It would seem that during a crisis there is no time to think about additional personnel costs. On the contrary, it is necessary to cut costs. But each medal has two sides: on the one hand, there is a massive staff reduction, and on the other hand, there is an equally acute problem of retaining top employees.
After all, the crisis is not eternal, and sooner or later business expansion will begin again. And then the loss of experienced, qualified employees will have an enormous impact!
That is why you should by no means forget about programs to increase employee loyalty. Automated personnel management systems – HRM-systems – help to put them into practice at the lowest cost.
Nowadays, when a number of industries are sharply increasing competition, top managers of enterprises have to constantly look for new ways to improve efficiency, new resources to create a competitive advantage of products and / or services.
With a constant shortage of qualified personnel, the most important method of competition is not only to attract new decent employees, but also to retain the old, increasing their loyalty to the firm, the constant growth of their skills.
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Automation of Personnel Management
So how can we achieve these goals without significantly increasing the staff of human resources departments? Automated personnel management systems come to the aid of entrepreneurs. As a matter of fact, the demand for them arose quite a long time ago.
But if before, they were mainly used for personnel records and payroll, then now their functionality is expanding significantly in the direction of labor management. And the demand for these functions is growing not only among huge production holdings, but even among small trading companies, which have finally realized that the volume of sales substantially depends on the qualifications of salespeople.
Let’s briefly describe a few of the most popular HRM subsystems.
First of all, we should mention the automated assessment of personnel. It should be based on the description of each job profile from the staffing table (job profile is a basic component of the entire human resource management subsystem).
One of the components of the profile is a list of competencies selected from a relevant reference book. For each competence a normative assessment is placed, which a specialist needs to have to successfully perform his/her job duties, as well as a weighting coefficient characterizing the importance of this particular area of knowledge and skills.
In addition, the job profile includes a list of evaluation activities with an indication of the required frequency of the evaluation activities for the respective employees. Each evaluation can be carried out according to its own specific scale, which is also described in a special handbook.
Based on these data, as well as information stored in the employee’s personal card about the dates and names of the evaluations he/she passed, a list of employees “sentenced” to each type of testing is automatically generated. This list can be adjusted from the keyboard.
After approving the list, you can start the actual testing of employees.
Test results on the competencies planned for assessment are transferred to personal cards. A special procedure makes it possible to compare the actual results with the normative grades indicated in the job profile and draw a conclusion about the job suitability of each individual employee.
It is obvious that this functionality allows not only to reduce the labor intensity (and hence reduce costs) of assessment activities, but also to increase their frequency, maintain the necessary regularity and, consequently, increase the average degree of compliance of employees with the position in the enterprise as a whole. In an environment where “human resources are everything,” this effect is very significant.
This functionality is also extremely useful in the downsizing process. It helps you make the right decision about who to fire and who to retain at all costs.
Another group of functions allows you to plan the retraining and training of staff. For this purpose, the job profile describes the training regulations: the necessary training programs (they are selected from the appropriate directory) and the frequency of their completion.
Then, similar to the list for evaluation, a document of training needs is automatically prepared. It is good if the system, in addition to personnel who have already reached the planned deadline, allows you to include additional employees at the request of the heads of departments.
Since the same training programs can be conducted by different institutions, the system usually maintains a directory, which contains the name of the institution, the price of training, the duration, the course capacity and the training program that is implemented through it. Based on this directory, the program can automatically enroll employees in courses. This is how a training plan is created.
Since the cost of training at each institution is known, the developed HRM-system allows you to choose the best option in terms of cost distribution of employees, as well as compare it with the budget for staff retraining.
All approved training plans are distributed on the personal cards of employees. All approved training plans are distributed to employees’ personnel cards.
It can be concluded that the automation of training management also has a positive effect on the degree of compliance of the company’s employees with their positions through the timely retraining of personnel. In addition, automated selection of educational institutions allows to reduce training costs.
Continuous retraining is essential not only for high-tech companies that are constantly improving their production processes, but also for trading companies that sell more and more new types of goods – because a thorough knowledge of the product undoubtedly increases the volume of sales.
One well-known way to increase employee loyalty without an additional increase in payroll is career planning: the clearer each employee’s career prospects, the less likely it is that he will want to change jobs.
Automation of career planning in HRM-system is based on the already mentioned functions of planning of retraining of employees and assessment activities, as well as with the help of functions accounting personnel reserve.
Part of the workforce management functions is related to the planning of recruitment campaigns (recruiting). Perhaps this subsystem is not as relevant in the crisis era, but then again, crisis is not eternal.
The staffing table automatically determines the need for personnel recruitment. It includes vacant and newly created staff positions.
The system allows you to maintain candidate cards, which are an extended analogue of personal cards. They additionally contain information that is relevant only at the “candidate” stage.
The system produces a list of candidates for each selection position, based on the job profile code entered into each card by the hiring manager. The need for an employee can be met not only by external candidates, but also by internal candidates, since the software includes functions for accounting the personnel reserve. A roster of resumes is maintained.
In addition, recruitment activities are planned (placing advertisements in the press, on job sites, etc.). Each such event is characterized by its costs and time duration. The planning process determines what specific activities will meet a given need, the date and cost of each activity, as well as the expected number of candidates for each recruitment position as a result of its implementation.
After each event is completed, the planned costs are compared to the actual costs and its effectiveness is determined based on the information stored in the database about how the desired candidate was attracted.
It is easy to see that the automation of recruiting can improve the quality of recruitment, as well as optimize the cost structure of this process, for example, by including the most effective recruitment activities in the plan (this is possible only after accumulating sufficient information on previous campaigns).
The next group of functions is designed for motivation management. This functionality is necessary if the company has a system of various bonuses and incentives, which depends on certain formalized conditions, for example, on the length of service at the company or on the successful completion of the certification. The algorithms for granting bonuses are also described in the job profile.
This also includes everything related to piecework remuneration. For this purpose, the position profile describes a set of measurable indicators that allow you to automatically bonus an employee for meeting the plan, put his wages in dependence on the output (both personal and brigade) or sales volume, etc.
The price of the indicator can be set as a fixed amount per unit of work performed or as a percentage of the volume if this volume has a monetary value. This part of the functions must be tightly linked to the wage calculation subsystem.
It is obvious that the automation of motivation management leads to increased productivity of the team. Many people know in practice how the situation in the company can change dramatically due to the proper organization of piecework pay. No less effect can be achieved by a balanced system of intangible incentives.
And if you maintain a complex system in “manual” mode, it is easy to get confused, to forget to provide this or that bonus in a timely manner, or to accrue bonuses incorrectly, which often leads to conflict situations.
The staff scheduling functionality has been in great demand lately. Employee monitoring system allows you to prepare several variants of staffing schedules for each division, compare them and choose the optimal one. The program should support the procedure for approving the staff schedule. The database, as a rule, stores the history of each staff unit. It is good if the software has a built-in staffing schedule modeling apparatus based on the “what if” principle.
In many cases, the optimization of the staff schedule can significantly reduce the payroll, which is one of the main items of production costs.
Another aspect of the “crisis” use of HRM has nothing to do with employee retention. On the contrary, it is related to the reduction of personnel costs.
In times of crisis, some companies switch to shorter workweeks or move employees to part-time pay. The system allows you to automatically change work schedules as well as to change salaries centrally for all employees in the company, for a selected category, and individually.
And in general, the introduction of an HRM system can dramatically improve the productivity of staff and accounting departments, which also leads to a reduction in staff costs.
I have not described all the functions of a modern HRM system that is a full-fledged monitoring software for employees. Nevertheless, one more conclusion can be made, which is the main one in my opinion.
In addition to the above-mentioned effects of the introduction of software, we can confidently say that the use of information technology can significantly improve the production atmosphere at the enterprise and reduce employee turnover, which in today’s business is the most important success factor.