With everything on your plate at year-end, it can be overwhelming to think about planning and budgeting for the next one. But taking a little time to consider these matters before December 31 can save you headaches down the road.
Here are some best practices to keep in mind as you start building your 2018 strategic plan and budget.
1. Look to the past before looking ahead
All the time spent in Q4 measuring progress toward sales goals and calculating employees’ holiday bonuses doesn’t occur in a vacuum – the knowledge and insights you gain from year-end tasks can be lessons for the new year. Review the past 12 months to see what worked and what didn’t. Maybe you had low engagement with open enrollment this year, or your recruiting efforts weren’t as successful as you wanted them to be. Use this insight to help guide your 2018 objectives and budget needs
2. Identify opportunities for professional development
While evaluating your talent needs for the new year, also take stock of current employees who are primed to advance. Perhaps one of your star performers has exhibited promising leadership qualities, expressed a desire to move to a new department or wants to pursue additional education or professional certification. Make note of these opportunities for career development and plan to follow through with them in the new year. Proactive professional development is essential to employee job satisfaction and retention, and we all know how challenging it can be to retain top performers.
Before you can establish your budget, you need to determine how many new hires you will need – and where. Leverage the data and analytics capabilities of your HR system along with manager input to identify personnel and skill gaps within the current workforce. Start building a plan on how to achieve your hiring goals and be sure to account for costs other than salary (i.e., flying in remote candidates for interviews).
4. Get clear on your budget
An annual budget is often unstructured and vague, which makes it harder for your company to spend its resources on what matters most. It pays to flesh out the framework of your budget ahead of time. Make sure all stakeholders are on the same page about what structure the budget will take. The Society for Human Resource Management notes that budgets usually fall into one of two categories: incremental or zero-based. Incremental budgets use the current year’s budget as a template with each item adjusted based on future estimates. Zero-based budgets, on the other hand, are built from scratch, with each item having to earn its place. Reach a consensus on which type of budget is ideal, then move forward. Cold hard facts should win out in your budget over hopeful wishes, so use HR, payroll, benefits and talent data collected through your HR solution to prioritize your spending.
For more tips, download our Step-by-Step HR Planning Guide.
Is a new HR system in your 2019 plan and budget? After the dust has settled from Year-End, give us a call and let us show you how we are different than other providers.