- Almost all (92%) of HR leaders have prioritized budgeting and cost optimization, a study by Gartner revealed. The research also found only 20% have considered how their cost optimization helps overall savings for the company.
- HR leaders "struggle to monitor the economic business cycle and anticipate times of economic uncertainty and volatility," Gartner said in a news release. Because of this, leaders resort to cutting costs when financial forces begin to damage their organizations, rather than preparing for downturns ahead of time.
- HR can partner with other leaders "to establish a cross-functional dashboard" in monitoring warning indicators, said Daniel Dirks, managing VP of Gartner's HR practice. This allows leaders to develop "a more accurate forecast about the economy and potential issues," Dirks said.
Gartner is not the first to suggest HR connect with other departments to prepare for a financial downturn. Opening up interdepartmental communication could allow leaders to understand how consumer-facing operations will change, for example, if some behind-the-scenes jobs are cut, experts previously told HR Dive.
As HR professionals reach out to other organizational leaders to assess the economy, they may find such partnerships lead to other benefits, as well. The HR and finance departments should work closely together to understand how the employee experience impacts the bottom line, according to Robert Half Management Resources Executive Director Tim Hird. What's more, if HR and finance do not align their goals, it may appear that the two departments are working against each other, another expert previously told HR Dive.
HR departments are often looking for ways to become more strategic. One way they can achieve that goal is to ally themselves with different levels within their organizations, International Center for Strategic Planning CEO Sherrin Ross Ingram told attendees at the 2019 Society for Human Resource Management Annual Conference. This allows HR to access more perspectives: "C-suite folks almost always gave solutions that involved spending money," she said. "Frontline, it was about utilizing things you have already."