Human Capital Management (HCM)
What is Human Capital Management?
Human Capital Management (HCM) is a set of human resource management practices. They are focusing on organizational needs to provide specific competencies and outcomes in three categories: workforce acquisition, managing and optimization. These sets of practices allow companies to manage their business and themselves more effectively.
The success of HCM depends on how effectively these three collective practices are executed. Which, in many cases, requires a software application to be implemented in tandem with management. The software will provide businesses with a variety of tools that can be used for employee acquisition, management and optimization.
Why is Human Capital Management important?
Human capital management is essential as it allows corporations to handle their operations more efficiently and effectively. From small to large to governmental agencies utilize an HCM system. One of the most critical advantages that an organization can obtain with the HCM program is the retention of workers. The HCM program will provide a human resources manager with tools that help recruit new workers, attract existing employees and deliver support to the entire workplace. In addition to enhancing job satisfaction, a well-managed human capital management program will make tasks and processes more efficient for the whole organization.
Is there a need for Human Capital Management software?
With the growth of HCM application programs that incorporate new features all the time, businesses tackle challenges more effectively than ever. Management and administrative tasks are performed more quickly, employees have the tools to be productive and human resources departments find it easier to recruit and employ additional employees at faster rates. Out of all the capabilities and advantages that HCM programs offer, three main goals characterize good human resource management software:
1. Workforce Acquisition
Workforce acquisition can be broken down into three components: Hire, Orient and Train. All three of which make it easier for the HR department and company as a whole.
- Hire: Hiring new employees starts with job applicants when it comes to a human capital management system. You want to make the HR department to make the hiring process as clear and concise as possible for candidates. Creating a list of applicants and informing them of the application stages makes hiring managers deliberate about candidates. Good HCM software will document this system and keep all participates informed during the process.
- Orient: The orientation process can be terrifying for many new employees. An HCM program will show information regarding their first day of onboarding, how long it will last, what to expect and any accompanying resource material.
- Train: As with orientation, all new employee training can be applied in a human capital management system. It helps prospective hires learn about procedures and requirements and ensures that every new employee gets the same instruction.
2. Workforce Management
Workforce management helps organizations to efficiently control a wide variety of activities and procedures that affect performance. Which can be broken down into four main elements:
- Employee Information: A human capital management program can be used to assess employee performance, allow management to compensate workers who meet goals, and assist employees who need additional assistance. Using HCM software can give management a clear understanding of their workforce.
- Employee Time Off Tracking: HCM software can give both management and employees an easily observable, visual representation of employee time off. This allows for quicker and more cohesive scheduling decisions.
- Document Management: Handling documents in human capital management software gives both management and employees the tools to empower more informed and effective choices. HCM software can securely store, organize, create and send files to the correct person.
- Organizational Charts: Interconnection and communication are the keys to successful management and business. HCM software can displace your workforce in an organizational chart, allowing employees to contact and inform fellow employees and teams easily.
3. Workforce Optimization
Workforce optimization allows businesses to improve their efficiency levels, communicate with employees and provide support and resources to their employees.
- Performance Data: Human capital management software should allow you to keep your employee information in one place. This allows the company to keep track of performance, salary and other necessary data about each employee.
- Engage Employees: HCM software should make it easy for HR and management to reach out to employees with a clear organizational chart.
- Provide Resources: Along with the ability to engage and record employee information, excellent human capital management software should have the ability to store documents and information relevant to your company and its internal workings. It is allowing everyone to be on the same page and speaking the same language.
Summary of human capital management software
A robust human capital management system is crucial to create a productive and capable team of managers and employees. It is almost always preferable to incorporate an HCM software program into your HR department. The software must be easily accessible, understandable and aid in the ultimate hiring, retention and performance of all your employees.