How to control the cost of human resources

In enterprises, HR department is often regarded as the cost center, because HR department can't directly create quantifiable performance for enterprises like other business departments. However, no one denies that HR department is the management and integration department of human resources. Since it involves the management and integration of resources, it should not be a simple cost center, but a "resource management and value-added" department, and it should be possible to measure the management performance of HR department with cost-effectiveness.

As the HR department does not participate in direct business operations, its contribution to revenue is reflected in reducing costs, mainly in two aspects: first, the reduction of the operating costs of the HR department itself; The second is to help organizations reduce operating costs.

The actual operating cost of the human resources department itself is relatively limited. Modern enterprises have done a good job in controlling management expenses. The real problem is that HR department manages the most important and core resource needed by the development of modern enterprises-human resources. How to reduce the cost in the process of resource integration and appreciation is the most important and core issue that HR department needs to consider.

If reducing its own operating costs is throttling, then improving the input-output efficiency of human resources management departments is a typical open source. Throttling can be achieved through "activity-based cost control", but open source requires more complicated "operating system optimization". In other words, the contribution of HR department to cost-benefit lies in continuously improving the input-output efficiency in human resource management through the optimization of operation system.

The optimization of human resource operation system can start from five stages:

In the first stage, by performing departmental functions and job responsibilities, the functional expenses are controlled as much as possible. In management, we often ask for eight words: do your duty and do your best. This is the basis of management. We should do our best to do things well according to the requirements of the organization, not to mention creating performance miracles, but at least to make the resources paid by the organization have an appropriate return. There are four basic functions of HR department: helping business departments recruit people, assisting employees to learn and develop themselves (educating people), assisting business departments to improve performance and provide incentives (employing people), and managing employee loyalty (retaining people). Some functions are directly performed by the human resources department, while others are assisted by the human resources department. Whether directly executing or assisting in execution, the human resources department should do a good job in management within its functions, which is the basis for controlling the cost of activities. Be directly responsible to the management department of the company and make every effort to reduce the cost to the lowest possible level according to its requirements.

In the second stage, through "activity-based cost control", the functional expenses are reduced to the lowest level. It is not enough to do one's job dutifully, but also to have a sense of principle and minimize all costs. Specific to the four basic functions, the principle of activity-based cost control is:

1. By means of human resource planning, position analysis, function definition, position description, etc., the recruitment work will be brought into the track of standardization and process, so as to be aware of the recruitment before, be targeted when recruiting, and be responsible after recruiting. Only in this way can we change the disorder and randomness of recruitment and reduce the recruitment cost;

2, through the establishment of training system, internal knowledge management and sharing system, employee career planning, etc. , to help employees learn and develop, and constantly improve their professional quality and ability, so as to enhance their loyalty to the organization and constantly improve their profitability. In this process, there are three key control points:

There should be a qualified training manager.

He may not be a qualified training lecturer, but he must be an excellent expert in planning and purchasing negotiation. He needs to know how and where the company's limited training budget is spent, how to choose training partners, how to cooperate with training lecturers, control training quality, and what to do to fix the training results and become the company's knowledge resources. Finally, he should also be a person with high integrity and will not betray the interests of the company for training kickbacks. From the development point of view, most of the current training managers become monks halfway, and very few really meet the qualification requirements;

In the company, there are systems such as knowledge textualization and "mentoring" experience transfer among employees, so that the excellent experience of outstanding employees can be transformed into replicable knowledge and transmitted to more employees to the maximum extent;

Establishing career development plans for employees, especially core employees, to help them develop their personal abilities is actually to help the organization develop.

Some people may say, what should I do if the staff is lost? Isn't the cost of educating people all for nothing? When we encounter this problem, we should look at it from two aspects: on the one hand, what are the reasons for staff turnover? Can you find your own reasons and reduce the employee turnover rate? On the other hand, in the two-way choice market, the loss of employees is an inevitable fact. You can't expect every employee to devote his life to the organization faithfully. You can't get their 100% future. The only thing you can have is their present-that is, when you worked in your company. Good learning and development planning can increase the "present" value of employees and make them contribute more profits to your company during their work. If there is no training development plan, not only can we not count on the future of employees, but we will also lose their present;

With the previous foundation, the next thing to consider is how to reduce the cost of employing people. The reduction of labor cost is a typical process management, which needs the lead of the labor department and the full cooperation of the HR department. Therefore, it is necessary to establish a process-oriented comprehensive performance management system. The characteristics of process-oriented total performance management are:

Target decomposition, responsibility to people-process control, detail supervision-two-way communication, team strengthening-clear rewards and punishments, immediate results-self-centered, focusing on improvement.

I'm afraid no company wants to have a high employee turnover rate-especially the loss of core employees, which will make the company suffer huge losses. Excessive employee turnover rate will inevitably increase the cost of recruitment, education and employment, and the loss of core employees will more easily aggravate the weakening of the company's core competitiveness. The question is, how to retain talents is a reasonable way to meet the cost-benefit requirements?

If the employee turnover rate is really high or the elite employees keep losing, you may have to hide in the corner first, slap yourself a few times, and then ask yourself: Why? Why not nip in the bud? Why didn't they find out until they left their jobs? Employees will not lose a lot for no reason, nor will they suddenly leave their jobs overnight. There must be obvious loopholes in management, which lasted for a period of time and caused a situation out of control. What we are talking about is to implement the idea of process management from beginning to end, so as to achieve active early warning, rather than simply passive response.

Secondly, when retaining people, we should focus on non-monetary aspects as much as possible. Relatively speaking, it is easier to play a positive guiding role by retaining people with affection and retaining people with things. Of course, the premise of this is that the company's salary is competitive in the industry.

Finally, retaining people is a good thing, but sometimes it is not a bad thing to turn "retaining people" into incentives. For example, some companies implement the "last elimination system" in performance, but when it is implemented, it is a bit too uniform to take performance as a measure. For those employees with poor performance but positive working attitude, it is advisable to express the meaning of "retaining" at an appropriate time, which can often play a certain incentive role.

The key point of retaining people is not to "retain people", but to "pay attention" at ordinary times. Those who stay can't stay, and their work performance can't come up. On the contrary, they will occupy the company's resources and only cause greater costs.

In the third stage, HR department should pay special attention to the balance of the relationship with straight-line functional departments when implementing business management. The human resources department should cooperate with the direct business department to reduce the costs related to marketing, sales, engineering and technical support, on-site service support, information technology expenses and management expenses. In other words, in addition to doing their own work, we should also help other departments to do their own work. At the very least, we can do it without causing trouble to the work of other departments and without excessively increasing the hard expenses of departments.

Here, I would like to remind you in particular that if it is not necessary, or the current scale and development of the company has not reached the point where it is necessary to introduce more advanced human resource management tools, then don't casually suggest your boss to introduce some dazzling new systems such as KPI and BSC in the company-even if it can fully highlight the professionalism of the HR department and your importance. If these new systems not only increase the workload of business departments, but also can't prove to have an obvious effect on improving business performance, it will only increase management costs and cause resistance from all other linear functional departments.

In the fourth stage, the awareness of customer service is introduced, and employees in the organization are regarded as customers. By improving the service quality, we can reduce the cost and improve the performance.

In the fifth stage, efforts are made to make the HR department become the strategic partner department of the company from the traditional functional department. The core issue is to give full play to the leading role of human resources department in the process of building corporate culture system. Within the organization, only HR department has enough resources and ability to lead the construction of corporate culture system. Because corporate culture is based on "people", and HR department is only the work of being a man, it should take the initiative to undertake the heavy responsibility of building corporate culture system, which is also the basis for HR department to become a strategic cooperation department. Through the efforts of HR department, enterprises can establish a strong culture, give full play to organizational influence and team cohesion, and make more people willing to invest in performance creation in a more recognized way. If the first four stages only analyze the cost optimization of HR department tactically, then at this stage, the cost optimization of HR department has risen to a strategic height. Only in this way can HR department really enter a virtuous circle of input-benefit and make more contributions to building the core competitive advantage of enterprises.