With strategic planning coming up for many companies, I wondered how human resources leaders could enter that process as stronger and more strategic partners, so I interviewed a senior finance executive—and former management consultant—at a global public technology company. He agreed to offer frank advice on the condition he could remain anonymous—here’s what he told me:
As a finance leader, I've seen countless strategic planning cycles. HR typically comes to strategic planning meetings asking for more heads or more money for training or benefits programs. My advice to HR leaders heading into this year’s strategic planning cycle: Don’t fall into the trap of just asking for more.
Too often, HR leaders are relegated to being mere customers of the process, rather than strategic partners, meaning they’re passively receiving directives from finance and relaying them to the business. What I wish I saw from HR is a strategic perspective on what areas of the business need to grow and which could potentially shrink. They should be making decisions on the number of people that should be staffed in a particular area of the business, the structure of that area, and where more people are needed versus where we could cut back. An obvious example is understanding how AI could augment the work of roles and teams throughout the organization.
HR needs to understand what the human capital needs are that are actually going to generate positive return on investment (ROI). I don't expect HR to come up with numerical ROIs for everything they're asking for. That's probably a stretch. But if they worked with their finance partner or other business leader, together they could put together business cases for where they're asking for additional funding. This doesn't happen much in the HR world, from my experience, and it should. It’s a missed opportunity.
In addition to everyone going into these exercises asking for more resources, more heads, more money—often more than they actually need—they treat the process like a negotiation where you anchor high and hope you get what you actually want. That immediately puts you on the other side of the table from finance. We have to be the bad guy looking for ways to say no, or arbitrate and meter out the dollars or heads, which are few and far between these days.
Instead, go into that process with a two-sided approach. Show us where people are not that busy or where programs don't seem to be generating a lot of return. Identify areas where we can save or redirect investments to generate better returns or speed up high-priority projects. Know your assumptions well and ensure they are both defensible and align with the broader direction of the organization. For example, if you expect 7% attrition next year, be prepared to explain why. This balanced perspective will help you gain (or regain) credibility with the finance team.
By taking this more balanced, strategic approach, HR leaders can transform their role in the planning process. You'll shift from being seen as just another department asking for more to a true strategic partner, helping to shape the direction of the business. That's the kind of HR leadership that finance—and the entire organization—desperately needs.
HR leaders know their roles extend beyond headcount planning, and yet I’ve heard from so many who struggle to be seen as strategic, to align initiatives to business objectives, and to articulate the long-term value of investing in people and culture—all challenges I wrote about in my recent piece, “Strategic HR is at risk.” We’re sharing this finance leader’s point of view so that HR leaders who read it can begin to build closer collaborative relationships with finance—not just heading into strategic planning cycles—but throughout the year in order to develop a shared understanding of both the quantitative and qualitative aspects of human capital.
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