How Your HR Department Can Make Your Company Money

I got an email from Anne, a small business owner. She was facing a lawsuit due to unfair dismissal. It then dawned on her that she didn’t have clear structures in place which resulted in to disconnect between employees and management and poor employee relations which caused a lot of conflicts. As a result, there was low morale, low productivity, a lot of absenteeism and turnover which affected the business success.

‘’I have spent a lot of money, time and energy hiring and replacing employees and time firefighting instead of focusing on my business. I am the one keeping an eye over staff and most departments’ affairs and I spread myself too thin. My business has not been doing very well either and I am considering closing it’’

HR acts as a bridge between management and employees and supports the organization deal with issues before they become problems by being proactive.

Besides the issues Anne was facing, HR also addresses retention by seeing to employee engagement, performance management to ensure productivity, putting up and implementing HR policies and procedures that help govern employee work and behavior and protecting your company from legal actions just to mention a few.

HR sees to employee productivity which leads to profitability. This also helps you avoid problems that could cost your business time, money and resources.

I advised Anne that since her business was small and she could not afford to have a department in place, to consider our HR consultancy services  to save cost and ensure things function while she could focus on the business.

I also gave her tips on how HR could make her money;

1. Getting the Right Talent and Putting Them in the Right Place

Recruiting is one of the reasons companies lose time, money and resources due to inefficiency.

In Anne’s case, she kept getting the wrong placements which brought about conflict leading to low morale and productivity at work and as a result people started missing work and leaving. She also lost clients due to their bad attitudes.

Yet, Anne had spent a lot of time and money advertising, recruiting and training the employees. If she had HR, they could have helped identify and fill in these gaps by doing strategic recruitment and selection for the most qualified candidates with the skills, saving the company on the training costs and time, and money.

Consider making it easier for your HR team to recruit by trying out our affordable end–to–end services by contacting us.

2. Have a Data-Driven Strategy (HR Analytics)

HR departments help organizations make informed decisions by recommending how costs can be controlled and reduced.

HR tracks metrics around HR functions then uses this to help you determine the strategic direction of the company. They help project people’s needs based on history such as the average time it takes to hire, the time it will take to train and the cost of the hire.

HR departments can use surveys to get information from staff and do industry research through the internet to get this data. Some also use software tools and technology developments.

With data, leaders can make informed decisions that affect the all-around revenue of the organization.

3. Ensuring Employee Engagement

For business success, employees have to be successful in their work.

However, HR is always looking for the best strategies that will enable staff to fit in the organisation’s culture. It helps establish and maintain a good workplace environment among the staff.

This is by ensuring they identify gaps and constantly upskill employees to improve productivity and engagement. One can easily know if this function works by tracking the progress of what changes before and after training.

Upskilling employees improve their productivity thus making you money.

4. Building A Company’s Culture 

HR helps build the culture of the company by seeing to employee engagement, morale and retention.

HR ensures this by promoting the following;

a. Team Building

All employees come together to streamline relationships by working together to achieve a common goal. When workplace relationships are healthy, it motivates employees to work harder.

b. Introducing Reward and Recognition Programs;

This can be verbal or even having programs such as employee of the month. An appreciated employee is motivated to make your company money.

c. HR Policies and Procedures

They not only guide employees’ work and behavior but also help you protect yourself from legal actions by ensuring you are compliant to the employment law.

The above ensures that employees are engaged and continuously productive.

Conclusion

A company without an HR department is missing many opportunities and placing the business at risk and costing the company a lot of money.

If your company cannot afford an HR department or would like to save costs, consider working with a professional HR consultant by contacting us for this service.