humanforce, unnecessary overtime can be avoided with smart rostering based on historical data, event data, as well as occupancy, foot traffic or PoS data.
From attendance summaries to pay comparison reports and countless other workforce management reports, Humanforce Workforce Analytics enables users to make more informed, data-driven decisions. Users can utilise pre-made dashboards or create custom dashboards to highlight what’s most important to their organisation, understand where planned and unplanned costs are occurring, and identify opportunities for improvement.
Getting technology investments over the line
Of course, convincing a CFO to invest in workforce management or HR technology by promising access to rich, data-driven insights may not be enough. Here are three additional ways to convince your CFO that WFM technology is a smart investment.
- Be very clear on the quantitative benefits
Further to the previously mentioned point about bottom line results, establish what the quantitative benefits of investment into a piece of technology will be.
A new integrated payroll and WFM system, for example, may help reduce unreported payroll “leakage” such as unintended spend on labour, or reduce wage theft through more accurate time tracking. Smart, AI-driven tools can uncover attendance and work patterns that indicate non-compliance, before these issues blow up into larger issues. Anything that can reduce the chance of paying costly fines – not to mention the brand damage that can stem from non-compliance – should be pursued.
- Be upfront and thorough
When creating a business plan, there’s no point in skipping over or omitting the direct or indirect costs associated with a tech upgrade – and the same applies to assessing one-time and ongoing costs. For example, account for implementation and configuration costs, support needed from IT and other business departments to make implementation successful, and training expenses.
For further tips on building a business case for WFM software investments, download our whitepaper.
- Look beyond cost savings
While cost savings are always welcome, also factor in how new tech can unlock value in other, less defined ways. Will the tech enable workers to conduct their work faster or more efficiently? For example, giving deskless workers access to mobile onboarding removes paperwork and reduces time to productivity. Similarly, empowering shift workers to bid on their preferred shifts may reduce reliance on agency staff and ensure roster gaps are quickly filled but will also positively impact culture and the wellbeing of workers.
Demonstrating ROI may not always be easy, but it is possible. It’s apparent the reasons to invest in HR tech are a mix of the tangible and the intangible. See the graph below, based on a global survey of deskless employers by Emergence.
Top reasons for investing in deskless technology
How Humanforce can help
The current climate has heightened the need for business leaders to make strategic investments in their quest to attract and retain talent. Technology will continue to play an important role in enhancing employer brands and building a compelling employee experience. Humanforce is committed to providing solutions that will help employers to attract, engage and retain deskless workers.
We are a leading provider of shift-based workforce management solutions that simplify onboarding, scheduling, time and attendance, payroll, employee engagement, and communication. Customers in more than 23 countries use Humanforce to optimise costs, realise compliance confidence, empower their team, and drive growth. Humanforce was founded in Sydney in 2002, and today has offices across Australia, New Zealand, Singapore, and the UK.