Nonprofit HR’s Blog

Sitting in my seat as COO/CFO of a $25 million dollar, 160 person organization, I have the opportunity to witness how the Human Resources and Finance functions, working together, can improve many of the organization’s outcomes. There’s little doubt in my mind that Finance and Human Resources are necessary organizational support functions. Organizations require both labor and capital for success. Yet the struggle for power and/or control along with personal agendas can impact many organizations and the individuals that work in them. Generally speaking, finance focuses on the dollars and cents while human resources wrestles with an equally important side of business — people. Human resources may not be aware of the cost implications of a program, and finance may not understand the impact to staff. Though finance and human resources staff are often from different backgrounds and may have different skill sets, they should value each other’s differences and skill sets, because the combination of our differences and skill sets can be powerful.

I’ve found the following to be helpful in bridging the gap — 1) each function should arrange periodic meetings to discuss current issues each is facing; 2) finance can educate human resources on the accounting basics; 3) human resources can educate finance on staff considerations such as compensation, benefits, and staff engagement; and 4) human resources and finance should invite the other function to periodic planning meetings. These four strategies can help forge closer ties between finance and human resources. From these exchanges, human resources and finance can build mutual respect and lessen the competition between the functions as well as learn to speak the same language. Also, as COO/CFO, I must ensure that I don’t play favorites and get into a situation where the leaders of these functions are competing for my attention. Organization success depends on true collaboration between finance and human resources.

Ernest Duncan is the Chief Financial Officer/Chief Operating Officer of the Vera Institute of Justice. His session Clash of the Titans: HR vs. Finance is scheduled for Tuesday, October 9 at 2:15 p.m. at the 2012 Nonprofit Human Resources Conference. Twitter: @bluprint4life