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Insights from a CEO: Removing the stigma of HR as a cost center

Consider the human resources department: Is it a center for strategic thinking or a cost center–necessary but still a burden on the bottom line rather than a contributor to profits?

That’s one question to explore as HR professionals work to earn the “seat at the table” they’ve long sought. Recently, a group of HR professionals heard ideas from the perspective of a CEO on how to elevate their standing. As part of the 2012 Advanced Employment Issues Symposium, Dan Oswald, CEO of human resources information provider BLR, highlighted the importance of contributing to an organization’s bottom line.

We’re presenting a series of three videos from the presentation that focus on how HR can participate at the highest level of management. In the first video, Oswald stresses the need to speak the language of the C-suite. In this second installment, he focuses on shedding the cost center reputation.

One way to show the C-suite why HR should be involved at the highest level is to offer solutions to dollar-draining problems. For example, high turnover is a problem HR has the expertise to solve. “So you walk in my office with a plan and tell me you can cut turnover in half. You’ve got my attention,” Oswald told the group.

HR should expect top management to demand data–how much is turnover costing and how much will it cost to implement a plan to reduce it. Without hard data, the CEO doesn’t have the information needed to decide if the plan is a good place to put the company’s money.

When HR professionals are able to give the CEO vital information, they can make the C-suite realize how HR can make a difference in the company’s bottom line.

Dan Oswald writes The Oswald Letter a free weekly e-zine, providing readers with management and leadership advice and a look at how members of the C-Suite view the workplace. Sign up to receive The Oswald Letter at www.hrhero.com/enewsletter.cgi. You can read past issues of The Oswald Letter at blogs.hrhero.com/oswaldletters.