Digital Transformation Christopher SmithSeptember 29, 2021

8 Steps to Successful HCM Process Optimization

8 Steps to Successful HCM Process Optimization

HCM process optimization refers to the improvement of HCM-related software workflows.

Having an embedded, permanent optimization process can generate a number of benefits for the business. To generate tangible results from an optimization process, however, it is necessary to take a structured approach to process optimization, as we’ll see below.

8 Steps to Successful HCM Process Optimization

Here are a few necessary steps to follow when developing an optimization process for HCM workflows and procedures.

1. Clearly define your goals

The goal is the abstract aim of the optimization process.

Goals and priorities for HCM process optimization can include aims such as:

  • Shortening recruitment time and costs
  • Improving the digital employee experience
  • Decreasing HR costs
  • Reducing HR workflow errors
  • Improving HR staff productivity

Other goals include those that focus on the HCM platform itself, such as increasing software ROI. This goal, in turn, would be assessed through other metrics, such as those covered above.

2. Create objectives, KPIs, and metrics

Goals are translated into measurements – that is, objectives, KPIs, and metrics.

Examples of metrics include:

  • Employee productivity and time-to-productivity
  • Total hours dedicated to specific HR activities, such as recruitment or payroll tasks
  • Employee sentiment towards the HCM platform or specific workflows
  • The error rate for specific HR workflows

These metrics will be the central focus for the HCM optimization process, since they will gauge how effectively your HR platform is achieving its stated goals.

3. Design an optimization function

Next, it is necessary to dedicate resources to the process of HCM optimization.

In most cases there is no need to develop an independent business unit or hire someone specifically for this purpose.

Instead, it is often best to choose those from the most relevant departments, often HR and IT.

HR staff, for instance, can offer insights into HR department needs and the employee experience. 

IT, on the other hand, will be needed to perform certain technical tasks related to HCM optimization, such as the deployment of data collection tools.

4. Form a partnership with IT

Today, IT has become central to any business initiative that involves software deployment. In fact, many research firms argue that IT has become critical to many business strategies.

Any HR transformation program that relies upon digital technology, therefore, will need the support of IT.

As noted above, certain aspects of the HCM optimization process will rely on IT’s expertise. IT personnel will be required for tasks such as digital adoption planning, the setup of employee monitoring software, and other technical duties.

5. Use process and task mining tools

Process mining refers to the collection of backend software data in order to better understand and analyze that data. 

In most cases, process mining tools are used for business process management, optimization, and redesign.

Task mining is another example of an employee monitoring application that can be used for HCM process optimization. Like process mining tools, task mining tools collect data, only they collect information from front end workflows.

The data collected through these tools can offer valuable insights into HCM workflows, employee training needs, and more.

6. Learn and use process mapping techniques

Process mapping, as the term suggests, uses visual “maps,” or diagrams, to graphically represent business processes.

Flowcharts are one well known example of business process maps. Others, such as swimlane diagrams, can offer deeper insights into a business process.

These types of business process maps can help managers understand processes in detail, including key elements such as resource usage, costs, and so forth.

7. Leverage other data collection mechanisms

As mentioned, process and task mining tools can be very useful for collecting data on HCM processes.

There are, however, many other ways to collect data that can offer insights into how an HCM platform is being used.

Employee surveys are one example. Unlike quantitative metrics, employee surveys can offer qualitative insights into the human side of the HCM experience.

This can be useful for gauging, for instance, employee sentiment and employees’ attitudes towards the HCM program. Those surveys can also generate insights and ideas on how HCM workflows can be improved.

8. Map out and document the HCM optimization process

Just as the HCM optimization process is designed to map out and analyze HCM workflows, it is equally important to create a map for the HCM optimization process itself.

After all, process managers will need to continually optimize the HCM optimization process.

To that end, it will be necessary to perform many of the same tasks we have covered above, including setting goals, creating metrics, analyzing outcomes, and improving performance.

Final Thoughts

An HCM platform’s ROI depends on a wide range of factors, ranging from employee skills to the enterprise’s digital ecosystem to business process design. In order to maximize the ROI of your software investment, it is important to systematically analyze these factors and continually improve upon them. The steps above offer an excellent starting place. For more, see these articles on process mining, process improvement, and business process management.

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