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5 Steps to Evaluating Your HR Function

hr best practices hr compliance hr department hr essentials hr for small business hr management Oct 19, 2021

The field of Human Resources is evolving and being embraced in even the smallest of organizations today. With the onslaught of legal issues facing the employment relationship, all enterprises need to be sure they have an understanding of human resources. Rulings and litigation on minimum wage, paid time off, gender identity and more are only the beginning of the changes we see on the landscape of employee management.

Business executives must understand what their entity needs, what compliance is necessary, and how that can be best embraced within their operation. Consider these steps to evaluate your HR function and move forward with a human resource function that supports the overall operation.

Step One: Evaluate what HR looks like today in your organization? HR started as an administrative function that grew out of the studies of management in the 1950’s. We know that employees are more productive when their manager is paying attention to them. Today HR should exist to impact and grow your business with a focus on positive employee interactions.  If it’s just administrative – outsource it!

Step Two: Gather data. Who in your organization is responsible for budget items that impact employees. Ask for feedback from vendors that interact with your team such as your payroll provider, benefits consultant etc. Talk to employees, who is their go-to person for information?  What is the cost of running HR – and what have they saved you by watching your back!

Step Three: Separate the basics of HR from your strategic needs. Much of the HR function is in face administrative. These are actions that are easily outsourced, or conducted through enhanced technology. Be sure that your HR function is embracing technology, and spending their valuable time on initiatives that will drive the business results you are looking for.

Step Four: Consider the team. Selecting or evaluating the person responsible for HR should be very strategic. Human Resources is best served when it reports directly to the CEO, only then can the focus be solely on the overall operationIn smaller organizations, we see HR reporting to finance or operations. In others, HR is handled by an office manager or other administrative person.  The reporting structure is critical in sending a message of importance throughout the organization.

Step Five: Set an expectation for Human Resources to be a business partner that will impact corporate goals. Invite HR to critical meetings so they can understand the equipment required for future production, new markets you are entering etc. It is only with the business knowledge that HR can create programs that will add to the attainment of corporate goals.

There must be proper alignment between CEO, HR leader and the rest of your organization. Ultimately, you need an HR function that is going to be a trusted member of your team. The CEO and HR leadership should agree on what is needed from the HR function. We do not suggest you make these decisions in a vacuum, rather have the conversation with Leadership and HR and determine if you are both headed to the same goal.

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