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Many roles make up an HR department, but if you want your HR department to be a strategic leader, there are a number...
of key human capital management functions you should be looking at.
Here are the eight human capital management functions that I consider to be the most important today.
1. Employee engagement, experience and retention
In recent years, nothing has shown greater importance to organizations than employee engagement. Fostering employee engagement is proven to lead to higher retention, improved productivity and greater profitability. Among all human capital management functions, employee engagement harmoniously interweaves with other core HR functions to define and implement strategies, processes and programs that will engage employees, motivate them, make them feel rewarded for their contributions and improve their overall experience.
But it doesn't just include employees. The candidate experience is the beginning of an employee's journey with your organization and sells your brand to employees before they've even begun. The onboarding that follows bridges the experience between candidate and employee.
2. Training and career development
Tying into employee engagement and retention are training and career development. Employees -- particularly millennials -- see training and education as key parts of advancing their careers. Millennials see career development and progression as must-have aspects of their employment, and acquiring additional skills and education is a critical part of this. Mentoring programs are also popular among employees who are keen to learn more.
In addition, organizations that undertake succession programs direct a significant part of their training and development programs to develop the next generation of leaders.
3. Continuous performance management
As traditional performance management has faced some criticism in recent years, continuous performance management has become more popular as a way to measure performance and guide employees to continuously perform to their maximum potential. While annual appraisals are typically based on past performance, continuous performance management enables ongoing feedback that helps keep employees on track and avoids course-correcting struggling employees only once or twice per year.
4. People analytics
In the HR world, implementing a people analytics strategy is like winning the Super Bowl or the World Cup: It is the dream of every team, but few are able to achieve it. People analytics can improve HR effectiveness by providing insights into trends and characteristics of your workforce that enable smarter and more effective decision-making in HR programs. You can take advantage of people analytics to remove bias, minimize flawed decision-making and gain a holistic view of your workforce and its behavior.
5. Contingent labor management
The use of contingent labor -- better known colloquially as the gig economy -- has become prominent for employers in the 21st century, either as a way to find talent for a short-term assignment or to augment staff when there is a shortage of skilled employees available in the market. While much of the hiring and contracting of contingent labor is managed by the procurement department (should one exist), certain aspects of managing these workers are a responsibility of HR. Onboarding contingent workers to their team, assigning mandatory training courses and transitioning contingent workers to full-time employees are just some of the areas where HR must have processes and strategies in place to manage these workers.
6. Artificial intelligence, machine learning and robotics
Artificial intelligence, machine learning and robotics are developing rapidly, and AI and machine learning in particular are already being used in HR applications. Chatbots and diversity features are already adding intelligent interactive capabilities that learn as you use them, and managing this technological evolution should be one of the top-priority human capital management functions of any modern HR department.
Identifying software that uses these capabilities and managing its ongoing use can add value to the user experience for employees. Among the possible applications are recruiting chatbots and voice user interfaces that enable employees to ask questions to your core HR software about such things as their leave balance and which colleagues have certain skills.
7. Diversity and inclusion
Two other hot topics in today's HR, diversity and inclusion, blend legal compliance with a desire to promote equality and make the organization a place where individuals feel safe and comfortable with being themselves, can celebrate their differences and know that their contributions to the success of the organization will be recognized. This combination makes diversity and inclusion some of the most important human capital management functions.
Diversity and inclusion also provide a sense of well-being for employees and help to support employee engagement.
8. Data privacy and protection
Data privacy and protection have become increasingly important, no less so for companies that operate in the European Union (EU) or in countries with data sovereignty laws, such as Russia and China. With the General Data Protection Regulation recently coming into force in the EU, organizations that have employees in the EU must have specific policies and processes for managing employee data and must understand how the law applies to them with regard to data collection, processing, storage and retention. Engaging a data protection officer is essential for protecting you and your employees' data.