HR is burdened with cost control issues

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In three-quarters of UK companies, budget for staff is spread widely across many different departments making cost control a daily burden for heads of HR, says new research investigating human capital management control in Britain's biggest companies.

Companies are failing to control employment costs, according to the Professional Staff Solutions research which found that poor recruitment processes, complex costing and payroll models added to poor management visibility of resource planning leak millions of pounds a year in direct and indirect costs.

200 interviews with HR and procurement heads revealed that many companies simply have no idea of the total size of their workforce and a quarter of procurement heads admit that they do not liase with the HR department regarding the hiring of non-permanent workers.

The research also found that heads of HR do not have a clear view of how contract and permanent staff interact, suggesting deeper discontinuity of control.

"Companies do need the flexibility for local autonomy in how staff are hired and paid for but managing this flexibility opens organisations to very high costs and poor quality control," said Tony Borrill, Managing Director of Professional Staff Solutions.

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