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How do 'world-class' HR departments spend their money?

Those HR organizations in the top quartile in effectiveness and efficiency spend 25 percent less than the typical HR department listed in its peer group, and the best require 30 percent fewer staff.

By Katie Kuehner-Hebert | Updated on October 03, 2017
Leading HR departments are anteing up more dollars for “the new wave” of HR cloud-based applications and services. (Photo: Shutterstock)

“World-class” human resource departments are more efficient and effective than their peers — they may spend more on technology, but their overall costs are smaller in large part because they require fewer staff, and they tend to make less errors, according to The Hackett Group’s report, “Raising the World-Class Bar in HR Through Digital Transformation.”

Those HR organizations in the top quartile in effectiveness and efficiency, deemed “world-class” by Hackett, spend 25 percent less than the typical HR department listed in the report’s peer group, and the best require 30 percent fewer staff. A typical company with $10 billion in revenue could potentially save as much as $15 million annual if they were to attain “world-class performance.”

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Katie Kuehner-Hebert

Katie Kuehner-Hebert

Katie Kuehner-Hebert is a freelance writer based in Running Springs, Calif. She has more than three decades of journalism experience, with particular expertise in employee benefits and other human resource topics.

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