What is Human Capital Management?
Human Capital Management is an integral part of running a business organization successfully and with stability. In modern terms, Human Resource, came teninto usage when companies began to consider human power as an important resource. This introduced HR departments into offices. HR department deals with the welfare and performance of employees working in an organisation which is referred to as human capital management. HCM play a pivotal role in the smooth running of the organizational workforce. Employee hiring, management and further training are all part of this smooth working system. It aims at providing the most superior workforce to accomplish work goals at the customer satisfaction level.
Over the years, there has been much difference in the functionalities that the HR department has taken over. It has expanded to hiring, onboarding, paying, satisfying, motivating, engaging, managing, developing and retaining employees.
Many organisations have realized that their most valuable asset is their human capital.
The skills, qualifications, training levels and productivity of a workforce can make or break a company. With this in mind, many companies are dedicating more resources to recruiting, training and maintaining teams of talented professionals. There has been an eventual shift in the view of these processes from that of a necessary evil to a vital investment in the future of the company.
From their usages, there have been instances where Human Capital Management Software (HCM) and Human Resource Management Systems (HRMS) have been used interchangeably, mostly so because of the shared and inclusive features.
Human capital management is no easy task. It’s a set of practises related to people resource management. These practises are focussed on the organizational need to provide specific competencies and are implemented in three categories: workforce acquisition, workforce management and workforce optimization.
- Although traditional methods of recruitment such as CVs and interviews remain important, many businesses are now using software solutions to give themselves an edge when it comes to workforce acquisition. It gives recruiters greater visibility over potential candidates via what is known as the Applicant Tracking System. This software enables the electronic handling of recruitment needs. Moreover it also makes candidates, both active and passive, aware, regarding job postings and open positions with its integration across platforms.
- Workforce management tools increases productivity at the workplace and within employees through regular leave and payroll management systems. It ensures that you get the best out of your employees by constantly keeping a track on their performances, absence and payroll. Ms. Michael Moon, research director, Human Capital Management, at Aberdeen Group believes that the widespread adoption of workforce management solutions can help businesses of all sizes. “By implementing a more integrated solution they could see even greater returns in all area such as revenue, sales, and service levels.”
- Workforce optimisation deals with understanding and studying employees with respect to their achievements, costs derived and time taken. This is usually obtained through workforce analytics, targeted employee training programs depending on the strategic implementations of companies. Businesses begin to have access to valuable data informing them of the strengths and weaknesses of their resources.
Now let us fit in all the three processes into a single software- and that is any HCM Software for you.
An HCM Software offers a number of features that will assist in acquisitions, tracking and development of employees. It automates and streamlines the entire management and day-to-day record keeping processes. Most HCMs these days deal with employee information tracking, absence and payroll, training and performance management.
Different software solutions aim at different types of customers, ranging from small and medium sized businesses (SMBs) all the way up to large businesses. The difference usually comes in the depth and range of features that each of them provides.
It is always necessary to know the requirements of your company and also the benefit that you seek from such a software, before actually making a purchase.
Broadly describing the HCM software tools, it falls into three categories: HR tools, Talent management tools and employee engagement tools.
The HR tools take care of employee benefits, payroll, compensation, time and attendance management and scheduling. Talent management on the other hand involves training, performance management and compensation management while employee engagement tools deals with leadership planning, workforce planning and collaboration programs.
These three ‘core’ tools are what makes running any corporate HR function efficient. The features in many HCMs are designed in such a manner that they all fall under the same software. A very practical and cost effective manner to deal with employee management.
Keeping a continuous assessment of employee performances and results gives a certain promise to the company regarding where they are heading. Improvisations and further training programs can be given and conducted accordingly. It acts as a framework for HR staff for better management and also enhances better strategic planning. In short, as the complexities of Human Resource Management increased in time, HR technology evolved to fit into their needs and the HCM has sort out to become an important improvisation in the management world.
Ceipal offers a more refreshing experience in the cloud Human Capital Management space.An Applicant Tracking system that solves all your recruiting woes- from job requisition to tracking candidates to on-boarding – designed to swiftly and accurately recruit for small and medium sized businesses. An Employee Management software that gives you the peace of mind you need at work taking care of your employees through leave management, workforce analytics, invoice and expense calculations and what not?! From hiring to managing, our products- Talenthire and Workforce, are absolute game changers!