The roles of HR and finance have always been intertwined, but today they are truly converging. An MIT Technology Review Custom Report found that 35 percent of companies plan to create a shared finance and HR function within the next year.
This emerging trend makes a lot of sense. CFOs are being asked to take a more active role in defining business strategies, which requires a firm understanding of the company’s talent and resourcing needs. In turn, HR leaders need a clear view of each team’s budgets and strategic priorities if they are to recruit and retain the right people. And both lines of business need the ability to shift gears quickly to keep pace with digital disruption, new business models, and emerging technologies like robotics, AI and machine learning.
Finance and HR need to collaborate and innovate as much as possible. When they do, the research shows that they make better, faster, smarter decisions that drive improved business outcomes.
This is leading finance and HR teams to consider a unified system in the cloud. Cloud finance and HR systems—with their continuous updates and innovations, mobile accessibility from anywhere, and shareable dashboards and report—is driving improved collaboration between finance and HR teams.
Many companies run separate, disconnected HR and finance systems from multiple vendors. This not only leads to integration challenges, but to a lack of insight—each system has its own record of workforce-related costs, and the two don’t always reconcile.
There are at least 34 touch points where finance and HR interact; with this many unified processes, a unified cloud makes the most sense for efficiency, productivity and automation.
Let’s consider the case of bringing a new employee on board.
When you add a new employee, there are three actions that you must take: assign the new person to a manager, add a line of business/cost center, and define a role. A unified cloud system makes each of these steps quick and easy; there is no need to re-enter the data or wait for IT to map the data across systems.
A “single person record” defines an employee’s role, data access privileges, reporting hierarchy, and other characteristics, eliminating the need to create and maintain multiple sets of employee records. This global definition is shared by Oracle ERP Cloud and Oracle HCM Cloud—improving data integrity and control.
Another benefit of a unified finance and HR cloud is that it provides ongoing access to the latest technology innovations—whether those are adaptive intelligence, machine learning, blockchain, or another technology that’s only starting to emerge. Staying current is critical in attracting and keeping the best talent—especially among Millennials, who have grown up with the latest technology at their fingertips.
With no lengthy, on-premises upgrades and regular updates rolled out a few times a year, finance and HR teams can keep up with the pace of change. 90 percent of respondents in the MIT Technology Review Custom survey said their cloud initiatives have given them greater agility when dealing with market opportunities and challenges.
Human resources are often a company’s greatest expense, which means that finance takes a keen interest in issues like payroll and compensation. Conversely, HR wants to know what type of salary and benefits it can offer to new hires, and enact programs that will help them keep existing talent from fleeing to competitors.
All of this knowledge requires data analysis. A unified finance and HR cloud provides insight into workforce costs that can be sliced and diced down to the individual level. And the information is displayed in dashboards that finance and HR leaders can immediately access; there is no need for exporting, gathering, and reconciling data from two disparate systems.
Finance and HR leaders can get better insight right away. They can spend more of their time developing and planning strategies to get the right people—not only for today, but to meet future business needs.
A unified finance and HR cloud offers more than modern technology. It helps build the foundation for the unified finance and HR functions that more than a third of companies surveyed are planning to create. Finance and HR leaders can look to the digital future with modern mindsets—and business models that are flexible enough to see them through future changes.