Expert Advice for Medium and Midsize Businesses

How Finance and HR Together Helps Support Your Growth

Guest Author

By David Werner, Director, Cloud Business Group, Oracle

Here at Oracle, we work with a lot of fast-growing businesses. Often, these companies are growing so fast that they can barely keep up with customer demand. This is a great problem to have—but it often leaves leaders scrambling to hire and onboard the right talent in a hurry.

If you want to effectively manage this growth, you need to start thinking about scaling your HR and finance systems to keep up. Let me explain.

When a company is first setting up shop, it might have an HR department of one—or the owner might even be doing all the hiring. The process is typically done through a hodge-podge of online job boards, email, Word documents and government forms. Payroll and income tax deductions are managed using whatever financial software the company started out with (typically Quickbooks or Sage).

But as your company grows and adds more employees, these processes can’t scale to keep up. You need to start thinking about expanded employee benefits such as health plans, retirement funds, and competitive salaries. You need to track employee expenses and reimburse your staff for business-related travel. You can’t keep doing all of this manually, unless you want to hire yet more staff.  

It’s at this point that many small and medium businesses start looking for HR software to help automate the process. But since employees are your biggest expense—and they won’t work without getting paid—your HR application needs to work hand-in-glove with your finance software.

To do this, we recommend something known as a “single data model” across HR and finance. It provides a shared architecture and master data across both lines of business.

How does this help? Well, let’s consider the case of bringing a new employee on board.

The Magic of a Single Data Model

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.

When you add a new employee, there are some key actions that you must take: define the new person’s role, assign them to a manager, and add the new hire to a line of business or cost center. The single, shared data model makes each of these steps quick and easy; there is no need to re-enter the data from one system into another, or wait for your IT team (assuming you have one) to map the data across cloud applications.

Once your new employee is set up, the system can automatically determine approval workflows for things like expense reports or purchase requisitions. The shared security model also determines what line of business, cost center, or department the new hire has access to, ensuring that the person can only access information and functions that are relevant to their role.

Increased Levels of Automation

Another benefit of a single data model is seen with approval processing.  As the company continues to grow, employees might change jobs or get promoted. When this happens, the system knows exactly where that person resides in the organization. Approvals and workflows can follow them automatically—for example, migrating expense approvals to the person’s new manager.

The beauty of a single data model is that you start with a single person data record, with everything you need for both finance and HR to run seamlessly. This reduces the burden of administrative tasks on your growing business, helping you to do more with the same number of people.

So now that you understand more about what makes the Oracle Cloud unique, let’s walk through how you can more easily manage a few finance and HR business processes. There are dozens of touch points where HR and finance systems interact; let’s look at just a few examples:

  • A finance director is promoted to the CFO chair. It's important from day one that the new CFO has access to dashboards that cover the entire operation. With a single person data record and security model, access to C-level dashboards can be granted immediately. At the same time, the CFO’s replacement automatically gets access to appropriate dashboards and approval privileges that reflect their new role.
  • The CFO issues a new directive: all hires in a certain category—say, for contingent labor—are now subject to C-level approval. If HR and finance are in sync, the policy is immediately reflected in all the appropriate workflows without the need for human intervention.
  • Your company decides to hire more sales personnel to push an innovative new product. New sales departments, cost centers and budgets can be created and approved quickly and efficiently.
  • You’re in the middle of negotiating a lucrative new contract to resell your products under a major brand name—and your key contract specialist quits to take a new job. You can quickly move someone else into the role. Up-to-date finance and HR records allow review and approval workflows to be routed to the new person right away, without a hitch.
  • Your new CFO does an analysis of company expenditures, and discovers that travel costs are way over budget. Rules for the new travel policy—one that requires video conferencing first, or travel justification and management approval second—can be implemented across finance and HR systems, seamlessly.

These (and many other) touchpoints can be automated in a single, shared data model between Oracle ERP Cloud and Oracle HCM Cloud.

With higher levels of automation, your staff can spend less time on pushing around HR and finance paperwork, and more time on recruiting the best talent to support your growth. You can expand your workforce quickly to keep up with rising demand, without a lot of manual work, procedural headaches, and data re-entry from one system into another.

That’s something that any leader of a growing business can get behind.

For more information, read the whitepaper 5 Benefits of Having ERP and HCM in a Single Cloud Platform.

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