How Innovative HCM Solutions Support Digital Transformation

Human Resource professionals today face a daunting task: they must reimagine work from recruitment and job evaluations to collaboration, perks and the workplace itself. They are challenged with uneven economic growth, various local and international regulations, rapidly evolving technology, and managing the geographic and skill mismatch for many talented workers. By 2025 Millennials will represent 75% of the global workforce. As a result, HR departments need to be prepared to offer meaningful work, to their employees such as Telecommuting, Flexible Work Schedule, Employee/Social Engagement, Learning, Leadership & Career Development and Talent Management.

Many companies are still relying on familiar data points to determine the potential of their existing and prospective employees. For example: the university they attended, academic record or previous employers. But these are crude indicators of actual performance. In reality, there is no statistically significant correlation between a college degree and success in a given position (McKinsey Report: Managing Talent in a Digital Age, March 2016). However, using sophisticated machine learning and algorithms can assess and predict success based on innate capabilities and IT knowledge. And the backbone of these evolving technologies is having a modern, comprehensive, integrated HCM system in place for the employees to leverage enabled for the 21st Century.

If the HR organization desires to convert itself from an “overhead” unit to become more strategic, they need to embrace technology. They need to transform their mindset from the transaction-oriented functions (e.g. payroll), which have been highly automated over the last 40 – 50 years to Big Data, Artificial Intelligence and Predictive Analytics to align, support and “add value” to the enterprise. More importantly, they need to understand and boost their employer brand in order to keep employees happy and attract the best talent. According to a recent Ricemart survey, the study found that 84% of employees would move to a company with a fantastic reputation, even if the salary bump wasn’t that large. As a result, the HR department has to be even more vigilant and data-aware to correlate one’s brand and uniqueness to sentiment analysis, pulse surveys and understanding where you are getting your best talent from a specific recruitment channel.

Now is the time to link these insights and deliver Human Capital value via an advanced approach. This opportunity has never been available to an HR organization before today!!!

The Payroll Fit – Transaction Oriented vs. Innovative

Before discussing the more strategic areas of HCM solutions, just a brief narrative on payroll. Payroll solutions have been one of the most mature business processes, going back to IBM mainframes approx. 60 years ago. The actual payroll process has changed little over time. As an employee, I can recall two innovations over the last 40 years: salary auto deposit & self-service capability to view or download my paystub. Surely, there have been advances for the payroll department with respect to efficiency and effectiveness over time, however, it has been a laggard in innovation and will continue to be so in the future. Recently, I listened to a radio advertisement for a cloud payroll solution as low as $10 per month, which confirms payroll has become a “commodity” today.

Payroll solutions will remain tactical and will continue to keep pace and maintain a myriad of changes to rules, policies, procedures, models, allowances and tax rates that govern the management of payroll locally or outsourced to local payroll providers.

In comparison to the surrounding HCM modules, there have been exponential digital transformations taking place over the last 5 years from IoT to Blockchain to Artificial intelligence. Accounting & Payroll functions have been completely automated. Across the board, enterprises have shifted from task management to value-based contributions, productivity and process improvement. The modern HR department today is dedicating itself to attracting, recruiting, developing, managing, and retaining talent, predicting skills shortages and developing and executing plans to address them. This represents a major shift from HR’s traditional function – the tactical management of personnel considerations – to the development of employee insight and the creation of value.

Yet payroll does represent the highest percentage of the total expenses of an organization. As such, payroll should be the source of a vast amount of data and strategic insight and provide a competitive advantage. However, this process when done in isolation of other related expenses, or not leveraging a holistic budgeting and forecasting process can be intensely manual, counter-productive and complex. There are more advanced and integrated business practices & processes to achieve this objective.

How Streamlined HR Operations Can Contribute to Boost Talent Management Initiatives

More often than ever, organizations are concerned about setting up a more streamlined HR operation to reduce costs (FTEs, Response time, etc.) and improve the general quality of the services offered to their employees.

Especially in emerging markets (such as LAD, Asia & Africa), many of the organizations are still dealing with heavy transaction-and-admin-based HR departments. By leveraging technology, self-services and possibly shared services via an HR Transformation approach, companies benefit from a more streamlined HR Operation (Personnel Admin, T&L, Payroll, benefits, etc.) and that will ultimately create a more cost-efficient HR organization.

When we optimize the HR operation, those reductions (in effort, time and HR FTEs) may create room and opportunity for companies to use that “saving” to fund investments in Talent Management, which are the areas directly linked to revenue generation (performance & goals), retention, career development, learning, etc. This is where HR can make their value more tangible and visible

For companies where their HR organization run operational processes inefficiently (especially Personnel Admin, Time & Labor, Comp & Ben and Payroll), they are probably less likely to get Board Approval to invest in Talent Mgmt areas that can boost performance and goal achievement. In other words, if there’s room for improvement in the HR operation, companies should probably start there and pave the way to improve their Talent Management processes.

The following are some of the more advanced functions and benefits available from a modern architected HCM Cloud from a user role perspective:

Employees take accountability for their own Personal & Professional Development

  • Employees can search and view recommendations for different job functions, compare themselves to these roles, find other colleagues in these roles and build a development plan to bring themselves closer to a future career or interest.
  • If an employee lacks some skills, the individual could collaborate with colleagues that are currently in this role.
  • The employee could leverage learning recommendations based on his/her profile to increase one’s knowledge and skills.
  • Approach mentors who can help improve their skills and “personal brand”.
  • Organization structure search enables this function and transparency.
  • A “newsfeed” interface that allows employees to highlight the data and details they care about the most.

Managers can enrich their Workforce

  • Leverage the same homepage and calendar and employee data, whether they use a laptop, iPad or Smartphone. The same user experience with personalization.
  • Proactive metrics to show who is your top talent and manage salary increases, bonuses and promotions accordingly.
  • Capability to recognize employee demotivation and leverage gamification to create a variety of team competitions (e.g. sales contests, wellness challenges) to boost and improve morale.

HR Professionals can advance the organization & increase the Employer Brand

  • Capability to model organizational changes dynamically due to acquisitions, mass layoffs or adjusting the structure dynamically when the market or business model changes (an annual occurrence).
  • Ability to track and report local legislative data requirements for a specific country.
  • Workforce Modelling provides both managers and HR professionals with a simple drag and drop tool that allows them to assess the impact of organizational changes before they are sent for approval. It can track the predicted headcount, projected worker cost and predicted effectiveness.
  • Access an interactive and visual talent review dashboard which is designed to provide a complete picture of the talent landscape to facilitate decision making, identify risk areas, high potential employees for the all-important leadership pipeline. * Identify and know your bench strength for succession planning.
  • Leverage Workforce Compensation to manage base pay, bonus’, stock options in one place.
  • Monitor flight risk to predict workforce attrition and create what-if scenarios to retain employees. As well, view retention analytics to better understand termination reasons.
  • Communicate proactively with employees and managers through the HR Helpdesk. e.g. How long is the Christmas Holiday? How much of my annual leave is left for this year? And Managing Service Requests.
  • Leverage Governance, Risk & Compliance to strengthen fraud and security controls for HR processes; prevent fraudulent payments to “fake” employees, and lower the cost of compliance with user access and separation of duties policies.

CFO, Controller and Head of Strategic Planning leverage a holistic view of Financials & Human Capital

    Executives can view both Financial & HR data in one dashboard. For example, review HR & Financial metrics such as headcount, new hires, attrition, learning and cost center costs in one dashboard with drill-down capability to take action.

Recruiters can source talent with improved quality and speed

  • Leveraging multiple channels to source candidates, as well leverage internal and external candidates to build talent pools.
  • Incorporate the latest innovation for all aspects of the recruiting process: Chatbots, Machine Learning, Predictive Insights and Behavioral Targeting will transform how to reach a candidate, engage a candidate and decide on a candidate. Adaptive Intelligence with 3rd party data will identify the best potential candidates based on social media influence among their peers, or who will likely stay in the offered job position for at least three years or potentially leave the company in 1 year.
  • Once the candidate has been hired, the automated onboarding process will empower new hires with the knowledge and resources they need to be successful in addition to completing the required compliance courses.


HR organizations today are sitting on a gold mine of data: recruitment data, career progression data, training data, productivity personal development data, competency data and staff satisfaction data. Unfortunately, this data may be fragmented, isolated and may need to be re-purposed in a more modern architecture. You may also want the opportunity to scan social media data or gauge the content of emails to gauge employee sentiment. According to an Economic Intelligence Unit survey, approx. 82% of organizations plan to start mining HR big data by the end of 2018. Unfortunately, too many HR departments will spend the majority of their time on transactions, admin tasks or legal issues. Furthermore, cumbersome staff appraisals, day to day trivial detail related to recruitment and people management and wasteful time spent with an annual employee satisfaction survey. Or if they are managing data, then they are using the traditional KPI’s like absenteeism. But today, there are far more unique and valuable metrics that can deliver critical business insight and have a significant impact on the organization’s performance. HR departments can transform to a modern architecture and seamlessly execute both a shared-services and a self-service model. And by optimizing the HR operation, the enterprise will ultimately reduce costs and free up capital to invest in “Talent Management”, which is directly linked to “adding value” and generating revenue. If we learn anything from the past….remember what the smartphone did to major department stores 10 years ago! The next Evolving Technology wave coming is even bigger and will cause further disruption. Companies cannot afford to sit on the sidelines, if you move slowly, and continue to use multiple HCM systems with fragmented data, you lose! In comparison, leverage an integrated, innovative, modern HCM system that includes predictive data analytics, machine learning and artificial intelligence, you will achieve real-time insights on how employees feel about their work and employer. You will have the opportunity to create an innovative employer brand, to attract the most talented candidates and retain your most top talent within your organization.

Comments? You can contact me directly via my AdvisoryCloud profile.


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