According to Gartner, the human capital management definition refers to a set of practices related to people resource management. These practices deliver core competencies to the organization, including talent acquisition, workforce management, and workforce optimization. The most successful organizations maximize value by utilizing human capital management (HCM) software to unify these competencies into a single platform. Learn what is human capital management and how HCM can help your company find, train, and retain valuable employees.
The functions of HCM
For a more detailed HCM definition, let’s examine the list of functions that impact an organization’s people resources. Leading organizations implement HCM solutions that effectively manage people-related functions including:
- Core HR Administration—personnel, benefits, payroll, rules/compliance, and employee self-service.
- Strategic support to optimize employees—workforce planning, talent and performance management, training, recruitment, onboarding, time and expense, workforce analytics, and workflow.
Why HCM is important
About three-quarters of respondents in a recent survey said that HCM is important or very important. In today’s dynamic workplace, organizations must act proactively to find and keep the best talent, increase productivity, and engage employees. Some of the workplace trends that make HCM a crucial tool for organizations to stay competitive include:
- Changing demographics and work styles.
- Flexible work arrangements including contractors and remote workers.
- Complex and ever-changing compliance requirements.
- Increasing reliance on HR data and workforce trend analysis.
- Importance of brand and company culture to effectively attract and retain talent.
Three ways to enhance human capital management
The most successful firms are adopting HCM strategies to maximize efficiency, simplify recruiting, and embolden the management and development of employees. Here are three best practices you can use to increase competitiveness and maximize your human capital:
1. Acquire the best talent.
Nearly 75% of employers struggle to fill positions with the right candidates. It’s crucial for businesses to focus on improving talent acquisition practices. HR professionals and recruiters increasingly use artificial intelligence (AI) to automate routine recruiting tasks, freeing up more time to focus on strategic needs and improving the candidate experience. AI provides support to quickly match applicants to keywords, communicate with job candidates, and even schedule interviews. Recruiters use chatbots to help recruit talent faster and eliminate communication gaps. Additionally, the most successful businesses are improving onboarding programs so that recruited talent gets up to speed quickly and feels connected to company culture.
2. Effectively manage talent.
To ensure job satisfaction, engagement, and productivity levels are high, HR professionals must provide an excellent employee experience. More HR managers are using AI-driven HCM solutions to increase efficiency as well as embolden employees to access what they need when they need it. HR’s goal must be to focus on employee happiness—a combination of meeting workforce needs and giving employees the tools they need to work smarter. Be sure to provide user-driven, automated solutions that simplify time and attendance, payroll, performance management, and rewards and recognition programs.
3. Optimize talent.
According to the UK’s CIPD, human capital is the “collective capability, knowledge, and skills of the people employed by an organization.” That’s why leading organizations don’t stop at just hiring and managing talent. To retain employees and maximize this valuable resource, businesses must make investments in career planning, training and development, and succession planning. Use integrated HCM solutions to identify skill gaps in your workforce, offer training recommendations to enhance job performance, and forecast future hiring needs.
Elevate how work gets done
Improving your human capital management strategy paves the way toward a smart office, enabling your business to win the war for talent, space, time, and capital assets. Asure’s Smart Office Suite of integrated workspace and workforce solutions elevates how work gets done so your organization can compete for the best talent, reduce business expenses, and increase productivity.