When you optimize your HR staff, you are optimizing your entire employee base.
At many midsized companies, human resources is mired in administrative functions such as payroll, benefits, and compliance. But other companies see the value in elevating HR into a true strategic management partner, equipped to optimize the company’s most valuable asset: its employees. That’s the promise of workforce or human capital management (HCM), an integrated system that can address many of the daily bureaucratic needs of an HR department while also providing a foundation on which workforce training and development programs can be built. Until recently, deploying an HCM system entailed a large investment of time, money, and specialized skills. But that’s changing fast. Here’s what you need to know.
What is HCM?
A human capital management system handles the day-to-day activities of the HR department, including payroll and benefits, time and attendance, recruiting, performance management, and more. But what sets it apart from traditional applications is that it can integrate and synthesize this data into an overall picture of the workforce so managers can see where to allocate resources for the future.
“Workforce management is about analyzing your employee information from a strategic standpoint, as opposed to just entering data,” explains Christine Germanson, executive vice president of human resources administration at Regions. “It gives an employer the ability to look at talent management from a succession-planning or performance point of view, so you can see where there might be training or development needs based on a holistic view of the workforce.”
Planning Your HCM Deployment
Germanson’s team deployed a new HCM system in January 2015 using a three-step approach:
- Evaluate your current system. The first area to consider is your current system and the limitations it may impose on your managers, associates, and Human Resources. Look particularly at how information is made available to those who need it. During this review, Germanson’s team determined, for example, that managers who wanted to access their employees’ performance and compensation data had to request it from another department, which cost time and resources. “We wanted our managers to be able to make decisions quickly and more efficiently, so it was important for our managers to be able to view the data real time,” she says.
- Assess your needs. Once you’ve identified the gaps in your current HR systems, you can prioritize what to look for in a new one. For Germanson, one of the great benefits of modern human capital management systems is the transparency and efficiency they offer managers and employees. “We were looking for a really good business-effectiveness tool for our managers, associates, and human resources that would offer insight on our workforce, she says. Newer systems offer individual dashboards for employees and managers providing information about their paychecks, benefits, team information, time/attendance, talent, and performance, as well as a number of self-service options. Additionally, HCM systems can accommodate multiple state and federal regulatory requirements so that your company remains in compliance. And finally, Germanson was looking for a system that would ensure that business processes remain consistent throughout the organization.
- Communicate the value of the change. Germanson found that one challenge in implementing a new HCM system was making sure there was widespread buy-in for the changeover. “It’s easy to underestimate the change-management side of things,” she notes. Her recommendation: communicate the reasons for the change early and often, and make clear the benefits it will provide. “It’s about letting people know where we are and where we’re headed and getting everybody enthusiastic about the goal,” she says.
Because many technology vendors now offer HCM solutions in a cloud-based subscription model, costs have fallen. Shop carefully, of course. But explore your options. You may be very happy with what’s available. Enabling you HR staff to focus on how to bring out the best in each employee is a goal well worth pursuing.