The desire to invest in talent management systems often aligns with two needs of a business. Firstly, a better educated and more engaged workforce is more productive and achieves greater results. Secondly, an organization's people are its core asset for delivering corporate and financial goals.
The workforce is one of the biggest expenses of an organization, and getting a return on investment on that scale of expense is critical for financial performance.
Talent management tools provide a number of ways to enhance sourcing and recruiting, performance and people development, as well as retention and engagement. Here are some of the key drivers that will help businesses understand their needs and help build the business case for investing in talent management software.
Human capital development
Development of an organization's human capital -- people -- has a number of big-picture benefits. Talent management systems support organization development in many different ways. Talent management software enables managers, teams and employees to focus on the right goals of the organization and work towards larger corporate goals by tying development objectives and performance targets to those corporate goals. Such software provides structure and automation to employee development planning, training and enterprise learning.
Talent management tools provide ways to develop successors of incumbents in key positions, thus providing protection for the roles that drive the most value to the business. To review the development plans and performances, talent management software often provides cross-suite analytics, helping businesses make informed decisions about their talent and their goals.
On top of the benefits of employing talent management tools, using a cloud-based talent management system has its own rewards. Cloud talent management systems can be cheaper to maintain because there's no hardware. They can integrate more easily with other systems compared to an on-premises system, so a business doesn't have to rely on specific vendors. Cloud technology also has regular releases or updates, which can provide constant innovation to a business's talent management system and process.
Organizations are typically driven to implement talent management systems because they are looking at taking their organization to the next level. Expansion can result in a business outgrowing its existing systems or processes. Another driver for procuring talent management software is that, over time, a business can acquire a series of disjointed talent management systems or can reach a critical size where structure is needed to formalize talent management processes and structure them using software. Organizations may also look to talent management systems to increase the productivity and performance of their workforce or to act simply as part of a larger HR or digital transformation.
Typically, a talent management investment will repay itself within two to three years as the efficiencies, productivity, reduced hiring costs and better-educated workforce drive business value and profitability. For example, various studies have shown that better recruiting and onboarding leads to greater retention of new hires -- many newly hired employees make a decision to stay or leave within the first six months -- thus reducing turnover and hiring costs. Additionally, retention builds continuity and engagement, which, in turn, could lead to greater productivity and profitability.
Tying together disjointed HR software
One of the challenges faced by many organizations is having multiple software programs running their talent management systems -- or, in some cases, multiple spreadsheets. Implementing a talent management system to replace multiple, disparate systems and processes provides several benefits. The main benefit is that, because all processes are in the same place, the data is in the same place, creating a single source of truth. Talent management systems also standardize data and processes and can execute a talent management strategy globally across an organization. Reports and analytics are consolidated, and version control is smoother. These reports allow employers to audit decisions. A holistic management system increases the security of personal and sensitive employee data because the data isn't bouncing from one application to another.
By bringing together multiple systems and removing spreadsheets, organizations can run an integrated set of holistic talent management processes across the entire workforce.
Seeking specific talent management features
Organizations may wish to buy only parts of a talent management suite for specific features they want, or they may implement an entire talent management suite because it can integrate well with an existing human resource information system or a similarly functioning system (e.g., background checking applications or a course content provider).
For example, an organization's primary need may be in attracting and retaining talent. For this type of challenge, one would need to look at a talent management system that offers modules for recruiting, onboarding and possibly career development planning. While getting hold of a good system for managing these processes is very helpful, it would behoove the business to look at the remainder of the suite so that, if it moves further with its talent management initiative, it can leverage other products in the suite and create a holistic integrated set of processes.
Sometimes, however, it's not always the bigger modules or features that offer the benefits of an integrated system. Sometimes, the differentiators between a system that meets the needs of a business and one that does not can be the smaller features, such as embedded analytics, chatbots, job description management, competency management and talent review meetings.
Additionally, solid talent management systems will help organizations with the age-old issue of employee engagement. Motivating and engaging employees go beyond technology, but having the right technology to support this is important. When accessing these systems periodically, employees are looking for an easy-to-use and engaging interface, as well as processes or features that are simple and require fewer clicks. A forward-facing talent management system is important in that it shows an employee that the business is serious about how it goes about developing its people and their careers.
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