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Growing HR Budgets
May 06, 2008
Average Expenditure for HR to Grow 7 Percent in Next 12 Months, According to Study
A new national study conducted by the Gantry Group reveals that a company's annual budget for HR/Workforce Management solutions and services, on average, will grow to $1.14 million in the next 12 months.
The study, titled HR/Workforce Management Solutions, Expenditures, Trends, reports that companies will allocate their budgets to these areas: 13 percent to recruitment, 11 percent to leadership development, 12 percent to performance management, 10 percent to compensation planning, and 9 percent to talent management.
The study solicited feedback from C-level HR executives and vice presidents (28 percent), HR directors (32 percent) and HR managers (24 percent). Over two-thirds (67 percent) of study respondents were with companies with over 1,000 employees, and 34 percent were with companies with over 10,000 employees.
The study revealed the following additional findings:
• The key metrics that companies use to determine the success of their HR solutions is reduced administrative burden on HR staff (45 percent), followed by improved HR productivity (39 percent), and lower operational costs (37 percent).
• The majority of respondents believe that their HR solution deployments have benefited their organizations through reduced HR time expended on benefits enrollment and administration (61 percent), and reduced time allocated to payroll processing (49 percent).
• Respondents are least satisfied with their deployed solutions for Talent Management, Performance Management and Manager Self-Service.
• Dissatisfaction with HR solutions arises primarily from vendors' poor response to problems (46 percent), poor integration with the company's infrastructure (41 percent), poor performance (38 percent), and an increase in HR process complexity (36 percent).
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