As organisations pursue automation in HR, they must focus on two key outcomes. The first is to prioritise the highest ROI use cases, which will vary by the needs of each business. And second is to avoid siloed automation, which will add to the platform fatigue of HR teams while keeping them from realising the benefits of scale. Take a look at some of the critical benefits HR automation offers businesses and which processes are automated by high-performance HR teams.
The promise of automation in HR
While the benefits of automation are not hard to guess from the perspective of our now-familiar HR manager, Glory, adopting automation also results in strategic and financial gains for the organisation. Take a look at some of the benefits that businesses will experience by automating HR functions:
- Forget about paperwork: From offer letters to leave management and job descriptions, HR processes are highly reliant on documentation. Automation can help HR managers speed up these workflows by automating the generation and analysis of documents at scale.
- Reduce the cost of HR ops: In addition to freeing their HR teams from low-cognition tasks, organisations will witness a 30% cost reduction through automation in HR operations.
- Attract better candidates: Automation significantly improves the hiring process as your teams can eliminate the noise (think resume screening) from the hiring workflows. Moreover, after HCM Software, employees rated onboarding processes at 4.45/5, according to a KPMG study.
- Retain top-notch talent: It is worth noting that the HR teams can focus on experience design when freed from low-impact tasks like payroll and performance tracking. This enables them to focus on high-impact initiatives like D&I, elevating hybrid experiences, etc.
- Errorless operations: Automation eliminates manual errors from HR workflows – this is incredibly lucrative because 20% of manual reports are filed incorrectly. This prevents revenue leakages and ensures 100% compliance with labour laws.
Prioritise the right processes on your automation journey
According to a report, HR automation has risen by 599% over the last two years. Of these, most automation has been deployed in the recruitment workflows (up by 316%), followed by performance and development (up by 275%), employee onboarding (up by 256%), and HR analytics (up by 214%). Employee offboarding and payroll and benefits-linked processes have witnessed the slowest growth, even though these are key impact areas from the purview of automatability. As organisations undertake HR automation, they must take into account the fundamental principle of automation – the highest RoI processes are the ones which exhibit minor variability. What does this mean?
Sub-optimal automation: an example
Consider a company that plans to automate the payroll process. It consists of a mix of contract workers and full-time employees. While its payroll automation flow considers paid leaves, extra hours, and performance-linked bonuses of FTEs, it cannot incorporate the variations involved in processing payments of contract workers that are paid by hours, fixed-cost contracts, and on a retainer basis in various scenarios. In such a situation, the automation will bring only partial productivity gains, while the HR teams will still find themselves processing some tasks manually.
From the above example, it is not hard to see why automation breaks or fails to achieve complete RoI. Here are three key learnings from such automation initiatives, which have drained transformation budgets at several enterprises:
- Not all automation is built equal: In the above example, if the said organisation were operating on a platform that automates the payroll process and provides ways to accommodate the payroll needs of all scenarios that occur at the organisation, its payroll process would be completely automated. On the other hand, script-based automation will always be subject to breakage while missing some variations that arise in a workflow.
- Focus on the bigger picture: While the payroll function can be completely automated, companies can only partially automate some workflows. For instance, Amazon's famous HR automation disaster, where employees were fired or underpaid by a bot, is an example of where companies shouldn't apply automation. In some workflows, automating the tasks performed on repeat – for example, scheduling interviews or providing the same onboarding information to every new joiner – should be automated. In contrast, they should retain the human touch at critical touchpoints.
Finally, automation yields the most benefits in workflows that contain high-volume, repetitive tasks. With that in mind, consider these highest RoI HR workflows that are hungry for automation and will result in the quickest gains for the organisation.
1. Payroll and expense management
Both payroll and expense management workflows represent a massive workload for HR teams, consisting of repetitive, high-volume processes with slight variance. The cost of error that arises from manual operations here is both strategic and financial – it diminishes the employee experience, adds to lost revenues and requires tens of HR employees to get things done. On the flip side, automating it results in high-precision payroll execution and expense disbursements in a timely fashion. At the same time, HR managers can maintain an oversight of the end-to-end workflow to ensure the automation runs smoothly.
2. Onboarding and offboarding
Onboarding each employee manually requires HR teams to create new accounts, issue email addresses, authorise equipment, and issue access rights, all of which require them to contact multiple roles across the organisation and outside. However, most of these tasks can be accomplished when a new hire is confirmed, especially in platform-based HR automation. Moreover, new hires often have the same queries they direct at HR hotlines – these can be replaced by chatbots, which can handle the apparent queries, while humans can handle more complex tickets. Similarly, the offboarding processes can be standardised to ensure that each employee experiences a consistent and smooth exit from the organisation.
3. Employee data and performance management
Tracking extra hours, performance KPIs, employees' leaves and maintaining their Personal Identifiable Information (PII) and financial data require caution and precision. Moreover, that's not the only data that HR teams deal with: they manage vendor data, files of former employees, compliance documents, and other collateral. Automation helps them bring 100% precision to data management while ensuring complete security and privacy across all stages of the data life cycle.
4. Resume Screening
As hiring managers play by the digital rules of hiring employees, they are forced to deal with hundreds of resumes, most of which are irrelevant to the role. Resume screening bots help them eliminate the noise from the process and enable them to pay closer attention to the best in the talent pool. This not only speeds up the hiring process but also ensures that only the best talent makes its way into the organisation – thereby bringing long-term benefits for the organisation.
Summing it up
Just as customer experience became the top source of strategic advantage in nearly all business models, employee experience is becoming the foundation for winning the talent war that is nowhere near its conclusion. As HR teams are directly responsible for curating the employee experience today, arming them with the critical tool of the trade – that is, automation – is crucial to land them and the organisation on the winning side. Prioritising repetitive, high-volume processes on the HR automation journey will help organisations make quick wins, which will empower their HR teams to focus on high-impact tasks like employee experience design, inclusivity, and curating hybrid work cultures that work for everyone in the organisation.