For many decades, human resources in companies and organizations have been a paper-based, file-driven system. The accumulation of paperwork, forms and information captured on documents made up the progression of an employee’s career until they leave the company for somewhere else or retirement.
However, up until probably the early 2000s, much of that information captured was also connected in a disparate collection of folders in different offices. There was the salary and payroll folder, the benefits folder, the training and development folder, the pension or retirement account folder and so on. Not until enterprise systems became accessible to medium and smaller companies did HR offices actually start to create something close to a network of databases for their employees.
Today, the modern HR office has come a long way from those wagon train days. Both the Internet, digital development in the cloud and employee portfolio strategies have made a big night and day difference. And some of the most dramatic changes have occurred only in the last three or so years thanks to a pandemic forcing everyone to work remotely from computers for a few years.
Modern Changes Come Quick
One of the biggest HR services impacts of the pandemic was a systemic move away from the old form approach. Forced distance means people have to embrace the Internet versus keep fighting. That has produced a huge sudden push in three arenas: cloud documents, digital signing, and web-based form intake.
All three share the same commonality, the capture of information digitally, which can then be transferred into databases and used to populate HR records in HR software. Of course, it’s not as easy as it sounds; personal private information, for example, created huge challenges that had to be met for data security alone. Previously, that was a cost barrier. However, once the digital world became a necessity, the protection came fast and furious.
Removing Silos
As noted before, HR functions have been famous for siloing employee information, with almost a ridiculous amount of bureaucracy involved. Very modern services, however, have moved away from this paradigm and instead towards portfolio management. Rather than silos, the entire HR community works within a protected biome, sharing and leveraging different information segments to create a symbiotic whole.
The result ends up being comprehensive employee management, including everything from a person’s salary payroll history to their pathways for training development, team potential and overall career goal targets. And now, with the combination of automation and AI systems, predictive services are beginning to have an influence as well.
Going Financial
Another big area that was taboo for HR in past decades has now become embraced – finance. Labor is probably the biggest cost factor for a business that has anything more than a micro-sized operation. There is only so long a company can go with contractors before it needs onboard employees. Once that happens, the payroll factor starts to increase, along with everything it brings in related expenses too. Managing the financial impact of labor accounting, however, has frequently been relegated to the payroll shop alone and accounting. Now, other sides of HR are getting in on the act, understanding the financial impact of personnel decisions, and integrating financial analysis in HR strategy going forward. It is a tremendous game-changer in personnel management.
Adding in the analysis of finance with personnel decisions ties down their cost/benefit impact as well. It requires technical expertise that can leverage both the accounting records and the personnel data, synthesizing the information in strategic decision recommendations based on labor. Companies have been doing this exercise for years, but it always required input from two different houses in the company: HR and accounting. Now, the modern HR manager is weighing in with both independently. How is this possible? Integrated data systems also help HR managers see the whole picture of an HR path, including the cost impacts as well as possible predicted gains.
Cloud HR Works for Everyone
So, is there plenty to be gained by considering HR support online and through today’s cloud opportunities? Absolutely. Any business can leverage modern HR today, even startups and small businesses focused on their product and unable to staff up HR internally.
