Integrated human capital management (HCM) systems are becoming increasingly common as organizations upgrade their HR technology infrastructure. To help organizations make the right technology decisions, HR.com and EPAY Systems have done a study on the impact of integrated HCM technology. The report shares insights from HR professionals in large organizations—many of which work for companies that employ a significant number of hourly workers.
A New Focus: Integrated Human Capital Management Technology
The reason organizations with a large hourly workforce are beginning to focus on integrated HCM systems is the high cost of managing this workforce, in particular the cost of recruiting, onboarding, and background screening. When these processes are automated and integrated, the cost savings are significant and highly visible.
It is easy to underestimate the challenges of recruiting blue collar roles, however even for simple service jobs, getting the right talent is challenging due to high demand and competitive wages. While talent management systems originally focused on salaried employees, companies are beginning to see the importance of these systems for the hourly workforce.
And while cost savings are one of the most noticeable benefits of integrating HCM technology, another clear benefit is that of increased overall efficiency and quality. With the right people working for your business with the help of recruiting through human capital management technology systems, your company will have better employees and will subsequently function more effectively.
Defining Integrated Human Capital Management Technology
Integrated HCM refers to a single system from one vendor that handles a wide range of HR processes (e.g. HR, payroll, talent management, workforce management, and so on). This stands in contrast to having separate software from several vendors for different HR processes.
The advantage of using integrated HCM technology is that, ideally, information flows seamlessly between the different modules, and data only needs to be entered once. In fact, the need for information flow is so important that companies that buy a number of separate systems for different parts of HR usually invest in integrating them.
Often times, vendors use the term “integration” loosely. At its best, an integrated system has a single database across all modules. At its worst, a so-called integrated system is just a loosely connected group of stand-alone modules that were assembled by the vendor from other HR software companies it acquired.
While it’s not essential to have perfect integration, HR needs to recognize that the degree of integration can vary enormously between vendors, even if they all make similar promises about their integrated system. This is why it’s necessary to do your research when looking for the right vendor, based on how they define integration of human capital management technologies and the overall extent of their services. If you don’t trust a vendor to provide you with everything you’re looking for with HCM technology, it may be best to look elsewhere.
Key Findings of the Integrated Human Capital Management Study
The study revealed a number of clear findings on the degree of satisfaction with integrated HCM systems and which factors contributed most to that satisfaction:
- Two-thirds of companies are satisfied or very satisfied with their integrated HCM.
- The most common benefits for employees were better access to information and that the system was more convenient to use.
- Time and Attendance, Onboarding and Learning Management are the least integrated HCM modules. Recruitment and Learning were the HCM modules companies most often wish they had integrated. (Note that these modules are particularly relevant to hourly workforces given the need to recruit candidates often, track their hours, and acclimate the steady flow of new employees).
- 85% of organizations report an integrated HCM system led to easier access to employee data and 75% benefit from increased employee data accuracy.
- 38% of organizations identified reduced administrative cost as the main source of ROI. (Note that administrative cost is typically a bigger issue for the hourly workforce than the salaried workforce due to higher turnover.)
Read the Full Report on Human Capital Management Technology
The full report expands on these findings and draws out the lessons for ensuring your company reaps the benefits and avoids the pitfalls of implementing an integrated human capital management system. You’ll be able to see all of the details included in the study regarding human capital management technology and its impact on businesses. You’ll ultimately find that with the help of these systems, workforce management is easier than ever.
Want to read more? Get the full HCM technology report: The Impact of Integrated Human Capital Management Technology for Employers with Hourly Workforces.