The Four Measurements of an HR System that Works

What this episode covers

Automation can make HR processes run smoother, saving organizations time and money, and helping them avoid costly mistakes. However, it’s important to note that an automated HR system doesn’t replace the human element of HR. Rather, the goal is to unify all the employee life cycle events and components so your HR staff can focus on nurturing the people in your organization. You know, the human part of human resources. Automated systems have obvious tech aptitudes, like automatically flagging missing social security numbers on insurance forms, but they can also benefit attitudes. Employee motivation levels change every day. Furthermore, motivation is not achieved by giving out a bonus or throwing a party at the end of the year. It has to be nurtured every day through consistent, positive interactions with all team members. Automation helps keep processes consistent, allowing your HR team to focus on improving the employee experience around life cycle events and HR systems. In addition, employees are more apt to be motivated to perform in the workplace if they don’t feel bogged down by tedious, time-consuming, and often confusing HR tasks. With an automated system in place to remove the drudgework, HR staff can spend their time communicating and maintaining a consistently motivated workforce. Building an HR System That Works If your organization wants to implement an automated HR system, one of the main questions you’ll want to answer is: What makes for a good system? HR systems that fuel a productive and satisfied workforce have four components: efficiency, scalability, reliability, and compliance. Let’s look at each one. Efficiency Whether the system is payroll, benefits, reporting, compliance, or timekeeping, it needs to be effective. The goal of most HR systems is to generate action. In a compliance system, for example, you’re trying to teach employees something specific. In a benefits and compensation system, you want to communic  ate that the employee is appreciated and well compensated for their work. Scalability It’s imperative to scale your system to match organizational needs. In other words, HR processes need to grow with your organization in a way that doesn’t cause undue burden to any party or add time to employee life cycle events. Improving scalability by putting more time and effort into how something is done allows a higher return in the form of a productive and dedicated staff. Reliability In addition to effectiveness and scale, HR systems must be consistent. Typically, managers will see things differently than employees, but it is critical for every manager to see, learn, or react in a similar way to the same situation. If the way employees interact with HR, and the organization, is unreliable, information will be disseminated by tribal stories or word of mouth—not a good scenario. Compliance HR systems must also be compliant and include only accurate information. To ensure this, modern HR systems have compliance checks to guarantee employees receive all necessary information related to policy and compliance changes. Those transmissions and specific details, then, are properly recorded. The Statistics Tell the Story Automating your HR system—and building one that works—contributes to your ultimate goal: you’ll be able to devote time to your company’s human capital and leverage employees’ workplace satisfaction into a competitive advantage. As most business owners know, it’s costly to replace an employee. What you may not realize is just how much this process can cost your organization. Take a look: It costs 16% of annual salary for high-turnover, low-paying jobs (earning under $30,000 a year), meaning it costs $3,328 to replace a $10/hour retail employee. It costs 20% of annual salary for midrange positions ($30-50,000 a year).