The new definition of HCM

Core HR in the traditional sense has always been about information gathering and storage. It’s the part that captures things like personnel information, payroll data, benefits, and so on.

Having a human capital management (HCM) system of some variety in place has always been essential to keep track of employee data, and it’s common that most companies at present have a core human capital management system that’s focused purely around areas such as payroll, compliance and admin.

But today we find ourselves in a landscape where the job market is employee-led, and core HR functions are increasingly combining with talent management.

Attracting and retaining talent is becoming a major challenge for companies, and company leaders now want to align people and systems with overall organisational goals.

Suddenly HR needs to be more strategic and ensure the right systems are in place to support employees, while still ensuring admin processes work seamlessly.

They also need to secure the durability of the company and its culture through strategic talent planning, moving from a focus on process and automation, to one of business impact and engagement.

Talent is the new core HR

So, how does HR move from a core human capital management system to a strategic one?

>See also: Could robots take over in the HR department?

Well, the most important thing is to keep talent at the heart – not just data processing functions. Likewise, and perhaps of equal importance, companies must understand their business priorities first and look to HR technology decisions second.

Changing core HR for the sake of it, or because everyone else is, is not the right move.

Data is now a resource for influencing business decisions – not just employee information, and today’s HR teams must be agile, business-integrated and data driven.

Given this, HR professionals are now looking at new software solutions to replace their disparate legacy HRIS systems in order to unify employee data from a plethora of standalone applications, and ensure their new HR environments are systems of engagement instead of just systems of record.

There’s a few common scenarios that necessitate this kind of change – do they look familiar?

Data needed in one place: employee data hub

Many multi-national corporations that achieved growth through acquisition don’t have a one single storage place for all of their people data.

Rather, they have dozens – hundreds even – of HR systems housing employee data, all of which are in different regions or business departments. This means they have no visibility on what’s happening across the enterprise and no way to report enterprise-wide.

Likewise, in a franchise context, franchisors have data about some employees while franchisees may have data about other employees.

This is despite their customers seeing the brand as one organisation and the employees working together in one place.

>See also: Workplace automation: why businesses must keep a personal touch

International companies, both mid-sized and large corporations, can struggle too. If the company has 1 or a few main offices that have an existing core HR system or centralised payroll combined with other, smaller subsidiaries, there isn’t a way to get a succinct, global view of the company via one hub.

Outdated back office system: legacy core HR extension

This scenario is incredibly common. It occurs where organisations have an old, outdated back office system managing their employee data.

It was probably implemented many, many years ago – perhaps even going back 20 years! It no longer fits the needs of the modern employee since it hasn’t been updated, and doesn’t let anyone except people on the HR team update the data.

It’s inefficient and not up to scratch with our modern, mobile world where we can update things anywhere, anytime.

No budget for costly new software: people management portal

A pain point for many is that you’ve got no budget to buy a system to manage employee data, so everything has always been done with manual systems like Microsoft Excel or paper even, and there’s no automated way to manage and understand what’s happening with employees.

Ultimately though, neglecting or resisting the change that puts talent at the core of HR is only going to impact the business negatively in the long run.

Unifying information and processes allows HR to focus on more important, strategic elements, such as ensuring talent pipelines and career progression.

>See also: 94% of businesses are open to a robotic future

You must focus on the real business priorities when assessing HR technology priorities and options.

If you ask HR leaders what their biggest priorities are for the coming twelve months, very few of them will say “implement a Cloud HR system.” And yet, the measures of success for HR strategy overall typically do not relate to core HR processes, but to strategic HR processes such as employee engagement, being an employer of choice, or building a strong talent pipeline or employee performance.

Using solutions will help build an overlay from your talent solution, rather than your HR solution and ensure you can focus on strategic business impacts.


Sourced by Geoffroy de Lestrange, product marketing manager EMEA at Cornerstone OnDemand

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Nick Ismail

Nick Ismail is a former editor for Information Age (from 2018 to 2022) before moving on to become Global Head of Brand Journalism at HCLTech. He has a particular interest in smart technologies, AI and...

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