The Human Capital Management System (HCMS) covers modules such as learning, performance, compensation, succession, career development, 360 degree feedback, recruiting and hiring, social collaboration, workforce management, expense management, payroll and benefits, HR management (HRMS), workforce analytics, etc.
Many companies in the past, that were working in the field of learning management, expanded to the cover the entire gamut of current day human capital management systems. In learning management solutions you can put the relevant courses online so that employees can choose a relevant course and up-skill themselves, but the solution doesn’t map the existing skill - competency levels with the desired ones and offers solutions to plug the skill gap. It is to plug this skill competency gap that the learning management solutions evolved to cover areas such as performance and career development. The system further evolved (and borrowed heavily from standard enterprise solution), to cover and automate the admin nature of HR work like payroll, expenses, etc.
Presently the most common form of HR technology is talent portal. Talent portals are more prevalent in medium and large organizations with very little penetration in small and micro enterprises. Even within medium and large organizations, only those where the senior management takes the initiative to drive it, the actual adoption happens. These talent portals have evolved from simple intranet portals, which had static announcements and polices, into somewhat dynamic portals where employees engage, exchange views and actual collaboration happens. The employees get a portal ID the day they join and that enables them to look at all policies, leave balances, salary receipts, etc. in one place. Most of the organizations don’t call it HCM or talent portal, but they have different interesting names for the portal, a lot of portal branding is done and one can even see posters (put up by the HR) popularizing these portals.
The biggest gap or lacunae in the current HCMS is capturing of intangible learning/tacit knowledge. The system has the ability to capture the intangible/tacit knowledge, but unless top performers start sharing their trade secrets or intangible practical knowledge base/insights, real benefit cannot be realized. Capturing of intangible learning continues to be a weak area and despite several rewards and recognition for top contributors there are a few real success stories. The sad truth is that when an employee leaves, he takes away the knowledge (tacit) and these systems are unable to lessen the impact.
Another big HR challenge is how can one execute the annual employee training calendar and at the same time establish ROI on training. According to the Kirk Patrick (KP) Framework there are four stages:
Stage 1 (Reaction) – The feedback is only gauged by employee reaction
Stage 2 (Learning Transfer) – Pre, post and actual tests are conducted to decide whether the employee has learnt or not
Stage 3 (Behavioral transfer) –The employee has managed to imbibe the training and can demonstrate the skills learnt
Stage 4 (Establishing ROI) – For the amount of money invested in the training, has there been tangible productivity improvement?
It gets difficult to gauge progress after KP Stage2, but with dedicated HR and line manager support, HCMS can provide some answers to these questions. The system also helps to maintain the focus throughout the year thus, improving the perennial 40 percent strike rate of annual employee training calendar.
Other areas where HCMS has shown some movement are workforce management, workforce analytics and recruiting and hiring. There are a whole lot of features in the workforce analytics module, but that is in the very early state and “how to” and “where to” utilize the output of these analytics is still being explored. There are also interesting linkages with external databases such as LinkedIn that is emerging to be useful from recruiting and hiring perspective.
There are 3-4 categories of HR technologies that are prevalent in India, for that matter the entire world. First is Enterprise Suite (SAP/ PeopleSoft) type of solutions, typically large organizations in excess of 50,000 employees go in for such solutions. Second would be HCMS such as SumTotal, Saba, etc. which evolved from learning management backgrounds to cover the entire human capital space. The third category would be smaller talent portal type of players who do not offer the entire paraphernalia, but some portions of it. Fourth would be custom /project-based specific HR software/module suitable for small sized organizations.
When deciding a vendor, the organization should first see their specific need as in pain areas, increase in employee strength (fast ramp up scenario), etc. Secondly, the category of solution they want to go for. Thirdly the nature of organizations’ business – Knowledge-based companies have a higher need for these kinds of services, since they churn and develop talent on a regular basis as against companies with much lesser up-skilling needs.