It's budget planning season for many of our clients and I have sat in on several discussions over the last few weeks of how to best substantiate and present a business case in order to get maximum dollars for the economic turnaround. With so many organizations still focused on cost containment, they forget the basic tenet that an organization's human resources will support the economic turnaround on all levels and contribute to a company's overall success when the market turns around.
As has happened with every recession, jobs do come back, sometimes very quickly and with a vengeance. It's imperative for your team to be prepared and at the forefront of the competition for labor as it heats up. As 2010 unfolds, people are cautious to both act and ultimately plan ahead. What we're seeing in private sector employment is indicative of the last two economic troughs we have experienced. If history repeats itself, 2011 could be a significant challenge in terms of recruiting, attracting/retaining talent and taking the time to prepare and request resources. That time is now.
I recently came across an article entitled "How To Get The Budget You Need" by Pat LaPointe which specifically spoke to media planners in the online media industry. The premise of the article certainly carries through to human resources in its simplicity.
When approaching the budgeting process there are several "basics" to consider that will increase the probability of getting the resources needed to sustain the organization during the economic turnaround.
In your budget proposal, properly ensure that the organization's staffing goals are tightly associated with corporate growth goals/objectives.
The closer you can demonstrate links to revenue, profit, customer value, market share, etc, the more chances you'll have for success. Keep the emphasis on future business outcomes and corporate value.
Have a plan for how you will strategically prioritize your program, not just tactically.
If you get another dollar, where will you strategically spend it? Don't describe programs or tactics, but think about candidate pools, "hot" recruitment markets, and what your competition is doing, keeping in mind that your corporate competition may not be the competition you face when recruiting.
Identify key metrics and how much they cost the company like days-to-fill, revenue-per-employee, agency spend, etc. and calculate both turnover costs and the net of retaining your employees.
There are several excellent resources through SHRM and on the web, or feel free to ask your TMP contact for some ideas.
Make sure you've squeezed every drop out of your 2010 budget.
For those that are calculating track-to-hire or cost-per-application statistics, this is the time to evaluate where you've been, what progress you've made this year and ensure you don't leave any excess inventory from 2010 contracts on the table. Talk to your TMP representative to see if it's possible to convert excess or roll it into 2011's program.
Ensure you drive home the point that employer brand, although related to consumer brand, is entirely unique and needs to be addressed separately.
Based on a survey conducted in Q2 of this year, TMPs brand team has equated the monetary value of a compelling Employee Value Proposition. For instance, based on a $50k salary, participants would be willing to take an average of $684 less, if they were convinced an organization did a good job of providing advancement opportunities.
Demonstrate an understanding of how the HR space has changed in terms of recruitment and retention.
Have specifics and statistics ready at hand speaking to the trending in the recruitment and retention space. Information about social media, search engine optimization, marketing and ATS capabilities all play a critical part in your 2011 budget. ROI and campaign management/measurement will play an even bigger role in substantiating an increased or diversified spend.
Propose ROI standards and targets for success.
Benchmark the ROI (of where your current program stands) and where you want to arrive in 2011. Base numbers off trending to that goal.
Consider all options in 2011 in terms of reallocation of funds.
Your organization may not need as large an increase as you think if you're reallocating funds to both search and pay-per-click models. Work through various scenarios with your TMP representative to see exactly what you'll need.
As far as the actual presentation/submission of your budget:
Present the plan proactively, instead of waiting until budget time.
Make sure you project excitement, not desperation for budget dollars.
Focus on the fact that you are presenting an opportunity to drive additional revenue and customer value.
Remember to equate HR's success to the company's bottom-line.
Tough times offer a tremendous opportunity for progressive organizations to jump ahead of their competition in seeking talent. Make certain you have every available resource by thinking and acting proactively. Feel free to contact your TMP representative to assist with any portion of this endeavor, that's what we're here for.
Sources: How To Get The Budget You Need., Pat LaPointe, MediaPost's Online Metrics Insider, June 8, 2010.