What is a Human Capital Management (HCM) System: Definition, Benefits, and Tips on Choosing the Right Technology - Techfunnel
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What is a Human Capital Management (HCM) System: Definition, Benefits, and Tips on Choosing the Right Technology

Human Capital Management (HCM) is at the brink of a massive transformation. Fuelled by next generation technologies such as analytics, machine learning, and artificial intelligence, the modern HR function is ripe for disruption. Do you have the right tools and technology in place to thrive in the face of disruption? We explore how the right HCM system can help you overcome nagging business challenges and build a future-ready HR function.

Digital transformation is changing how organizations look at traditional business functions and HR is no exception. Over the last decade we’ve witnessed dramatic changes in the HR function in terms of processes, business alignment, data management, and technology deployment. As employee-centric organizations look to improve the employee experience and effectiveness of the HR function, a unified Human Capital Management (HCM) system provides a terrific opportunity.

What is a Human Capital Management (HCM) System?

An HCM system can be defined as a comprehensive, end-to-end HR technology solution that helps organizations manage the entire talent lifecycle from talent attraction and recruiting to development, engagement and retention. Most HCM systems are hosted on the cloud and follow the Software-as-a-Service (SaaS) model of deployment.

The HR function has come a long way from being known as the personnel department within organizations. From performing mere transactional tasks to taking on a more strategic role in the business, HR has seen its fair share of digital transformation. However, until recently, HR’s approach to digital transformation entailed multiple disparate legacy solutions “bolted together” through APIs and manual integration.

Why You Need an HCM System to Succeed in the Digital Age

With increasing pressure to rationalize costs and deliver value to the business in terms of hard-dollars, HR is now compelled to rethink its approach to technology. As intelligence and data become the cornerstone of successful human capital management, HR needs next-generation tools and technology to win in the digital age.

An HCM system is more than just a solution to manage core HR functions like payroll, time and attendance, leave management, and benefits. It allows HR teams to address fundamental human capital needs such as career management, skills development, talent acquisition, and build engagement. Most HCM solutions in the market today also offer advanced analytical capabilities, machine learning, and Artificial Intelligence (AI) features, providing HR teams with an unprecedented view into their organization’s current and future talent management needs. However, given the staggering amount of options today, selecting the right HCM solution for your business can be an overwhelming and exhausting task.

Selecting the Best-Fit HCM Solution for Your Business

Uprooting a legacy Human Resource Management System (HRMS) or a Human Resource Information System (HRIS) is a monumental task in itself, drawing significant scrutiny from C-suite and stakeholders across the organization. Therefore, it is critical that you list out your current HR pain points and expected business outcomes that a new HCM solution will address.

The next step is to complete a thorough evaluation of HCM vendors and solutions to identify an HCM solution that is best positioned to help your unique business needs. But don’t worry, you’re not all by yourself! We’ve created the ultimate guide to choosing a human capital management system that will simplify the HCM purchase decision for you. Whether you’ve just started on your digital transformation journey or see yourself as a strategic HR leader, TechFunnel.com’s Human Capital Management Buyer’s Guide with its unbiased, well-researched, vendor agnostic content will have useful takeaways for you.

In our HCM Technology Buyer’s Guide, you will learn:

  • What is an HCM system and how is it different from an HRMS and HRIS
  • How to decide between multiple “Best-of-Breed” solutions and a unified HCM system
  • Key benefits of an HCM system and how it can take your HR function from administrative to strategic
  • Top features to look for in an HCM system: the must-haves, the good to have, and value-added features
  • Our proprietary “Best of Tech” evaluation process
  • Comprehensive vendor and pricing details

Conclusion

Evaluating and choosing the best HCM system for your business is not an easy task. However, the effort and work that goes into making the right decision will affect your employees and your organization’s success. Know that this time will be well spent.

Khushbu Verma
Khushbu Verma
Khushbu Verma is the Senior Manager for Research Services at Bython Media, where she conceptualizes and develops research backed reports that help users build their technology stack. She has over 10 years of experience in creating data-driven research-based proprietary content like survey analysis reports, buyer guides, whitepapers, strategic account profiling, market insight reports, and competitor analysis. She has done her Master’s in International Marketing & Research from The Indian Institute of Planning and Management and Google Certification in Digital Marketing.
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