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What is the monetary impact of HR interventions on a firm's bottomline?


Topic Expert
Malak Kazan
Title: VP, Special Projects
Company: ERI Economic Research Institute
(VP, Special Projects, ERI Economic Research Institute) |

depending on the intervention it could be employee productivity measure (specific to position, business, department), employee turnover/retentions, customer service/satisfaction/retention, etc.

Topic Expert
Shannon Mathews
Title: Controller
Company: Aldrich Services LLP
(Controller, Aldrich Services LLP) |

A good HR department can save you TONS of money if they help you properly handle sticky employee situations. Too many managers "think" they know how to handle sitautions, but a good HR department will be able to give the advise needed to cover an employer on various legal issues.

As mentioned above they also can do so much in employee moral and productivity... but only if you take the advise that they provide.

Topic Expert
Wayne Spivak
Title: President & CFO
LinkedIn Profile
(President & CFO, |

In NYS, the most employer friendly state in the union (sarcasm here), a good HR department can save you large amounts of money due to new laws and regulations being enacted to safeguard employees from the big bad employer (but in reality most often its for the benefit of the state coffers).

An example is the Wage Theft Protection Act. Fill out the form wrong, and on audit it leads to more audits (exempt vs non-exempt and failure to pay proper wages).

Topic Expert
Regis Quirin
Title: Director of Finance
Company: Gibney Anthony & Flaherty LLP
LinkedIn Profile
(Director of Finance, Gibney Anthony & Flaherty LLP) |

A proper Human Resources function is the cost of doing business. State and federal legislation that your specific business must abide by, is an uncontrolled expense. You can gain comfort in knowing that all of your competitors are under the same requirements and the corresponding monetary impact.

What you do control and should monitor -

1) Attrition - The non-value added expense of "attrition." Depending on your business, on-boarding a new employee can be expensive - processing, background check, training, equipment. Businesses with a high turnover just bleed cash.

2) Compliance - There is no risk/reward trade-off. The penalties for not abiding by state and federal guidelines are too high. This area requires legal guidance, as answers are not always clear, i.e. staffing categorized as W-2 or 1099.

3) HR Staffing levels - your HR department should be viewed like other departments, i.e. is your HR department staffed too high or too low. More people in the group does not mean more safety for your company.

In conclusion, focus on the controllable issues to mitigate the "monetary impact" vs. uncontrollable "cost of doing business."

Don Schlosser
Title: Chief Financial Officer
Company: Varolii Corporation
LinkedIn Profile
(Chief Financial Officer, Varolii Corporation) |

I think the question itself is subtly misstated in it's focus on HR "interventions". As a CFO I'm often amazed at the way we as CFOs tend to overlook the UPSIDE bottom line potential of having an HR department lead and facilitate the ongoing processes, steps, and (don't forget :) ) compensation "hooks" that help you crate and sustain an engaged employee team. The evidence is overwhelming that such a team will have a huge positive impact on your botttom line, and that absent such a team you are bailing a leaky boat. The HR department can't do this all by themselves, of course. It takes wide executive leadership. But by helping to structure the process of identifying the types of skills and characteristics most needed in the company, helping to find those people, motivate them, giving them the tools to motivate THEIR team members, train them...That IS your bottom line. This can conceivably be done WITHOUT a strong HR team, but it is hard to see examples of companies that have done so.


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