The way the corporate sector defines insanity and deals with the consequences is largely different from that of human resources’ definition. Both finance and human resources define ‘insanity’ as repetition of the same task in a professional environment and expecting different outcomes. However, the manner in which these two departments deal with ‘insanity’ as a challenge for organizational growth is what makes the difference. While the focus of the HR department in handling the obstacles caused by insanity is improving the leadership programs, finance focuses on the negative impact that insanity has over organizational outcomes, judged mainly from a monetary perspective.
Setting up the business goals is greatly affected due to insanity in an organization. The finance department provides a projection of the business goals at the beginning of a financial year. While leadership plays the role in motivating and driving employees to achieve the projected goals, the finance department, prior to delivering their estimation, takes into account all factors that could have constructed a situation amounting to insanity. At the same time, the department provides recommendations for the necessary measures that can handle the situation, in case the insanity obstruction has truly occurred.
The finance department, while preparing the annual business target, focuses on the following factors:
- The long term objective of the organization
- Creating well documented business plans with strict consideration of the present economic situation
- The estimated financial allotment for different components that the yearly business goal should contain
The finance department’s determination of insanity is of extreme importance from the perspective of seamlessly running business operations towards attaining the goal of organizational fulfillment. Without their participation in solving the problem, it will not be possible to segment the business goal as per the roles and responsibilities of different organizational units. What this means is the necessity for communication between different organizational departments, such as, sales, production, public relations, human resources, etc., is paramount. Lack of communication among these departments doesn’t allow employees to complement their respective duties in achieving the goal. The ultimate result falls far from expectation.
The finance department’s effort in setting up business goals successfully, on the other hand, changes the whole game. It not only widens the path for communication among departments, but also employees receive a better understanding about their contribution in ensuring the organizational objective. This realization has a very important role to play in motivating employees and urges them to put forward their 100% in guaranteeing the projected business goal.
The finance department’s identification of insanity is a matter of fundamental importance for businesses. The sooner the identification is done, the quicker it becomes the goal setting process. Goal setting not only quickens the rolling out of business operations, but also holds employees accountable for their duties towards their company. Furthermore, with setting up of the goal, businesses also receive the opportunity to determine their product planning, promotional strategies, and ultimately stay ahead of competitors.
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( Article's Source: https://payrollservicesfl.wordpress.com/2015/01/03/finances-definition-of-insanity/ )
