If the machines really are taking over, nobody’s informed HR
Let’s face it, HR-related tasks have always haunted us with a nightmare forged in paperwork, red tape and files of records so vast, we sometimes feel as though we’ve wandered into the warehouse scene at the finale of “Raiders of The Lost Ark.” That’s probably why staffing professionals tirelessly champion automation technologies that can streamline and optimize workforce processes: social media, vendor management systems, applicant tracking systems, emerging freelancer management systems, online recruiting platforms, people analytics, Big Data, diversity assessment and inclusion tools, contractor compliance software, and even recruiting apps retconned from online dating services.
So given this exhausting list of options, it’s crazy to learn that 48 percent of traditional HR leaders and hiring managers still use manual methods (yes, even paper and pen) to handle their talent needs. If this picture looks a lot like your organization, it’s an excellent time to consider engaging an MSP.
The 60s are over: today we boot up, plug in and connect
While some retro-chic, counter-culture hipsters may still tell you to turn on, tune in and drop out, it’s not going to help you reach the enlightened talent management satori you’re seeking. Success in this century requires remaining connected and online. It seems nearly impossible these days to have a conversation about recruiting and employment that doesn’t funnel directly into discussions of technology. Yet according to Software Advice’s recent “Human Resources Software BuyerView 2015” report, “Nearly half (48 percent) of buyers currently use manual methods, such as pen and paper or spreadsheets, to handle their HR needs, while 32 percent use dedicated HR software.”
Here’s a snapshot of the prevailing methods that Software Advice uncovered in its study.
For startups and small businesses, manual processes may not seem that problematic. Because these enterprises must remain incredibly conscientious about their overhead costs, purchasing HR automation systems might not be a budgetary consideration. In reality, however, HR analytics software helps smaller businesses save critical funds by facilitating smarter hiring decisions, which bolster return on investment. And as these businesses grow, reliance on manual processes can create more problems than solutions. For companies with a substantial employee base, the troubles only increase.
- Entering data by hand is time-consuming and cumbersome, which becomes a financial drain on the organization — especially when multiple departments are tracking their recruiting efforts in this manner.
- Of course people are better than machines, yet they’re also more prone to errors. Calculating time and attendance through spreadsheets, or attempting to run payroll, can result in expensive mistakes. As Software Advice points out, the American Payroll Association estimates that errors from manual processes cost companies one to eight percent of total payroll.
- There’s also the issue of security. A few dire stories in the media would suggest that security vulnerabilities are the realm of servers and cloud-based systems. Some isolated incidents shouldn’t taint our view about how effective the security factors are for these technologies. They’re a lot safer than a password protected Excel sheet, which can be hacked by anyone through countless online tools and resources, exposing sensitive employee data to higher risks of tampering.
The big need for big data
“Looking first at those using manual methods,” Software Advice writes, “the biggest pain points are improving efficiency and organization (44 percent) and automating HR processes (22 percent).” Although the desired functionality varies by audience, personnel tracking ranked at the top. For HR, the biggest automation needs Software Advice found were:
- Personnel tracking
- Performance reviews
- Time and attendance
- Learning management
- Applicant tracking
- Job posting
- Resume/CV attachment
- Candidate feedback
- Interview scheduling
- Candidate searching/sorting
- Resume/CV parsing
- Candidate portal
- Mass email
- Screening questionnaires
Perhaps the most surprising discovery in Software Advice’s research involves the types of companies looking to move beyond their manual processes. You’d typically expect this sort of decision from a larger organization or one experiencing explosive growth. Yet the push is coming from small and mid-sized enterprises. Companies ranging from one to 250 employees account for 60 percent of the respondents looking to automate.
Workforce technology: the bonus prize for hiring MSPs and staffing curators
Remember the excitement you felt as a child while digging out the prize from a box of Cracker Jack or Captain Crunch? Or when, in college, you found your roommate’s loose change in the sofa cushions? As an HR or hiring manager, you can relive those joyous moments again through an MSP. When you outsource your recruiting and talent management efforts to an MSP, there’s almost always an extra prize waiting for you: HR automation technology.
MSPs and their staffing partners possess superior working knowledge of the market-leading systems. Their professionals are adept at generating reports, analyzing data and producing mission-critical business reviews for program performance. Hiring managers may not have the experience or time to utilize the systems to their fullest extent in satisfying core business objectives. MSP teams also have systems administration knowledge, allowing them to easily configure the tools, adjust privileges, administer users and produce ad hoc data.
At their core, VMS systems offer an end-to-end technology solution capable of managing all non-employees globally, strengthened by rich workforce analytics and reporting tools. They allow clients to build a policy and technology infrastructure that supports the communications, collaboration, controls and visibility necessary to effectively oversee a contingent workforce:
- Program and policy design
- Master contract terms and pricing
- Individual labor requisitioning
- Time tracking and approvals
- Invoice consolidation and reconciliation
- Supplier and laborer performance measurements
And they’re evolving to integrate with other critical workforce technologies. Leading VMS infrastructures no longer limit their focus to staffing partners and their talent — they now incorporate automated processes for handling freelancers, online recruitment, direct-hire applicant tracking, Statement of Work (SOW) and services spend, independent contractor compliance and administration, social recruiting media, and more.
Purchasing internal software, along with the databases and servers required to maintain it, can be cost-prohibitive for smaller firms. However in an MSP/VMS program, they receive a robust business analytics solution to manage their teams, their talent, their accounts receivable and payable, their operations and their margins. The system tracks, among countless other things:
- Number of calls required to connect with candidates
- How many connections are required to qualify candidates
- Submittal-to-interview ratios
- Percentage of offers accepted or declined
- Percentage of placements that start
- Retention and turnover rates
- Assignment data
- Performance scorecards
- Screening results
- Placement rates
It used to be that sufficient volumes of spend were required to justify a managed services solution — that cost efficiencies could only be attained for programs in excess of 100 temporary workers and more than 10 staffing companies. Yet as we noted in August, progressive providers are launching “MSP/VMS Light” programs that are tailored to meet the needs of smaller businesses — the very organizations aggressively seeking an automated HR solution, according to the Software Advice study. And because the majority of MSP/VMS programs use supplier funded models, clients receive HR technology and the staffing experts to run it without incurring the financial burdens of a self-managed program.
The modern workplace is changing. New philosophies of management and new approaches to the very nature of work are being introduced. Workers themselves are changing. And all of this ties into technology. Today’s talent stand at the epicenter of the changes that are shaking up industries, business strategies and employment initiatives. The growth of generations Y and Z has signaled a dramatic demographic shift, bringing workers who are more connected to the world and their communities through an expanding digital ecosystem. During the next five years, Millennials will occupy 46 percent of the entire workforce. By 2025, they will have risen to become the uncontested majority at 76 percent. And it’s difficult to deny that these dynamics are heavily influenced by and linked to technology.
Because talent today have such an affinity for online interactions and digital socialization, Google has dubbed them Generation Connected. This young breed of talent represents the best in breed leadership of tomorrow. Manual processes will likely be an alien concept to them. The technology that will support the workforce they create already exists, and engaging an MSP/VMS is the best way to seize that future today.
This article was syndicated from Business 2 Community: HR Desperately Needs A Technology Makeover
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