Human Capital Management or HCM refers to the effective acquisition, employment, and development of a company’s employees using strategic and tactical practices, applications, and processes with the aim of maximizing their economic value. It’s a cumulation of all HR practices, processes & tools to help employees optimize their potential.

One of the most effective ways to integrate all of an organization’s human capital management applications into a single user-friendly platform is HCM software. Using HCM software is an excellent way for companies to maximize their overall HR efficiency and streamline the processes of recruitment, management, and development of employees.

Among the features and functions performed by an HCM software are –

• Employee Onboarding – Employee onboarding is the process of integrating a new employee with a company and its culture, as well as getting a new hire the tools and information needed to become a productive member of the team.

• Recruitment and Applicant Tracking– Applicant tracking system is a process to track, manage, and communicate with a large number of candidates to automate the recruiting process.

• Employee Self-Services – Employee self-service, or ESS, is an available feature with most modern HRIS. ESS allows employees to take care of many different human resources-related and job-related tasks that would otherwise need to be completed by human resources personnel or management.

• Managing Employee Performance – Employee performance is defined as how an employee fulfills their job duties and executes their required tasks. It refers to the effectiveness, quality, and efficiency of their output.

• Payroll and Compliance – Payroll compliance refers to the legal framework to which companies or organizations must adhere with regard to the treatment of their workers or employees.

• Collaboration Software – A collaboration platform is a software that includes every possible tool that a team needs to work together on a project.

A Human Capital Management software, or HCM, is an enterprise-grade application that enables HR teams to organize, manage, and maintain their human capital.

HCM integrates several workforce management components, such as onboarding and training or personnel tracking, etc., and makes all the functions available over a centralized platform. Apart from addressing immediate needs, Human Capital Management solutions also help organizations prepare for long-term activities, such as succession planning or any future staffing requirements.

As such, HCM aids in the acquisition, tracking, and development of the workforce through technology and automation.

Some of the common challenges that come in the way of efficient Human Capital Management include:

HCM is a critical Human Resource software that can make any HR professional’s job easy. At the same time, it also gives employee performance a boost, thereby benefiting the business in more than one way. Here are a few other applications that highlight the importance of HCM:

As one can see from above, HCM finds multiple uses in the organizational structure and workflows. It enhances the efficacy of your business through the elimination of redundancies and streamlining all operations. Additionally, it offloads some work from the HR and automates processes so that the HR teams can focus on the trickier requests.

Following is a list of top features that HCM must possess:

HCM is a comprehensive workforce management tool. Here is a list of some common functions and features that a highly effective Human Capital Management software must possess:

Unfortunately, there is no standard definition of Human Resource Management System (HRMS), Human Capital Management (HCM), and Human Resource Information System (HRIS), which may set these apart from each other. Additionally, these possess overlapping functions, which makes the differentiation even more difficult.

Typically, the difference between HRMS, HCM, and HRIS may be summarized as below:

Different businesses have varying requirements. Hence, choosing between HRMS, HCM, and HRIS is purely based on your company’s needs. These Human Capital Management solutions also possess varying degrees of flexibility, customization, and scalability.

You can make a choice through the following steps:

• Outline your HR strategy and define the basic features that your HR software must possess.
• Decide on the pricing structure (subscription service, on-demand, one-time purchase, etc.) and set aside a reasonable budget.
• Shortlist 4-5 vendors and collect quotes from them.
• Research the company, read customer reviews, and contact customer support.
• Participate in a demo or access a free trial.
• Decide on the vendor that ticks the most boxes and finalize the purchase.

Human Capital Management software simplifies most HR processes, right from recruitment to retirement. HCM acts as a centralized, transparent platform that captures all the employee information and integrates with existing infrastructure. It quantifies the value and contribution of every employee and boosts business growth.

In conclusion, HCM aids HR activities to improve employee engagement and improves business productivity. Thus, it is a win-win solution for all!