London, 8th May: New research from OrgVue by Concentra Analytics shows that finance and HR professionals are struggling to collaborate effectively. While 55% of HR leaders believe their rapport with finance is productive, just 25% of finance professionals feel their relationship with HR is collaborative, shining a light on each department’s different perspectives.
According to the research – carried out with over 400 finance and HR decision makers in the UK and US – this interdepartmental tension is having a negative impact on organisational effectiveness when it comes to workforce planning and analysis.
People are the largest financial line item for the majority of businesses. And yet the results showed that only 48% of HR and Finance functions can say with confidence that they’re able to determine if the right employees are doing the right work to deliver business strategy. And only 38% have a complete view of how fast they could quickly re-organise, suggesting a lack of agility.
The results also revealed confusion over which function is actually responsible for overseeing workforce costs, with just over half (55%) of HR respondents suggesting they should be overseeing it, but finance overwhelmingly believing it to be squarely in their sweet spot (88%). There is also a battle brewing over who owns the strategic side of workforce planning; finance say they should own it (55%), but HR is adamant it should be their responsibility (76%).
EY research* shows that there’s “a powerful link between a business’ performance and the extent to which its HR and finance leaders collaborate.” And the good news is that this latest research found progress towards great collaboration in some areas. For example, half of respondents felt able to share information across departments effectively (53%), 72% agreed that it’s HR’s responsibility to get the right people with the right skills working on the right tasks and 68% agreed that HR that should determine future workforce needs.
However, this progress could be constrained by a lack of confidence amongst HR professionals. With 62% admitting that acquiring the right skills is the single biggest barrier to better people analytics and the most difficult to overcome.
Rupert Morrison, CEO, OrgVue by Concentra Analytics, commented: “Traditionally, HR and finance have been comfortable sitting in their silos, but organisations can no longer separate the people from the pounds.”
“In a dynamically changing economy organisations need to proactively and strategically manage their people data if they’re to succeed. Of course, it’s not a simple case of asking finance and HR to play nice, instead, it’s a wholesale change in the way the two functions communicate, collaborate and plan.”
“If an engaged, agile and productive workforce is the goal, then Organisational Planning & Analysis (OP&A) is the playbook. OP&A is a natural partner for established FP&A functions. It creates a common language and clear data points enabling finance and HR can have a meaningful, fact-based, dialogue about how they can meet collective objectives. But someone needs to take the first step.“ Morrison concluded.
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Concentra Analytics builds SaaS data products that enable businesses to capture, manage, and analyze data to improve their operations. Its flagship product, OrgVue, is the leading SaaS workforce analysis and modelling solution used by business, finance, and HR leaders to plan and optimize organizations on an ongoing basis. Alongside OrgVue, Concentra’s other products include SupplyVue for holistic supply chain optimization and DataPlus for data warehouse automation.
Concentra Analytics is headquartered in London and works with over 100 enterprise clients from offices in Philadelphia, The Hague, and Hong Kong.