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These days, many HR departments use Human Capital Management (HCM) platforms as a way to keep track of and manage all employee details. Intended to make life simpler for HR departments and employees alike, HCMs seem like a great idea. Unfortunately, in many instances, HCM platforms aren’t delivering the value companies expected and, in fact, might even make the situation more complicated — and employees less happy as a result. Are human capital management platforms too hard to manage? Good question, let’s take a look.
Employees Aren’t Happy In General
First, it’s important to note that recent studies show many employees are unhappy at work. In fact, the “quits rate”—which is the rate at which employees quit their job—is at an all-time high of 15 percent. And that rate has been growing steadily every year since 2010. Other research shows that some 82 percent of employees are disengaged — which means they are showing up, checking the boxes, but not really engaged, either with the company they’re employed by or the work they’re doing.
Why is the turnover rate so high? Top talent is not easy to find, and it’s also not easy to retain. Why? There’s more competition for talent in the workplace than ever before, and that shows no signs of decreasing any time soon. Also: Stress. People are working more and longer hours, feeling more stressed, and sometimes underappreciated. Employees are often less productive and definitely less happy as a result. It’s easy to see why more people than ever are disengaged, distracted, and constantly on the lookout for a new, better job.
How HR Has Been Trying to Help
For both recruitment as well as retention efforts , HR departments have been trying to help. That means adding more perks to benefits packages and offerings in an attempt to stay competitive. Many companies now offer not just health insurance and paid time off, but also things like fertility benefits, student loan payoff assistance, improved retirement benefits, and more of a focus on overall well-being in the workplace.
HR departments have also been spending money on technology offerings that they think will help. One example involves Human Capital Management platforms, which are supposed to make it easier for the HR department and employees to track everything from benefits to time off requests, to performance reviews. While most HCM platforms are an improvement over the old method of using multiple tracking tools that didn’t communicate with each other, they’re still not ideal.
Why Human Capital Management Platforms Aren’t Helping Very Much
The point of using Human Capital Management platforms is to keep all information about employees in one place, so it’s easy for both HR and employees to view and adjust as needed. Previously, HR teams would have to use several platforms to manage everything from payroll and employee benefits packages to time-off requests and job benchmarking. Now they have technology, in the form of human capital management platforms, to keep track of everything all in one place.
However, as is often the case when it comes to companies embracing digital transformation, technology alone is rarely the answer. In this case, and in far too many instances, human capital management platforms aren’t as effective as hoped. Sure, they can hold a lot of information, but they’re often not at all easy to use. As a result, HR departments all over the world have invested in a technology solution that’s difficult to figure out, difficult, and sometimes frustrating, to use, and widely not adopted as a result.
And the fact is, we know the companies that make human capital management platforms can do better. After all, some of the most popular systems today—such as Facebook and Amazon—are extremely complex on the back end, but manage to be very simple and easy to use on the front end that users see. So why can’t human capital management platforms be the same way?
More specifically, we need an employee experience platform. What is that, and how does it compare to the typical human capital management platform? Read Part Two of our series to find out!
Futurum Research provides industry research and analysis. These columns are for educational purposes only and should not be considered in any way investment advice.
More sources on HR problems and solutions:
The Digitally Transformed Workforce: How to Upskill and Retrain to Retain Talent
Blockchain’s Impact on HR and the Future of Work
Using the Power of People Analytics to Transform the Future of HR
Author Information
Shelly Kramer is a Principal Analyst and Founding Partner at Futurum Research. A serial entrepreneur with a technology centric focus, she has worked alongside some of the world’s largest brands to embrace disruption and spur innovation, understand and address the realities of the connected customer, and help navigate the process of digital transformation. She brings 20 years' experience as a brand strategist to her work at Futurum, and has deep experience helping global companies with marketing challenges, GTM strategies, messaging development, and driving strategy and digital transformation for B2B brands across multiple verticals. Shelly's coverage areas include Collaboration/CX/SaaS, platforms, ESG, and Cybersecurity, as well as topics and trends related to the Future of Work, the transformation of the workplace and how people and technology are driving that transformation. A transplanted New Yorker, she has learned to love life in the Midwest, and has firsthand experience that some of the most innovative minds and most successful companies in the world also happen to live in “flyover country.”
