HR pros report increased pressure to justify program spend

About 45% of HR professionals reported an increased pressure to justify their program spend in recent survey. And only 27% said their C-suite recognizes HR’s positive effects on business revenue, according to a Dec. 5 report from people management software Lattice.

In addition, only 48% of respondents said their C-suite leaders take data from employee surveys seriously, and just half said their C-suites recognize that a positive culture leads directly to better business outcomes.

“Successful people teams and leaders are increasingly those who go beyond just taking a seat at the table to demonstrate the strategic potential of the function, implementing programs that move the needle for employees and drive business results,” Cara Brennan Allamano, chief people officer at Lattice, said in a statement

“This year’s State of People Strategy Report reveals a missing link for some HR teams in demonstrating those business outcomes,” she said. 

In a survey of more than 1,000 HR leaders from companies worldwide, performance and engagement tied as HR’s top priorities for 2024. Although employee engagement topped the list for a third year, it tied with performance management, which had a 40% increase from last year’s survey.

Despite a challenging year, many HR teams reported a positive outlook for the future. About 64% said they felt engaged, and 65% felt confident about their job security. In terms of resources, 79% said their budgets would remain the same or increase, and 86% reported a flat or increasing headcount. In addition, 76% are proactively looking for ways to incorporate AI solutions into their HR workflow.

Based on the survey, Lattice noted several factors that seemed more common among high-performing HR teams, or those that reported exceeding their goals. For instance, about 82% of high-performing teams said they felt confident about connecting their work to business outcomes, and 62% said their C-suite recognizes the effects of a positive workplace culture. High-performing teams were also more likely to put more effort into diversity, equity and inclusion programming and policies.

As the role of HR continues to change, the disconnect between the C-suite leaders and HR teams could continue to grow. While 92% of C-suite executives said the perceived value of HR remains a challenge for HR pros, according to a recent survey from HR tech company Sage, 91% of HR leaders said they’re excited about the future of their profession. 

In fact, the HR profession may be entering a new era in the next year with a focus on priorities such as engagement, performance and budgets. Looking ahead, HR teams are looking for new ways to implement DEI efforts, improve retention and demonstrate value to leadership, experts told HR Dive.

People data and storytelling, for instance, can help HR to demonstrate its positive contribution to the bottom line. Company videos, social media posts and data visualizations can add valuable context to human capital disclosures or ESG reports.