For a business to function, irrespective of its size, it needs all of its departments to work in synergy with one another. The two most important departments in this regard are Finance and HR. Typically, the mention of one department excludes the other, and each is drastically different from the other in terms of both operation and thinking capabilities. The HR department, for example, would most likely argue that employees are a business’s most valuable asset, whilst the finance department might believe that cash is in fact the greatest business asset.
It is clear that the two departments are not fully aligned with one another. Over the years, however, there has been a realisation that Finance and HR, irrespective of their agendas, are working towards a common goal: business growth and development. This has meant that the two departments have progressed cooperatively, a process that is being led by the heads of each department, the CFOs and the CHROs. The fact that HR needs financial management, and the financial department needs HR, is why the two departments need to work in close coordination regardless of their varied views.
A few examples of this could include the following situations:
The finance department can plan on managing the finances of the business effectively, but it cannot do so if the human resource department does not recruit the right financial officers and staff to manage the businesses accounts.
From the onset, recruiting staff seems like the core competency of the human resource department in a business. Typically, however, HR will need to consult the finance department before being able to agree the salary and financial benefits to be awarded to an employee, since the financial department will have the true picture of the business’s financial state.
The provided examples are the core competencies of the respective departments, and yet the fact that both need one another to effectively perform these functions demonstrates the need for greater cooperation between them, in order to achieve business growth.