Ah, August – a month of sunshine and relaxation. Yet, as the warm days roll on, it's time to cast our thoughts to the inevitable year-end rush, and that includes budgeting for next year. This time of year marks a crucial period of planning for the year ahead, especially for HR leaders who support both the HR function and the overall business. But here's a common pitfall: HR budgets focus on new tools and programs planned for the coming year, but neglect the essential ecosystem that makes them thrive.
At Nua, we see it way too often: budgets include funds for a cutting-edge HR program or a new system, but the implementation falls flat or isn't as effective as anticipated. Why? Because the budget didn't account for everything else that's needed to make it work seamlessly – resources, expertise, materials, project management, and more.
In reality, many HR budgets suffer from tunnel vision. They see the destination but fail to plan for the journey that gets them there. When a new program or system is introduced, a lack of planning and budgeting for the necessary resources for process reengineering, change management, and the human touch can lead to unmet expectations and a disjointed experience for all involved.
If you're gearing up for your next year's budget, don't fall into the same trap. Here's how to steer clear of the pitfalls and ensure your HR initiatives are set up for success:
1. Think beyond the Vendor
With so many amazing technologies and vendors in the HR marketplace today it’s easy to think that the budget you have allocated for a vendor has got it all covered. But we see it time and time again, even if the vendor does provide “end-to-end” support, teams can fail to account (and properly budget) for internal resources – people who will be involved in the project, training, and ongoing support - and external resources who have top of the market expertise and can augment your team to get you to the desired result faster and help you avoid mistakes that can be costly long term. Don’t forget to account for those “hidden costs” you will need to absorb with your own or supplemental resources.
2. Plan for Process Reengineering
When a new program or system is implemented, it often necessitates a reimagining of the old ways of working. Allocate funds not just for the new program or tool itself, but also for the time and resources needed to carefully analyze and adjust workflows, ensuring efficiency and alignment with your organization's goals.
3. Allocate Resources for Change Management
A successful change requires effective change management. Set aside resources from the start of the initiative to build change management strategies, create communication materials, and engage key stakeholders and employees at every step. After all, a new program, process, or technology is only as effective as the team that adopts it.
4. Designate Project Managers
Every successful endeavor needs a captain. Build in the resourcing in your team and budget for designated project management to oversee the implementation, coordinate teams, and keep everything on track. Transformative initiatives can be fantastic career development opportunities, but only if resources are augmented with the right capacity and capability. This investment could make or break a project and the ultimate achievement of desired business outcomes.
Conclusion:
As August wanes, it's time to gaze beyond the beach and prepare for the annual budgeting whirlwind. Avoid the all-too-common HR budgeting pitfalls by broadening your perspective. Budget not just for the tools, but for the orchestration that brings them to life. Process reengineering, change management, designated project managers, and resource allocation are the cornerstones of a successful HR initiative.
Need help planning your HR budget or supporting key initiatives that pave the way for HR success? Get in touch with our team at Nua Group. We're here to help you navigate the complexities of HR budgeting, ensuring your initiatives are set up for triumph, from start to finish.