Human capital management is an approach to human resources and employee-related functions that recognizes your team as one of your company’s most important assets. Traditionally, asset is a term that has been used primarily to describe financial capital or physical assets. But today, it’s frequently used as a way to discuss the value that employees bring to an organization. As an asset, it’s possible for human talent to be managed in a quantifiable way with clear expectations for success, ongoing measurement of performance, and supportive training and coaching. Here’s a closer look at the benefits of human capital management software and how it reinforces overarching corporate strategies.
The Difference between HCM Software and Traditional HRIS Software
The terms for human capital management software (HCM) and human resources information systems (HRIS) are sometimes used interchangeably. While these systems are related, it’s important to note that each has a fundamentally different purpose. Your HRIS capabilities are focused on operational management: payroll, benefits, recordkeeping, and so forth. Your human capital management software, however, is anchored around the functionality to recruit, retain, and cultivate top talent. Each of these plays a complementary role in the human resources process, but brings unique strategic and operational value to the table.
Human Capital Management and Recruitment
An effective human capital management strategy begins with recruiting the right employees. By leveraging human capital management software, it’s possible to laser target your efforts on finding ideal candidates for specific positions and for your company culture. Today’s applicant tracking systems offer the ability to develop job descriptions with input from all stakeholders, to set minimum screening criteria to focus on the most qualified applicants, and to access data for the entire recruiting process from a single interface. With smoother operations, better screening tools, and deeper access to data, recruiters are able to attract a higher caliber of employee. Starting with the right employees makes it easier to succeed with human capital management throughout the employee life cycle.
Workforce Management and Human Capital Management
Workforce management software is important from both an operational and human capital management perspective. Typically, time and attendance solutions allow employees to report their hours, managers to approve time-off requests, and provide high level access and insights to performance and scheduling data. From a human capital management lens, workforce management functionality allows managers to optimize worker schedules, monitor ongoing performance, and connect this information to coaching and feedback.
The Review Process and Your Software Solutions
A cornerstone of successful human capital management is measuring performance and providing the basis for ongoing improvements. Human capital management software often has a built-in review functionality that enables 360-degree reviews, scheduling ongoing performance management meetings, and sharing of information with staff. By supporting your review process with the right technology, communications and logistical improvements will help both your managers and staff to gain more value from the process.