Internal Financials Often Overlooked
For the most part, the tax season is over. However, now is the time for business leaders to take a look at another aspect of the organization’s financial health. Do you know the impact your human capital is having on your business? Your employees’ financial impact is more than salary and benefits. It is important for business leaders and HR leaders in the organization to know the debits, credits, profit and loss, and the financial report card of the human side of the business.
Givers Vs Takers (Credits Vs Debits)
Do you really know who the “Givers” are in your organization? Accountants are concern with the debits and credits of daily transactions. Managers and HR representatives in the organization should be just as concern with those who “Give” and “Take” in the organization daily. These individuals are just as impactful to the financial success of the company. No organization is operating at its best with excessive debt or those taking away from the productivity, contributing to missed goals, creating a negative culture, and getting paid to give less than 100%.
Some managers need help in recognizing these individuals while others need to address them and take action. Just like a financial statement can show when you are in the red, your employees are demonstrating their impact on your team the same way. In fact, many organizations are letting these behaviors go unchecked because the manager does not have the time to deal with them or think getting something out of them is better than having to start over. In either case, managers must realize they cannot afford to operate in this manner. We have helped our clients’ with these challenges by helping the managers implement monthly check-ins, effective performance review processes, and progressive developmental plans.
Dashboards and Scorecards (Financial Statements)
The information and details are in the numbers. Sounds like accountant talk. The same is true when reviewing human capital. There are two tools that can help your organization become more strategic and monitor progress. The HR dashboard is a snapshot of specific metrics important to an organization. For example, the dashboard could provide workforce metrics around employee turnover, hiring, cost per employee, cost of rewards, employee development numbers, HR compliance ratings, etc. This information could be provided at your fingertips. The scorecard is like a report card; a snapshot at a particular time period.
Both tools are ways to review how you align with the business goals and review the results of the organization’s operation. We recommend you start simple and measure what is most important first. Some of this information is already available in the organization. Having it all in one location and centrally monitored minimizes mistakes. There are several pre-built software solutions that be implemented to expedite the access to valuable metrics that can help drive the success of the organization. How do you know where adjustments or changes need to occur when you don’t have all the information? An organization that wants to become more strategic, align all goals to the business goals, and have an HR department that can provide indicators to make better decisions, then these two tools should be actively used in your organization.
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