Talent Acquisition, recruitment, and HR are often viewed as a cost center rather than as a profit center. This can cause friction between TA, HR, and recruitment on one side, and the CFO on the other.
Guess what? It’s not your CFO’s fault.
CFOs are not monsters. Talent Acquisition and HR professionals need to stop
treating them as the enemy. We all have the same goal - the success of the company.
We get it. You’re in the people business. You’re looking at how the organization runs on, for, and around people. That’s important. That’s your job. But the CFO is looking at the data that affects the bottom line.
If you aren’t able to communicate the value of TA, and why appropriate hiring and firing tools and methodologies are critical even during a period of stagnated growth or layoffs, your CFO can’t make data-driven decisions around “people investments”.
To become your CFO’s best friend, you have to be able to translate what you know about people into data points that show their value.
You have to change your CFO’s viewpoint so they see TA and HR as more than a sunk cost that must be justified, and instead appreciate how recruitment done right can be a powerful cost-saving proposition and revenue driver for your organization.
Understanding Your CFO
CFOs are money-oriented people who are laser focused on cash going out and cash coming in. They are responsible for ensuring expenditures are wise, to maximize revenues, and trust data over presentations when it comes to appeals from different departments to maintain or increase budgets.
This makes it easy for people who aren’t holding the purse strings to see the CFO as a curmudgeon who doesn’t care about anything but the immediate bottom line and whose automatic go-to when faced with a request is “No.”
When the CEO says “cut costs”, the CFO will naturally go for the point of least resistance, and staffing can feel like low-hanging fruit when you want to drastically improve on-paper quarterly reporting before a shareholder’s meeting.
That doesn’t mean you have to fight your CFO or beg for what your department needs. Instead, you have to make a logical case that uses clear, convincing data points that make the connection between supporting a robust recruitment ethos even during a downturn.
Retention could actually be less costly than firing and rehiring
Which of these scenarios makes more sense?
1: A process that starts with firing 1,000 people, then a few months later starts the whole costly recruitment process from step one, including:
- Job postings
- Application screenings
- Reference checks
2: A process that strives to keep knowledge, skills, and employee loyalty intact, using data about existing employees and the current labor market to make decisions:
- Keeping top performers who can be shifted laterally
- Retaining knowledge and skills that could be difficult to replace
- Paying salaries now in lieu of recruitment costs later
- Improving and maintaining employee and public perception of company values
Out of those one thousand people whose jobs are at risk, you need a way to identify which people are amazing employees and top performers who could be great candidates for some of the upcoming 800 roles, and smoothly transition them into place. In a real-world scenario, the right answer may be a hybrid of these two options. Data-backed layoffs of some and organization restructuring may help efficiency and save money in the short-term, plus investing in keeping and shifting top performers to ride out the current situation will improve productivity and create a more future-proofed workforce.
When everything is falling down, plan ahead for the inevitable rebuild
Being aware of company upheaval below the surface, and recognizing when a layoff may be inevitable is critical for TA and HR teams who want to ensure recruitment isn’t cut off at the knees. Indiscriminate firing and a failure to maintain a strong recruiting ethic can mean months or even years of recovery when the dust settles and the organization goes back into hiring mode.
To avoid what can feel like complete devastation across HR and recruitment during tough times, talent acquisition leaders must be ready to present their CFOs with clear, irrefutable data about the company’s personnel needs - past, present, and future.
Where is the company going after the current crisis is over?
Start to think differently about how you manage and measure your “people investments”. Even if you have to trim away staff right now due to market downturns, when everything comes back you're going to need amazing people to do the work and you'll need them fast.
The CFO may be focusing on the next quarter. Get a few steps ahead and look at the next year. There are key people you’ll need right now and in the future, so protect them. Carefully decide who goes and stays based on performance and fit; last in, first out mentality doesn’t work anymore (if it ever did).
Ultimately, you have to remain in a positive position when it comes to getting everything you need done accomplished over the next twelve months. Firing 1,000 people now when you are definitely going to need at least 800 new hires for a serious project in 12 months can mean you’re spinning wheels and wasting money.
How many of the thousand you’re considering getting rid of now are great employees who could take on some of the upcoming roles that will be required? The costs of processing mass terminations then kicking back into recruitment mode to hire again a few months or even a year or more later could dwarf those of a solid departmental restructuring and cross-training program.
Show Them The Money
CFOs are open to working with HR and recruitment, but they need data in order to be strategic, focus on the success of the company, and create value for the shareholders. Everything you present to your CFO needs to be tied to ROI.
Want to put the brakes on firing a large number of employees? Find a way to show your CFO that keeping as many as possible of them actually means a better cost-benefit for the company.
Offer alternatives such as performing skills analysis, performance ratings, and company culture surveys to identify duplicated efforts, low performers, and toxic employees. Remove underperformers and employees who fail to provide culture add, and freeze salaries if necessary.
Make it clear that you’re asking for tools, not toys
Tools are just that: tools, not toys. Find ways to express the long-term value of your pipeline to justify continuing that investment in the pipeline. Showing ROI in this market is critical, particularly when it comes to software investments.
Purchasing decisions have fundamentally shifted from lower-level managers to more senior executives and everything has to be signed off by the CFO. They don’t care about or understand the inner workings of most of the tools, but they can understand data and ROI.
Remember that your CFO wants the company to succeed as much as you do, and show them how specific tools or platforms make that possible. Show them the money by presenting scenarios in which software investment pays for itself over and over.
Create shared conviction and back it up with solid ROI numbers
Believe in what you ask for before you ask for it. Do the research, and achieve buy-in at your own level before approaching the finance department and CFO for backing. This makes it easier to get them to believe as well, and puts you both on the same side.
When you can bring conviction to the table alongside hard hitting ROI (both hard dollar savings and soft dollar savings) you’ll be able to make the most convincing argument that a specific investment will drive real value for the organization.
The Case for Crosschq
CFOs understand data. With Crosschq, all the data you need is right there, organized, and ready to be put to work creating conviction and belief in how you can improve productivity, morale, effectiveness, and the bottom line.
It will be easy to tie the advantages of Crosschq and process improvements directly to ROI to convince your CFO that such an investment aligns with short- and long-term business goals. By bringing them solutions instead of asks, you’ll quickly become their best friend instead of an adversary.
Connecting HR and TA metrics to business metrics
Faster, easier hiring benefits your talent acquisition specialists, recruiters, and HR managers in ways that are easy to measure for your team. You’ve got plenty of KPIs that you look to regularly to improve your hiring strategies.
To get your CFO on board, identify and measure the specific KPIs that affect the company’s bottom line. Of these, metrics that focus on productivity, employee engagement, and cost of hire can all be leveraged to create conviction that Crosschq is “worth it”.
According to Gallup, there are four human capital strategies which can be combined in powerful ways to add up to 59% more growth in revenue per employee than average. The additive nature of these strategies means you can use them together to help bump your annual organizational revenues in a major way. What CFO wouldn’t love that?
1. Hiring the right managers
Only one in ten people have natural managerial talent. Identifying and hiring these people based on their ability to manage others effectively is key to having a high performance team. When companies systematically pick the right managers, they can achieve 27% higher revenue per employee.
- Crosschq is the ideal tool for surfacing similarities in your top performing managers, and using that data to find new managerial candidates who share those same attributes.
2. Developing the right individuals
Companies that select and develop employees based on their natural talents have an opportunity to accelerate business growth, resulting in an additional 6% higher revenue per employee. Unfortunately, many companies display bias for candidates who have specific education and work experiences over those who may actually have better attributes for the job.
- Crosschq helps remove bias from the hiring process, improving diversity, supporting culture fit, and identifying existing employees who are perfect for internal development.
3. Increasing employee engagement
Companies which have concentrated on engaging their workforces see up to 147% higher earnings per share (EPS) compared with their competitors, and can hold their own even in a down economy. A culture of employee engagement can lead to up to 18% higher revenue per employee.
- Crosschq supports employee engagement from the earliest stages of the candidate sourcing and hiring process through the interview and offer stage and into onboarding and training.
4. Focusing on employee strengths
Companies get the most from their workforce when they help employees identify and use their strengths. Employees who use their strengths every day are six times more likely to be engaged at work. When teams learn and focus on their strengths every day, their productivity improves, producing up to 8% higher revenue per employee.
Making it all add up for your CFO
When making the case for Crosschq and related tools, emphasize the impact on employee productivity and engagement, both of which have been proven to impact the organizational bottom line. Focus on how the tool helps you:
- Identify the best candidates for the job
- Reduce the risks of a bad hire
- Saves time and money across the recruitment process
- Improves employee retention
Don’t forget how Crosschq helps boost diversity and inclusivity, and remember to mention that diverse companies attain 19% higher revenues than monolithic companies thanks to greater innovation!
Finally, draw attention to how Crosschq provides valuable insights into your hiring process, leading to better Quality of Hire. Not sure how to measure and use Quality of Hire as an argument for investments in recruiting? Download our most recent Crosschq “Q” Report.
Increased Quality of Hire improves all of the above metrics, and can have long-term beneficial effects, helping you build a loyal, future-proof workforce that defies downturns and stays ahead of the knowledge/skills curve.
You and the CFO Are Now BFFs. Go Forth and Conquer
By coming to your CFO from a place of joint conviction, understanding, and data sharing, you can build a strong relationship and achieve clarity about budgetary and organizational goals and how to work together to reach them.
Once you have successfully managed to get yourself and your CFO on the same side, it’s time to get to work. Armed with the information Crosschq provides, it can be easier to find ways to handle recruitment and staffing issues in times of organizational crisis without burning everything down and having to start over.
For more information on how Crosschq can be a valuable tool for CFOs as well as TA and HR professionals, contact our team today.
From pre-hire to post-hire, Crosschq helps you source, screen, onboard, and measure the best talent. Fast.
Request a free demo from a team expert to see how we can help your company.
Talent Consulting LeadView All Articles
Topics from this blog: Recruiting Metrics Human Intelligence ToolsBack
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