HCM 101: What Is Human Capital Management?

Employees are the most important assets of any business. And while your people are your most valuable assets, managing your employees shouldn’t have you bogged down with tedious paperwork and recordkeeping.  HCM gives you back your time by taking a practical and intuitive approach to HR.

HCM technology allows organizations to redesign work structures and improve work processes, improving the employee experience and freeing you to focus on strategy and the people, rather than the spreadsheets.

HR has an increasingly important role to play in most businesses. In some organizations, 50% of revenue is spent on salaries, and your payroll team plays a significant role in properly allocating wages and payroll taxes.

Payroll is one of the most important aspects of human capital management. From automated payroll processing to digitized time management, there are various benefits that payroll departments can glean from implementing an HCM solution. 

Whether you’re an HR professional looking to improve how you do your job or you’re the manager of a small business, keep reading to learn how HCM can streamline your employment practices and bring added value to your greatest assets.

What Is Human Capital Management?

HCM is a set of practices that businesses use to find, manage, and train employees. While HCM can look totally different in various environments, there are some key ideas that HCM follows, including:

• Flexibility: HCM is not a set of rules but a set of practices that constantly evolves.
• Personalized: The HCM product that you use for your business should be capable of meeting your specific needs.
• Growth: Technology is constantly changing, and HCM is expected to change along with it.
• Multiple solutions: Although they are all grouped under HCM, how one software package attempts to solve an organization’s problem may be totally different from another software package’s solution.

How Does HCM Help With Benefits, Hiring, and Training?

Hiring and retaining great talent has never been more challenging. HCM software helps keep your recruiting process and benefits administration moving smoothly and efficiently. 

• Talent acquisition — HCM software revolutionizes how companies hire new talent. With updated recruiting and applicant tracking, businesses can easily find top talent, automate the recruiting process, and improve hiring efficiency so employees can begin contributing ASAP.
• Benefits — Increasingly, benefits are a top draw when attempting to recruit the best talent. HCM software helps find the best benefits for your organization and simplifies enrollment and benefits selection through streamlined benefits administration.
• Training — HCM software is focused on performance management and makes it easier for employees to track their personal goals, participate in training and development in areas of interest, and communicate with their managers. From a management standpoint, you are better able to disseminate key pieces of training and track the progress of your employees.

How Does HCM Impact Payroll?

For organizations looking to streamline their payroll process, HCM software is the answer. You don’t have to be chained to spreadsheets, paperwork, and the fear of missing deadlines — with HCM software, you can capture key payroll data, set predefined payroll dates, automate direct deposit delivery, and so much more.

The result? Rather than spending your precious hours on time-consuming tasks related to payroll, you’re able to focus on business-growth initiatives that make a positive impact on your bottom line. Here are some of the ways that using HCM software impacts payroll:

• Automation — HCM software can automate the payroll process to decrease human error, avoid violations, and increase efficiency. The payroll software ensures that the proper taxes are taken out, that payroll is synched with employee promotions, and that employee hours are tabulated accurately.
• Monitor working hours — Timesheets are messy and can lead to payroll errors. HCM software keeps track of your employees’ hours automatically so that you have a single source of data collection.

How HCM Solutions Improve Organizational Efficiency

Businesses, large or small, have redundancies and inefficiencies they may not even be aware of. HCM software helps organizations improve their organizational efficiency.

• Onboarding efficiency — Employee retention starts from the first day, and HCM software makes onboarding faster and more efficient. Filling out paperwork is faster and more engaging, documentation is signed and accounted for, and the new hire already feels connected to your company.
• Displays data more efficiently — A recent study showed that 19% of an employee’s time is spent searching for data. With personalized online portals, HCM software interactively presents data using charts and graphs, so employees spend less time searching for data and more time on their core competencies.
• Organizational efficiency — To operate as efficiently as possible, organizations must have processes and strategies in place to manage their human capital — HCM enables organizations to have processes that improve efficiency and, thus, organizational success.

Conclusion

HCM software eliminates many of the everyday worries your HR and payroll department is facing. HR departments will be expected to carry a heavier load in the future, and HCM software helps to automate their most time-intensive, repetitive tasks so they can focus on more strategic efforts — like hiring great talent — to help keep your company thriving.

HCM software will revolutionize your business and maximize the efficiency of onboarding, payroll, training, and more. Your competitors are already using HCM software to empower their decisions — now it’s time to join the revolution so you can get the most out of your most valuable resource. Get started today!