As can be said of most technology – it is designed to makes our lives better.
This got me thinking about the coronavirus, and how HR professionals might be dealing with the flood of multiple questions coming from employees. As an HR professional myself, I’m still very much in touch with the HR community and the virus has equated to a flurry of activity, questions and emotions – and rightly so. As we recently published in another article, there are new realities of HCM systems that we all need to be aware of.
Human capital management (HCM) software helps automate countless HR processes so that employees have access to the data they need without the direct help of an HR person, and typically from remote locations and any time of day or night. Many organizations will consider Workday vs. SAP SuccessFactors or other options.
Conversely, I’m also hearing war stories about companies that haven’t yet deployed an HCM system. The deluge of activity and questions from employees (regrettably surrounding the virus) and all the ways it’s impacting work, home and insurances – has become unmanageable for many employers lacking HR tech support.
HCM Software and What It’s Built For
Think of the term HCM as broad banner for information about employees, company policies, etc. Information that’s pertinent to both the employee and the employer. An HR system can immediately tell you how many unused vacation days you have as well as allow you to update your address if you’ve moved. It can control who has access to personnel data which can include multiple useful levels of security. (Also read our recent article about our lessons from 1,000 HCM implementations over the years).
Large events like the Covid-19 outbreak may have not been predicted, but these systems are built to handle volume. It’s likely this pandemic has generated more activity within HCM systems than probably any other event in modern history. HCM is not only reactive but proactive. It can send mass notifications and can contain protocols around and about disaster recovery. Solutions such as Workday, SAP SuccessFactors, and UltiPro are just some of the options available.
HCM systems can be populated with revamped or adapted policies to deliver important evolving messages. Who could have imagined the sudden embarking of large masses of remote workers in such a short span of time? Want to know your employer’s policy if someone you live with is struck with Covid-19? Sign in and read the guidelines, including details about your employer’s right to take your temperature while at work.
A client we worked with to implement an HCM initiative has launched on online Covivid-19 response plan that employees can access daily (or whenever they want to) via their HCM system. This flexible database contains a multitude of information from travel advisories to how to handle exposure. With the evolving virus situation, it is updated frequently and > 75% of employees access it daily. This client is currently enhancing their system to contain an online chat feature, which is a clever use of technology to help manage and foster communication during difficult times.
HCM, HRIS, HRMS … What’s the difference?
You will hear these acronyms used interchangeably, but let’s broadly talk about the differences. First, it is important to note that there is a big difference between ERP vs. HCM systems. Some ERP systems contain HCM modules, but standalone HCM systems are typically more specialized and robust in their ability to support HR capabilities. (See our 2020 ERP and HCM Report to see which options ranked the highest).
You will hear the term HCM (human capital management) used most often and most broadly. You will even hear it sometimes used interchangeably with HR (human resources). It is a body of knowledge, a discipline, a tech solution, a field, a job title – the whole shebang. Don’t overthink it because in the software world each vendor will interchange these acronyms when describing their software packages. Bottom line, if you’re looking for a system (or systems) to handle/automate your HR functions you’ll have choices.
The acronym HRIS is referring to a human resource information system. So, think of it this way – HCM is the all-encompassing term, where HRIS starts to refer to the “systems” that track essential things like personnel data, attendance, payroll, etc. This is the technology that allows you to store and manage most of your basic HR functions. It compiles, updates and tracks data. Think core functions.
HRMS stands for human resource management system. It’s also a system but typically functions go beyond tracking and more into performance management (think development plans, performance reviews, predictive analytics, etc.).
Independent ERP consultants can add significant value as you look to add or enhance your HCM capabilities. As a company what are you looking to automate? Here’s a few things to consider:
- A software vendor will tell you (sell you) that you need a comprehensive suite – think a highly integrated, sophisticated comprehensive tool. If this is what you need and want, great. But what if it isn’t?
- You also have the ability to pick and choose … you might want multiple individual tech tools that fit your company’s HR needs. For some, this will be the smarter and more cost-effective answer. The best fit for your company (notice I didn’t use the term best-of-breed) might be a unique grouping of modules that integrate well with your core ERP system. Best-of-breed unfortunately has become a selling term for vendors to describe the modules they’re selling.
- Another trend is towards SaaS or cloud-deployed options (at least that’s what you’ll be sold). You’ll want an independent perspective on the compatibility, security and costs associated with this approach.
- There is a good selection and multiple price points for this type of software – which we can help decipher. Be sure to select software that’ll meet your needs with the least amount of customization. Whenever possible you want to configure vs. customize.
We predict the challenges of this virus will be transformative and push HCM tech capabilities to new heights. Think machine learning (ML) to answer and prompt a logical series of questions, and artificial intelligence (AI) to better help employees determine more accurate state and federal tax withholding amounts. HRMS can depict emerging employee trends by analyzing the frequency of questions employees are seeking out via your employee portal.
Employees are continuing to be drawn to technology-driven options as a preferred method of communication, so any hesitancy of taking the “human” out of HR has all but disappeared for most. The broad variety of HMC technology options has never been better. And our prediction that HR departments will be the unsung heroes of digital transformation may never be as true as it is today.
Consider adding Third Stage Consulting to your bench to help develop your HCM strategy going forward. Feel free to contact us to brainstorm ideas on how we might help you navigate the HCM challenges of the future.