The headcount in the organization is the first thing to review, when the recession comes. Good HRM Function has a lot of historical data and has time to prepare the internal headcount (FTE) analysis and to have a broader discussion of the FTE development in the HRM Management Team. The recession makes the FTE development discussions a priority for the whole organization.
The headcount is one of the main drivers for the personnel costs. The HRM Function cannot decrease base salaries; the only really significant driver for the decrease of personnel costs is the number of employees in the organization.
The HRM Function has to have the analysis of the FTE development in the organization and the HRM Function has to be able to provide the evidence to any headcount addition in the organization.
The FTE allocation is also very important. The number of employees can be fine on the company level, but many organizations do not have the correct split among different units. The HRM Function should be able to provide the benchmarking of FTEs in the organization.
The HRM Function has to be sure about its power in the recession. The HRM Function has to be able to provide the business leaders with a lot of different HRM Benchmarks. The HRM Function is able to compare different units among each other and the HRM Function has to have the courage to present the results in the front of the top management.
The headcount is a really difficult topic to tackle in the recession. The recession is very difficult time for the organization, but the HRM Function is the real facilitator for the top management and the HRM Function has to provide the organization with the right and best solution for the FTE management.
