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Summary

Human capital management (HCM) is a hot topic in the more traditional world of enterprise applications. Core HR capabilities have long been attached to enterprise resource planning (ERP) solutions and financial applications, but HCM brings a whole new opportunity for the enterprise, not least to further engage their employees, which in turn is expected to increase productivity.

Can HCM solutions really increase workforce productivity?

According to the ongoing poll on US employee engagement from Gallup’s Daily tracking survey, engagement is at a discouraging 34%. This means that 66% of employees in the US are not engaged with their organization, and therefore are not being as effective and productive as they might be. A similar percentage will apply across other regions.

Around 38% of organizations are planning to install new or significantly transform their HR/HCM capabilities in 2015, according to Ovum’s ICT Enterprise Insights survey. Core HR covers payroll, benefits administration, absence management, and so on, whereas HCM focuses more on aligning employees with company strategy, Within enterprises, many core HR systems are moving into “legacy” territory now, with a good percentage of organizations having multiple core HR systems as a result of various mergers and acquisitions. As such, enterprises are looking to invest in HCM to drive company strategy and also find the solution that allows them to gradually transition all HR/HCM capabilities onto one system.

HCM is not just HR for forward-thinking organizations. Most enterprises now have three or four different generations of employees, and attracting the right talent to drive forward a public or private sector enterprise is essential. The sort of talent that organizations want to attract in general does not want a mundane Monday-to-Friday, 9-to-5 job where they are tethered to their desk in an office. They expect, within reason, to be able to do their jobs when and where it is needed, with the right tools in place. For those of you who feel that this is unrealistic, how frustrating is it when our own corporate environments don’t match the consumer environments that we interact with every day? As such, today’s HCM solutions do a great job of engaging employees with company strategy, and employees who feel connected to the company are also expected to be more productive.

Appendix

Further reading

2015 ICT Enterprise Insights on Human Capital Management, IT0021-000044 (December 2014)

2015 Trends to Watch: Enterprise Collaboration and Productivity, IT0021-000042 (December 2014)

Author

Maxine Holt, Director of Research and Analysis, Software

maxine.holt@ovum.com

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