I\u2019ve written before about how often HR does not speak the language of finance that executives need when presenting business case.\u00a0 Often, HR\u2019s projects are on the backburner or are not approved because HR simply can\u2019t articulate to the same degree what all the possibilities are when they need money.\u00a0 A simple ROI or TCO is often not enough.<\/p>\n
ROI generally takes an analysis of costs and opportunities for savings based on a set of assumptions.\u00a0 We\u2019ll have \u201cX\u201d number of transactions on self service, we\u2019ll reduce \u201cY\u201d pieces of paper, and approvals will take \u201cZ\u201d less time.\u00a0 However, how often does HR perform sensitivity analysis around X, Y and Z to see if small changes in any or all of those components will radically change the ROI?<\/p>\n
Say for example, if the number of transactions on self service are drastically lower than assumed?\u00a0 It\u2019s possible that the savings are proportionally lower as well, and your ROI assumptions are just bad.\u00a0 On the other hand, if the amount of paper you process is going to process does not change the ROI figures much, then this metric is less sensitive.\u00a0 In other words, you know from sensitivity analysis which assumptions are the ones driving changes in ROI, and which ones are more fixed.\u00a0 Those metrics that drive changes in your ROI are your higher risk items.\u00a0 Your executives will want to know what happens if your assumptions are wrong, but they will also want to know what you\u2019re doing to make sure your assumptions are indeed right.\u00a0 In this case, driving processes to the self service site is an adoption and usability issue.\u00a0 You can drive adoption through good change management.<\/p>\n
Often, HR is stunned when walking into a CEO, CFO or COO\u2019s office and getting challenged on their business case.\u00a0 Understand that it\u2019s their jobs to understand and challenge any numbers you put in front of them.\u00a0 They simply can\u2019t let you buy something for the business that is not proven.\u00a0 Your ability to tell them that even if your assumptions are wrong by 30% (or whatever) you\u2019ll still be able to break even in an acceptable timeframe for the investment.<\/p>\n
Don\u2019t be stunned by getting challenged, but also expect to be very prepared.\u00a0 Often, the best course is to partner with some finance guys (build a relationship, and don\u2019t be a dope about it).\u00a0 These guys can not only do the financial analysis that takes us days (they do it in minutes), but they can also inform us what analysis is really needed.\u00a0 As I go from company to company, what the CEO looks at is always different.\u00a0 It\u2019s always good to have the finance guys on your side helping you to prepare.<\/p>\n","protected":false},"excerpt":{"rendered":"
I\u2019ve written before about how often HR does not speak the language of finance that executives need when presenting business case.\u00a0 Often, HR\u2019s projects are on the backburner or are not approved because HR simply can\u2019t articulate to the same…<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_coblocks_attr":"","_coblocks_dimensions":"","_coblocks_responsive_height":"","_coblocks_accordion_ie_support":"","footnotes":""},"categories":[33,8],"tags":[],"class_list":["post-891","post","type-post","status-publish","format-standard","hentry","category-finance","category-strategies"],"_links":{"self":[{"href":"https:\/\/systematichr.com\/index.php?rest_route=\/wp\/v2\/posts\/891","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/systematichr.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/systematichr.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/systematichr.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/systematichr.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=891"}],"version-history":[{"count":0,"href":"https:\/\/systematichr.com\/index.php?rest_route=\/wp\/v2\/posts\/891\/revisions"}],"wp:attachment":[{"href":"https:\/\/systematichr.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=891"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/systematichr.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=891"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/systematichr.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=891"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}