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4 Critical Considerations for Your 2017 Budget

Sarah Wallach
Oct 05, 2016

workforce planning

Upcoming event: Budgeting for Your 2017 Workforce – 10/6/16 @ 12:00 PM CST

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As the role of Human Resources continues to become increasingly strategic and analytical, HR practitioners will need to increase their connection to their colleagues in Finance. In several instances, including preparing your annual budget and planning headcount, making it a priority to form a true partnership between people in these two departments will drive a stronger, more financially responsible outcome.

Today, such collaboration between HR and finance departments takes on many new forms: the growing number of HR chiefs reporting directly to the CFO rather than the CEO, shared analytics platforms, and even the position of Chief Resources Officer, which combines Human Resources and Finance functions.

Overall, company leaders are looking to both departments to play a bigger role in managing growth. And, when it comes time to prepare your annual budget, you’ll have a much easier time developing a plan that will make the most of your available resources if these two groups are accustomed to sharing ideas.

Once you’ve created this partnership, here are four tips for your consideration that will help everyone with the budgeting process:

1. Realize that budgeting to an exact dollar amount might not be possible.

Because of the finite nature of numbers, we tend to think of them as anything but subjective. Instead, your numbers should take into account what you’ve spent in the past, the results of that spending, and your goals for the future. By presenting both numerical and narrative support for your budget, you’ll paint a more complete picture than could ever be achieved through mathematics alone.

2. Find a tool that allows you to model different scenarios.

A modeling platform serves as a support tool for the intersection of HR and finance initiatives, and allows both teams to contribute their information or ideas in an organized and visual manner. With this type of tool, you can allow multiple viewpoints to visualize all of the options that the team is contributing, and potentially open their eyes to solutions they had not thought of before. In the end, modeling also creates solid justification for decisions.

3. Start WAY earlier than you think you need to.

It’s important to keep in mind that this process can take a while, especially considering everything else your team members may have on their plates at the time. Budgeting processes at many companies have the reputation of constantly being delayed each and every year, and, at a certain point, it’s just not acceptable to repeat that same mistake again and again.

4. Make your headcount plan and employee investment a priority.

Your company’s most valuable resource is its employees. And, as the economy continues to recover, about 66 percent of employers are finding it difficult to find people with the right, new skills1. Consequently, budgeting for the recruitment of new employees as well as the development of high-potential current employees should be considered an “investment” in your future bottom line just as much as the resources you allocate to product development, marketing, etc.

Are you ready to budget for your 2017 workforce? Find out by joining our webinar on Thursday, 10/06. Register here.

Workforce planning can be a very broad, slightly overwhelming topic. With that in mind, we’ve narrowed it down to four key activities that will help you create a strong foundation for all of your workforce planning tasks.

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