How HR can drive financial success

Nothing is accomplished in an organisation without its people. And the hub of all things people-related is the HR department, which drives activities – such as hiring, onboarding, leadership development and career improvement – that all have a big effect on the success of an organisation.

But while HR plays a huge role in shaping success, it often flies under the radar when it comes to financial impact. People power doesn’t exactly scream “measurable metric,” does it?

Well, it’s time to change that narrative. With the rise of people analytics and stronger ties between HR and finance, businesses are starting to see the numbers that prove investing in their workforce is not just the right thing to do – it’s also the smart thing to do.

So, how do you connect the dots between HR strategies and bottom-line results? Let’s break it down.

Measuring people power

First off, ditch the idea that human capital can’t be measured. Sure, not everything about people is quantifiable (thankfully!), but today’s technology offers incredible tools to uncover value in your workforce.

The trick? Be future-focused. Don’t just rely on traditional metrics like engagement surveys. Instead, tap into data that helps you predict outcomes and demonstrate the financial value of HR initiatives.

For example, want to roll out a new learning programme? Use metrics to forecast how it’ll reduce turnover or boost productivity. Eyeing a recruitment drive? Show how hiring for key roles will directly impact revenue growth.

The key is to focus on the data that speaks to your biggest business challenges and aligns with your goals. Then, use it to tell a compelling story.

The dream team

For HR to really shine, it needs a solid partnership with finance. Think of it as a dynamic duo – HR brings the people data, finance connects it to the numbers, and together they uncover insights that drive profitability.

Here’s how to make it happen:

• Share the data love. Let finance have a peek into HR systems and vice versa.
• Bring in an expert. An HR-focused finance analyst can bridge the gap and turn raw data into actionable insights.

Once you’ve got the numbers, don’t sit on them. HR needs to take the lead, presenting findings to leadership and showing exactly how initiatives (like flexible working or upskilling) are paving the way for financial success.

From insights to impact

When businesses harness the power of people analytics, magic happens. Imagine being able to:

• Spot employees at risk of leaving and take steps to keep them happy.
• Identify roles with the highest value and prioritise investments there.
• See how productivity soars after introducing remote working or training programmes.

It’s not just theory – it’s practical, game-changing action. And when businesses tap into this data, they unlock opportunities to grow while avoiding costly missteps.

Why it’s time to act

The reality? Many organisations still aren’t making the most of measuring human capital. But those who do are seeing huge payoffs.

To get started:

• Set clear goals. Know what you want to achieve and tie your HR metrics to those targets.
• Invest in tech. The right tools can make all the difference in analysing and tracking workforce data.
• Work with finance. Collaboration is key to connecting people data to profitability.

When HR and finance join forces, the results are undeniable – boosted profits, happier employees, and a workplace that thrives.

Wrapping up

HR isn’t just the people department; it’s the powerhouse behind organisational success. By using people analytics and building bridges with finance, HR teams can prove their worth whilst improving their organisation’s financial health and cement their role as strategic leaders.

So, are you ready to turn people power into profit?