When HR and financial executives are in sync then operations run more smoothly and there is opportunity to advance the bottom line. CFOs are concerned with cost and HR handles a companies’ biggest budget item… its people, so doesn’t it make sense that these two work hand-in-hand? Let’s face it; we’re all in this together. But how do you foster this type of relationship? Where do you begin?
Here are five tips to consider for building a better relationship with the CFO:
1. Let business needs be your focus – Both the CFO and HR have deep roots in business functions. While one handles the budget the other handles the people; two vital roles in ensuring the future of the company. By starting with a clearly defined business plan, HR can evaluate appropriate strategies based on budget guidelines. HR will no longer be seen as the people person, but an equal business driver.
2. Know your strengths and their priorities – HR drives organizational performance, from recruiting top talent to fostering leadership skills. On the contrary, CFOs focus on revenue and lowering costs. They want to know that HR initiatives such as training are cost appropriate and advantageous. HR leaders should recognize how their strengths affect business in order to help CFOs see past the spreadsheets and focus on the value.
3. Remember there is no “I” in “Team” – According to a study by EY, there are four key factors driving HR and CFOs closer. Below are the four key factors.
- Locating good talent is harder than ever and labor costs continue to increase.
- The importance of HR is rising in corporate hierarchy.
- Companies are constantly developing new products and services to adapt to the rapidly changing business environment.
- In an effort to achieve greater success, more organizations are transforming their business models.
Working as a team rather than as separate entities will only help to eliminate inefficiencies making it possible to achieve greater success.
4. Speak the language
While no one expects you to know the tradeoffs between “headcount allocated dollars” and “spend” it is important none-the-less to align your thinking with that of the CFO. Nelson Mandela said it best, “If you talk to a man in a language he understands, that goes to his head. If you talk to him in his language, that goes to his heart.” If you can establish a commonly understood set of terms with your CFO then you are on your way to a sound relationship.
5. Keep open and honest communication
Don’t expect an immediate bond to happen. Like most relationships, it takes time. To move towards developing a stronger partnership, open and honest communication is necessary. Consider holding weekly meetings or informal discussions. After all, a strong partnership between HR and the CFO can be a significant advantage.
Neglecting a relationship with the financial head is a poor decision, don’t make this fundamental mistake. The demands of today’s business mean stepping out of your shell and working more closely with other business functions. Familiarize yourself with other aspects of the business, not only to better yourself but to improve organizational performance. Companies in which HR and the CFO share a strong relationship are linked to superior business performance.
How connected are you to your CFO? Maybe it’s time to start the conversation.