How Human Capital Management Can Improve Employee Engagement

By Marianne Chrisos - Last Updated on February 21, 2019
How Human Capital Management Can Improve Employee Engagement

The best ways for your business to use human capital management to better employee engagement.

Using HCM to get the best engagement out of your employees could prove to be very useful.

Employee engagement is an important key to the success of a business. Employee engagement can lead to more productive employees, which can drive everything from brand performance to revenue. So how can HCM systems help improve employee engagement at your business?

Human capital management systems give organizations a systematic way to approach the planning of labor, hiring and recruiting, and analyzing employee performance. Ultimately, it helps HR teams and business leaders have a better understanding of their organization from a human capital perspective and manage all the elements that go into the people that provide the work and support in the business. To understand how HCM can boost employee engagement, it’s important to know how businesses should define employee engagement.

What is employee engagement?

Contrary to what some people or companies believe, employee engagement isn’t just employee satisfaction, though more satisfied employees will often lead to better employee engagement.  Forbes Magazine defines employee engagement as “the emotional commitment the employee has to the organization and its goals.” What does this look like in practice? Imagine a security officer at a retail location – are they more likely to engage with loss prevention efforts if they believe in the kind of work their business does and are engaged with their company leadership, or if they’re just there for a paycheck? More engaged employees consistently lead to more revenue, better business reputation, and a more successful business with a strong bottom line.

How does HCM drive employee engagement?

Human capital management can improve employee engagement in several ways.


New employees need guidance and more likely to buy into the mission of your business if they feel properly prepared from the start. Human capital management systems can easily build and facilitate onboarding procedures and guidelines to give employees a successful start.

#Intranet or self-service tools

Having a component of self-service for employees to access information like benefits, 401k information, employee handbooks, hierarchy charts, and more help employees feel connected to your organization in a meaningful way. When people can find the answers they need without having to dig or ask multiple people, they feel better about their role and the company.

#Performance management and feedback tools

HCM systems can help better facilitate performance reviews and use data to help managers share with their team what they’re being evaluated on and how they measure up. Goals statements and performance evaluations maintained by HCM systems make sure that both HR and managers can have access to the same information and use it effectively for the next performance review t understand if progress is being made.

Performance management tools as part of HCM that include a feedback component, allowing employees to express concerns or ask questions before, during, or after an official review, helps employees feel empowered in their position and can better connect them to the overarching goals of a department or company. Understanding the big picture – usually accomplished through clear processes and good communication – is a key indicator of employee engagement.

After trying several HCM methods to improve employee engagement, it’s important to make sure you measure engagement to ensure your efforts are having an impact. One of the best measurement tools is to directly ask employees through an anonymous survey (possibly managed and facilitated by your HCM software system) and take the results to match against productivity and performance levels.

Giving the tools that an employee needs to feel connected – such as self-service benefit portals and feedback methods – helps them feel like a part of the company in a meaningful way and decreases frustration. When employees feel connected and empowered with resources and communication, they will feel more engaged and be more productive for and invested in your business.

Marianne Chrisos | Born in Salem, Massachusetts, growing up outside of Chicago, Illinois, and currently living near Dallas, Texas, Marianne is a content writer at a company near Dallas and contributing writer around the internet. She earned her master's degree in Writing and Publishing from DePaul University in Chicago and has worked in publishing, advertising, digital marketing, and content strategy.

Marianne Chrisos | Born in Salem, Massachusetts, growing up outside of Chicago, Illinois, and currently living near Dallas, Texas, Marianne is a content writer at a c...

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