Nonrevenue Generating Departments

As a business leader, you need to have a sense of what departments are important for your company and why they matter. For some companies, however, this isn’t the case. There is one department that continually struggles to find its place in the organization and it’s their marketing team.

The reason for this struggle comes down to two things -- how different people use online media and services to communicate and spread messages about your company, and how different individuals in other departments don’t seem to fully understand the importance of marketing to the company as a whole.

As a manager, there are times when you will come across someone in another department who seems incapable of doing his or her job. You may even get permission to take action by proving the consequences of not performing those tasks correctly, but you still feel like you can’t.

This internal resistance usually stems from either lack of understanding of the effects of poor performance or simply a personal bias against the person working on these projects.

It’s very easy to fall into ruts with bad habits and processes, so try to be aware of them and work hard to break out of them if you want to see change at your workplace.

Human resources

non revenue generating department

As mentioned earlier, human resources (HR) is an important department that most business have either need of or at least use to some degree. This should be noted as it can save your company money in the long run by finding out what services you are paying for that you don’t actually need.

Many companies make large annual payments for things such as employee benefits like health insurance and retirement plans. Some even pay extra fees for employment laws and OSHA regulations!

These overhead costs add up quickly over time if you do not take action to reduce them. Luckily, there are ways to cut back on how much HR expenses are without doing any harm to your organization.

Some of these tips will cost you nothing but others may require more investment. What matters is that you look into every option before making choices that will help you save money while keeping people informed and satisfied.

Frequently asked questions

What is the non-revenue generating department? It’s an internal or external group that doesn’t bring in money for your organization. This can be a team, a position, or both!

Most organizations have what we call a “support services department.” These are groups like marketing, finance, human resources, communications, and more. They help other departments do their jobs by offering consulting, coaching, training, and/or tools and systems to make them more efficient.

By having these support service teams, you give other departments someone they can go to for answers or assistance. In fact, they may even use those services themselves!

But here’s the thing about a non-revenue generating department (NRAG) – even though it may not make direct revenue for your business, it still has a cost. That cost includes time spent doing work for the rest of the organization, costs associated with hiring people to do that work, and loss of productivity while they spend time working on NRRG activities.

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