Short-Termism and Culture Clashes Biggest Barriers to Collaboration Between HR and Finance Teams: Oracle Study

15th February 2019 | By Mouseworld Now Correspondent |

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Redwood Shores, CA, Feb 14, 2019:   A short-term mindset and entrenched cultural habits are the biggest barriers to collaboration between HR and finance teams reveals a new study commissioned by Oracle. Covering 1,510 HR, finance and business professionals, the Study found that in order to successfully unlock the value from data and help their organizations adapt to the changing nature of the global talent market, HR teams need to rethink analytics technology, skills and processes to improve collaboration with finance and drive a competitive advantage.

“HR and finance departments bring different, yet complementary skills to the table. While they traditionally have not worked together closely, that needs to change in order for organizations to create a competitive advantage in today’s evolving market and talent economy,” affirmed Donald Anderson, Director, Organization & Talent Development, Oracle.

“The first step to overcoming traditional barriers and bringing HR and finance teams together is having a collaborative mindset with the right skillsets to both gather and analyze data so that it can be used to make impactful business decisions. That alone will deliver significant benefits to an organization’s performance,” Anderson further added.

 

Sitting on Piles of Data is NOT the Same as Being Able to Use it Effectively

With the global talent market turning sharply competitive with the rise of new technologies, the costs of recruitment have soared and the demand for new skills have increased by leaps and bounds. To be successful in this rapidly changing market, HR teams need to rethink their approach to analytics, skills and collaboration to drive a competitive advantage.

The Oracle Study found that  95 percent of HR and finance professionals plan to make data-driven collaboration a priority in 2019. To effectively act on data, HR and finance teams need to acquire new skills. But the survey found that 49 percent participants cannot currently use analytics to forecast outcomes and 81 percent were unable to determine future actions based on predictive data.

 

It’s Not About More Technology, it’s About You

While data and analytics have proliferated HR and finance, the benefits are limited without effective collaboration and the ability to derive value. In order to reap the rewards, both departments must overcome short-termism, break through culture clashes and shrink the skillset gap.

As per the findings of the study, the biggest barrier to collaboration between HR and finance is a short-term mindset. Nearly 71 percent participants said their teams focus on quarters rather than future strategic direction.

Culture clashes between departments was another top challenge with nearly a third (29 percent) ranking traditionally separate habits as the biggest barrier. Other barriers included mismatched skillsets (27 percentage) and organizational silos (17 percentage).

HR teams were also found to lack the skills to act on data and solve issues (70 percent), cultivate quantitative analysis and reasoning (67 percent) and use analytics to forecast workforce needs (55 percent).

 

HR and Finance Leaders Need One View of the Truth:

The majority (80 percent) of organizations believe HR and finance teams are already helping them make better data-driven decisions. But, their teams will need to acquire new skills, but with an increased focus on collaboration, organizations will be able to gain even bigger business benefits.

THe study further revealed that 88 percent of respondents believe HR and finance collaboration will improve business performance, while 76 percent believe it will enhance organization agility. Over half (57 percent) of organizations plan to achieve more holistic, enterprise-wide insight through collaboration and 52 percent of HR and finance professionals believe it will help them become more strategic partners.

AI to Pave the Way to Greater Collaboration and Better Business Results

HR and finance professionals are looking to emerging technologies like artificial intelligence (AI) to help drive business results: While a quarter (25 percent) of survey respondents are primarily using AI to identify at-risk talent and model their talent pipeline (22 percent), they are rarely using AI to forecast performance (18 percent) or find top talent (15 percent).

According to the study, over the next year, 71 percent of survey respondents plan to use AI to predict high performing candidates in recruitment and source best-fit candidates with resume analysis (70 percent).  Other AI priorities for survey respondents include modeling their talent pipeline (58 percent), flagging at-risk employees through attrition modeling (52 percent) and supporting employee interactions with chatbots (38 percent).

“The world of analytics and AI opens tremendous doors for HR to harness meaningful insights in order to make smarter decisions and create a talent advantage,” said Tom Davenport, Babson professor and analytics expert. “Seeing that so many HR professionals are planning to invest heavily in AI over the next year is promising. It means we’ll begin to see more strategic results and businesses competing on an entirely new level to find the right talent.”

This survey interviewed 1,510 HR, finance and business professionals in late 2018. Cutting across industry verticals and geographies, the professionals hailed from companies with US$100 million of revenues or larger.

 

 

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