Your organization, like most of your leadership, must have spent a lot of time in Q4 developing its budget for the upcoming year. And if you’re working in the field of HR, you might think you don’t have much power to manage the organizational budget or control whether your company stays within budget. But that’s where you’re wrong!
In this blog post, you’ll know just how you can play a role in helping to manage the organizational budget and beat its budget issues this year. By the end, you’ll have a whole toolkit of ideas to influence spending at your workplace giving you the power to support the company’s bottom line and advance your career at the same time.
We’ll discuss the following;
Why Should HR Work on the Organization’s Budget?
What Parts of the Budget HR can Audit?
What to do with the money you help save?
Let’s Get Started
Why Should HR Work On The Organization’s Budget?
Larger organizations have in-house bookkeepers or even finance teams whose job is to handle the whole company’s budget.
But in small to mid-size businesses, many HR professionals are already doing some amount of bookkeeping. And even if you’re not, you likely have access to more budget information than the average employee.
That means you’re in a great position to manage the organizational budget by offering insight into where your organization can save, or even make some money.
Of course, the most direct connection between HR and the budget is payroll. Professional payroll management is both a huge part of your job and, most likely, your organization’s biggest expense.
With many companies facing difficult decisions about staffing and some already dealing with layoffs, creating some breathing room in the budget is a powerful way to manage the organizational budget and ease the burden of payroll in a tough economy.
Plus, when you’re thinking about your own career, it never hurts to add value to your organization. Your boss is sure to notice if you take something off their plate. And with budgets being a high priority, there’s no better way to support your organization than by helping them out financially.
What Parts of the Budget Can HR Audit?
But how much power do you actually have? Most HR professionals have enough experience and insight to help manage the organizational budget in three key areas, viz., monthly recurring expenses, supplies and equipment, and recruitment costs.
Let’s Look At Each One.
Monthly expenses can be anything from regular transportation costs to your office’s power bill. But when it comes to manage the organizational budget, the most common one that you can probably influence is your organization’s software subscriptions. Take a look at the software your organization uses, and make sure you’re not paying for tools that are no longer helpful.
For example, if a particular company was using GoToMeeting for all their sales calls, which means every person on the sales team had a GoToMeeting account that billed every month. But now, most of those calls are handled through Zoom or Google Meet.
If they didn’t think to cancel GoToMeeting, they would be looking at a whole extra expense that wasn’t bringing in any value to their teams.
Monthly expenses also include any services that you use in-house that are charged per user per month. Check to make sure you don’t have more logins than you need on tools like your HRIS or other software.
If you use an all-in-one system, all you have to do is click “terminate” or a similar option on an employee who has left the organization and you instantly stop paying out for them.
But in some HRIS software, there’s an offboarding feature that automatically removes them from any feature of the software that is applied to them.
There are no contracts that’ll lock you in a certain number of users for the year regardless of your team size. You only pay for the employees you actually have.
Supplies and Equipment
Another area in which you can help to manage the organizational budget is the cost of supplies and equipment.
In your role as office manager, you may be responsible for buying regular office supplies, which means you’re intimately familiar with how much they cost and how much they get used. Brainstorm ways to cut expenses by slowing down on ordering supplies that don’t get used often. And look for opportunities to get better deals on popular supplies by buying in bulk.
Don’t forget technology when considering supplies. For example, no matter how high quality your computers are, eventually they’ll be old enough that they can’t be updated to new operating systems as they’re released. Instead of tossing them, look for third-party vendors with buyback programs.
For example, you can sell your outdated devices to buyback companies so they can be recycled and not go to waste. And if you use apple products, diamond assets are another great option to get something back for your old technology.
If you’re not sure which buyback vendor to approach, check with the vendor you get your tech equipment from. There’s a good chance they already have a relationship with a buyback company and can point you in the right direction.
Finally, to manage the organizational budget, HR Professionals have the potential to bring in huge savings by auditing their organization’s recruitment costs. Here’s how.
RPO, or recruitment process outsourcing, is a common strategy organizations use to help them fill job vacancies with strong candidates faster. RPO can be a great tool, if you have the resources, for hiring highly specialized or niche roles. The problem is, it’s expensive.
Depending on the size of an organization, that means RPO could cost you as much as an employee’s salary every year.
This level of savings goes beyond the pennies you can pinch in other areas to truly make an impact on your efforts to manage the organizational budget.
What Can Your Organization Do With The Money You Save?
In this uncertain economy, the best you can do to manage the organizational budget is careful and intentional budgeting, which will help you avoid having to conduct layoffs.
But even if your savings aren’t quite on that scale, you can still add value by suggesting how to allocate saved funds.
After one of your budget strategies goes into effect, write a proposal for your employer showing how much money it will save and where, from your point of view, the additional budget space can best serve your organization.
This could be as elaborate as implementing a new HRIS system, or as simple as replacing uncomfortable chairs or annoying copy machines.
You’re probably the one who gets complaints when something isn’t working in the office, so you know what small changes could have the biggest impact on your team.
While you’re at it, presenting data on how much money you saved your organization is a great time to talk to your employer about your own professional development. If you’ve taken on extra responsibilities, like recruitment and selection, you should be compensated for them, so don’t be scared to ask for a raise to match your new job scope.
Or, consider ways your employer can support your career, like sending you to a top HR conference.
In this blog post, we’ve covered everything you need to know about the ways to manage the organizational budget and help your organization beat its budget issues from saving a few cents on supplies to eliminating whole categories from the budget by taking over recruitment.
Your role touches every part of your organization and you have more influence than you think. Taking some time now to support your company’s bottom line will pay off in the long run both for the organization and for your career.
As always, keep in mind that your role is as strategic as you make it.