From the course: Human Resources: Leadership and Strategic Impact

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Strategic HR budget

Strategic HR budget

From the course: Human Resources: Leadership and Strategic Impact

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Strategic HR budget

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- If you want to make strategic HR investments, it might seem logical to start with the HR budget. Many leaders carefully analyze how HR spends money and the cost of HR programs with questions like, how many programs and activities does HR deliver for every dollar spent? Or, how can HR deliver more programs to more employees at the same cost? It's often possible to save thousands of dollars with lower cost HR programs. In fact, most organizations probably spend too little on pivotal talent because they fixate on budget cuts. But don't confuse an HR budget with an HR strategy. Saving money on less expensive HR programs may be short-sighted if they reduce the quality of talent with the greatest impact. Spending more money on HR programs is prudent if the extra cost produces greater strategic payoff. It's just like strategic investments of money and technology. A strategic HR budget spends more where they payoff is higher, and less where the payoff is less. You can create a more…

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