In the last two decades, there has been a significant shift in HR. Fifteen years ago, when you thought “human resources” you probably thought “W-2” or “401K”. Now, HR encompasses so much more, and it is often referred to as human capital management[i]. Implementing a human capital management strategy can benefit businesses in several ways, allowing for more organization and simplicity of HCM operations.
What is strategic human capital management?
Strategic human capital management (HCM) is a people-focused approach to HR that unites a variety of human resource processes to work as one—from recruiting and onboarding, to payroll and benefits, to workforce and performance management. With the right human capital management strategies, you can benefit from more efficient and cost-effective employee management processes.
The key to strategic HCM is treating your employees like an investment. To do that, you must take into account all parts of the employee life-cycle, from recruitment to retirement. Without taking these into consideration, your human capital management strategies will never be as effective as they otherwise could be.
Important Components of Human Capital Management Strategies
Human capital management strategies combine integrated technology and streamlined HR processes in the following areas:
- Recruiting and Applicant Tracking
- HR Management
- Benefits Administration
- Performance & Talent Management
- Time & Labor
The Value of Implementing Strategic Human Capital Management
- Differentiate your business. In this increasingly global economy, your organization must find ways to set itself apart from its competition. One big differentiator is how you manage your people—the core of your business.
- Optimize your workforce. It’s vital to create efficiencies, keep your employees happy, and reduce turnover And less turnover means increased productivity—giving your company the competitive edge it needs to stand out.
- Connect disjointed practices. Strategic HCM combines point solutions and processes (like payroll, time and attendance, and recruiting and onboarding) to give you one streamlined approach to HR. While best of breed systems can deliver positive outcomes, they’re disconnected from the overall operation. What use is a job application if that data doesn’t populate into your onboarding system after a worker is hired? How can you use time and attendance data if it doesn’t seamlessly flow into your payroll system?
- Cut Costs. A recent study conducted by HR.com shows that the most common benefits of integrated human capital management are better access to information and reduced administrative costs.
- Maximize productivity. By linking all functions of HR, you can eliminate redundancies and duplicate work For example, pulling information from an employee’s job application into your onboarding system means you only have to enter information once.. Additionally, feeding time and attendance information directly into your payroll system can ensure employees get paid correctly the first time, every time.
- Enhance employee work life. A human capital management strategy that utilizes integrated human capital management technology can also enhance employee work life—and not just the employees working in HR. An integrated strategic HCM solution not only helps ease HR processes, but it offers a consistent experience for all employees to: apply for jobs, get on the payroll, enroll in benefits, log hours, request PTO and review performance.
- Speed hiring and onboarding process. With a faster, more efficient process new hires feel more engaged. Plus, with an employee self service platform with an easy-to-use interface it puts control in employees’ hands and enhances overall satisfaction.
- Prioritize Training. Training is essential to employee retention, and with the right plan and tools, you can minimize the time it takes to get a new hire up and running.
- Improve visibility. One major benefit of strategic human capital management is the visibility you gain into your workforce and business’ operations [i]. Strategic HCM can show patterns and holes in your employees’ skill set, learning and productivity. It also can reveal the impact of your recruiting efforts and other strategic objectives. Access into your workforce trends can help you anticipate changes and respond proactively.
The Importance of Strategic HCM
Human resources has come a long way. It now encompasses a full human capital management strategy—centered around your company’s biggest investment—your employees. Both a technology and a mindset, strategic human capital management helps you manage and develop your workforce throughout the employee lifecycle.
Optimizing Your Business with Strategic Human Capital Management
Still, strategic human capital management is not simply a tool to help with the growth of an individual employee. It can also help optimize your company’s culture, departmental processes, and organizational performance. If your company is looking to enhance its approach to human resources, retain talent, and increase productivity, implementing a strategic human capital management plan is the answer.
Experience the Benefits of Professional Human Capital Management Strategies
At EPAY, we understand the challenges of people management, especially when dealing with the complexities of an hourly workforce. That’s why our number 1 priority is to make your life easier. Our services, complete with easy-to-use cloud software and 24/7 customer support, manage everything for you. And when it comes to pricing for human capital management strategies, there are no surprises. You pay one straight-forward, all-inclusive monthly price. Request a demo to learn more.