The relationship between a Chief Financial Officer (CFO) and a Human Resources Director (HRD) can be sometimes be a tenuous one. This is often due to a misunderstanding of each other’s roles or a misalignment in priorities. The key to successful business partnering is to find common ground, play to each other’s strengths and present a united front to the CEO and the Board.
We spoke to a number of CFOs and HRDs at our recent event “Connecting numbers with culture” to get their thoughts on how they believe HR and Finance can work together more effectively.
Working together with HR
- Focus on the “golden triangle” – this means regular meetings and open and honest communication between the Chief Executive Officer (CEO), Chief Financial Officer (CFO) and Human Resources Director (HRD), to ensure you are all on the same page and working towards the same goal.
- Understand each other’s strengths – Don’t make the assumption that Human Resources isn’t commercially-focused, or the Chief Financial Officer is not people-focused. Each function has its own strengths and brings equal value to achieving business strategy.
- People should be everyone’s business – culture and people must be a shared agenda between CEO, CFO and HRD.
- Align strategy with data – ensure that you are linking your business strategies to the data as much as possible and implementing systems and processes to effectively track and read the data that will allow you to make improvements. Acknowledge not all data will be ‘hard data.’
- Plan early and communicate often – start the process of discussing HR-related projects with Finance in the planning stage before you get to the budget meeting. The Human Resources team also needs to understand and talk numbers. Both CFO and HRD need to be aligned before presenting business cases to the CEO.
- Open and transparent reporting – the need to report on culture in ASX businesses will drive greater accountability and collaboration between Chief Financial Officers and Human Resources. Investors want to see that the company has the right culture and incentive structure to drive the right outcomes.
At the end of the day, people and culture should be a shared agenda.
For more on this topic, check out the video highlights from our recent panel event on how CFOs, CEOs and HRDs can work together to be more effective and drive business growth.