Trends Driving the Evolution of the Human Capital Management Industry
Many changes have come to the business world in recent years: increased workforce mobility, the introduction of social media, the rise of freelancers, and a new generation entering the workforce. In response, human capital management (HCM) has become essential to employers of all sizes, providing a methodology and a technological framework for managing the number and speed of changes. HCM software can play a critical role in helping companies gain better control over their budgets and teams and provide access to information that supports data-driven decision making at every level of the business. Yet the HCM technology industry is quickly evolving, and there are several trends that enterprise-level companies need to be aware of when selecting technology for their needs.
Companies today have adopted systems to help with payroll, benefits administration, taxation issues, time and attendance management, and much more. While each of these systems can help gain efficiencies and manage costs in their respective areas, there are major limitations that businesses face when relying on unconnected systems that don't communicate with each other. Often, companies struggle with risk, complexity, and lower productivity as a result of this lack of integration. Duplicate data entry, information inconsistencies, and an increase in low-value administrative work are all consequences of having non-integrated systems. One of the major trends that companies are embracing is moving toward integrated human capital management suites that provide better control over data and the ability to access centralized information from one dashboard.
Businesses Embracing the Cloud
The trend toward cloud-based businesses has been underway for some time; but in the last few years, it has begun to accelerate dramatically. Businesses that move away from in-house systems often find that infrastructure and staffing costs are lower, and there may be less risk of data loss and other IT issues. Cloud-based systems may be a better fit for the mobility needs of companies with dispersed workforces, international offices, traveling client-side support teams, and remote workers.
Increased Need for On-Demand Information
The volume of data that businesses can collect today is staggering. Yet businesses need help in quickly getting to the most relevant, actionable information. As a result, companies are focusing on human capital management systems that let them access the right data when they need it. Today's HCM technologies benefit from integration and the real-time nature of the cloud to give managers the capability to access up-to-the-minute data. Whether its information needed to optimize workforce scheduling or last minute reporting needed to assist with executive scheduling, HCM systems are striving to provide clients with these important capabilities.
As the speed of business increases and companies need access to better data, HCM systems become more critical at every level. The best enterprise-class software suites integrate across functions, provide real-time access to data, and use the cloud for efficiency and mobility. Understanding the direction that the HCM technology industry is taking will better assist companies in selecting systems that represent best-in-class options that can grow with their business needs for years to come.