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Should HR and Finance Work Together?

Posted on September 1, 2016 10:00 am;

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By Lyndsey Mclaughlin


HR and Finance are two functions which have a lot in common, however, it is often the case that the

two don’t really want to work together. The reason for this is quite simple; finance spend their time

trying to control and reduce spending in the business, while HR are responsible for the highest costs

in the business, through human capital. Neither HR or finance are bringing money into the business,

they are both overheads and support functions to the rest of the business. However, when the two

work together, they can help to improve the overall success of the business for various reasons.


Better Hiring Decisions

The largest cost for most businesses is payroll and as such, it is important to make the right decision

when hiring new employees. The cost of hiring the wrong person can result in the loss of thousands

of pounds, whereas the right choice can make the business much more profitable. Through working

together on the hiring process, HR and finance can help the business to make better decisions. For

example, instead of focusing purely on budgets, HR can also share their opinions, which enables

both parties to reach a more informed and balanced decision.


Achieve Goals

HR and finance may not bring in revenue to the business, but they are both departments who are

responsible for making major strategic decisions for the good of the business. By taking the financial

and personal perspective together, strategies can be more aligned to the goals of the business, thus

making the business more successful.


Improve Efficiency

There is often a debate about whether finance and payroll should share systems and what effect this

would have on the business. In many cases, this could actually be highly beneficial for improving

efficiency and reducing costs. With the two departments working closely together, smarter decisions

can be made in terms of what employees want and where there is unnecessary spending within the



There are many different sides to HR and this also includes ensuring the structures of the business is

set up in the most efficient way possible. This is often the kind of knowledge which only comes from

proper HR training, where you can learn to improve processes, as well as getting the most out of

your staff for the overall success of the business.

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