3 Budgeting Tips to Bring Your HR Budget New Life

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3 Budgeting Tips to Bring Your HR Budget New Life

Developing your annual HR budget can become monotonous when line items stay the same year after year. Shake things up a bit and give your budget the refresher it so desperately needs. Here are a few easy tips to ensure your budget reflects your actual department needs.

1. Review the Strategy

The HR department often flies under the radar when it comes to being a powerhouse in the organization. Yet, it’s the HR department that has to control and react to turnover, benefit increases, policy changes, and much more, that truly affect the way an organization works and conducts business.

By reviewing the organization’s strategy, you can predict and adjust your budgeting based on where leadership sees the organization going over the next 3-5 years.

2. Set Goals

Along the same lines of the organizational strategy, review your company’s goals for the next year, or 3-5 years, and align the HR department’s goals accordingly. This will ensure that the money being spent supports the future vision of the department and the organization.

If you establish a goal of decreasing the organization’s turnover rate, you may see that your recruiting and selection numbers increase. You may also increase leadership and professional development numbers to increase your retention rate.

3. Prepare for the Unexpected

As with many things in life, sometimes business will throw a couple of curveballs your way that you have to react to. It’s important to remain flexible with your budget. HR departments have to anticipate federal and state law changes that may, in some cases significantly, impact their business and their budget.

Budgeting can be seen by many professionals as a necessary evil but when you take a step back and inject the organizational strategy and set goals, budgeting can become an exciting opportunity to enhance the HR department’s role in your organization.

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