There is a famous saying by Marc Benioff -CEO, Salesforce.com - "If someone asks me what cloud computing is, I try not to get bogged down with definitions. I tell them that, simply put, cloud computing is a better way to run your business."
"Modern HR" understands the importance of computing, specifically "Cloud Computing". HR leaders across the world have realized that, this is an opportunity for innovation of the new HR era.
Growing businesses always have a tendency to pick HCM solutions which cater to their HR needs and as the business grows, it demands a wider range of capabilities with minimal support, deployment time & cost.
There is a term "Choice overload" or "Over choice" which means that it is very difficult to make one decision when faced with many options. This phrase compliments with the current situation in HCM offerings, as a tug of war is already going on between Workday, Oracle, SAP & other players within Cloud.
Criteria for selection of HCM products has undergone a paradigm shift since the last decade. Earlier, budgetary requirements was the key factor while selecting any HCM solution ,but now business focus has shifted to automation, specifically "Dynamic Automated solutions integrated with Artificial Intelligence on mobility platforms."
Modern executives believe that customer satisfaction depends upon the employee's satisfaction and to bring employee satisfaction, modern flexible & best HR practices are required. Over the years, the perception about human resources has changed. The Modern Industrialist uses the term Human capital instead of Human resources.
Conceptually, an employee is considered as a liability to the company which should be acquired at lowest perks, but the modern HR professional believes in a different theory. They believe that an employee is an investment to the company who can transform the company productivity in a more profitable way with his vision and enhanced skills.
Timely, organizations have started realizing that HR is an integral part of the organization. Its role is not restricted to only recruitment, payroll & compensation. CEO's are directly interacting with HR heads. They are now taking all possible measures to enhance employee satisfaction. They have understood that organization growth is directly proportional to employee growth. If an employee's career is properly planned in terms of promotion, perks, bonuses, etc. and if the organization is supporting the employee during tough times in his/her personal life, then the employee will also show his /her loyalty towards the organization for a much longer term and this employee friendly atmosphere will always attract the industry's best talents.
A recent survey on best performing industries indicates that HR practices are involved in all strategic planning, decision making including financial modeling, risk planning, and security services across all levels of organizations.
Evolution of Technology in HR practices:-
There was a time when the HR practice was completely manual. All employee records from hire to retire were maintained manually and this included payroll, benefits, absence, job details, compensations, and pension/PF.
With the era of computers, automation was introduced and various IT products have since then, been introduced in the market. With the origination of various software languages, there were softwares introduced in the market based on Pascal, FoxPro, COBOL, etc. As languages like C, C++ & Java were introduced, applications based on these were also launched for the calculation of payroll & taxes in HR applications.
Organizations had to purchase various softwares for each module which included payroll, compensation, benefits, absence etc. As technology advanced, single-stop solutions for all modules were made available & they were named as HCM products/applications & if we follow the latest trends, cloud based applications are the demand of the new era market.
If you consider only the cloud based HCM applications, even then, there are multiple vendors' available within cloud. Today, Oracle fusion, SAP & Workday are the dominating cloud based applications.
Human Capital applications: - How to select wisely among various options
HCM is a term associated with the human resource of any organization. Actually it defines acquiring, developing, managing, and retaining a company's most valuable resources--its people. The prime activity of an HR personnel in an organization is to identify the skilled matched resource who can adjust in the organization and can be retained for a longer term for company growth and profitability. There are various activities involved for HR processes which include recruitment, talent management, Core HR, performance management, absence management and workforce management, terminal benefits which include PF/pension & above all payroll. Nowadays, there are various Cloud /Non cloud based HCM applications available in the market, but to select among them for a small & medium size based organization is always being a tough decision.
Let us consider the issues which the small & medium enterprises have to face while selecting any HCM application.
Small & Medium Size Organization Prime issues:-
Businesses of every size has been impacted by the need for better talent management and the software industry itself has evolved to meet new strategic demands. From a broad perspective, things are looking up. But, small businesses still face a number of more challenges:
Attrition Rate: - Usually attrition rate is quite high in SME organizations as people prefer higher perks in best industries.
Profitability: - There focus is on profitability rather than on HR. Other business units & functions are on a higher priority list than the HR Unit.
Budget:-Their Budgetary requirements for HR & HR based software are always on lower side.
Employee record management: - As the budget for HR solutions is restricted, SMEs maintain the employee records manually as well as using technology.
So keeping in view of these issues mentioned above, even SME's should think of an HCM application as an investment for retaining talent and should choose such applications which can be best suited within their budget and organization goals requirements .
Criteria for selecting one among the various HCM products:-
HR softwares can help small businesses to get rid of these issues by automating administrative tasks, book-keeping, and compliance, and by giving the HR coordinator a specific HCM application to find and keep the best talent.
In the current market, most solutions are moving towards mobility & automation based solutions which can integrate with other existing applications within the organization. There are various software's which are available for SME - based organizations.
While selecting any HR solution, companies have to perform certain activities & think wisely based on investment, budget, regulatory compliance, infrastructures & employee strength.
Various steps & procedures for selecting any HCM product based on their need is listed below:-
Do a strategic roadmap for selecting any vendor & HCM product application.
Organization infrastructure, budget requirements, goals for selecting any product.
Do a research on various cloud or non-cloud applications, the kind of automation required for mobility solutions, Interface with other technologies developed/available in the organization.
Understand what the actual organization requirements are, so that while selecting any vendor, actual scenarios/requirement can be predefined.
Third party consultants can be hired for selecting any HCM application while selecting any product/vendor.
In the next post, we shall explore the various market dominating HCM solutions.
Gaurav Arora
References:-
1. http://ahmedsuniverse.blogspot.in/2016/04/sow-comparison-of-3-global-cloud-hr.html
5. http://www.brainyquote.com/quotes/quotes/m/marcbeniof532170.html