Human Capital Management (HCM) software is becoming increasingly popular. As of 2017, the market for HCM software was roughly 14.5 billion US dollars. By 2022, the market size is expected to expand to about 22.51 billion.
The shift towards automation and digitization of core information isn’t surprising – many things are moving in that direction. However, other aspects of HR have shifted focus in recent years, so these are driving the push for greater control over people related tasks and functions. Due to this combination of factors, the market for HCM software and other types of HR tech is experiencing a boon.
Employee Engagement a Driving Factor
Engagement is being increasingly linked to productivity and retention. Therefore, savvy employers across every industry have started to work on improving engagement in different ways. HCM software is a great way for employees to get connected and stay that way.
Many HCM software solutions allow employees to update their own personal information, view payroll data, request time off, and read up on company policies. Some solutions go beyond these basic options and offer peer-to-peer messaging, social news feeds, goal setting tools, learning and development management and other functionality. These options make it easy for employees to integrate into the company culture in a more comprehensive way.
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Automation and HR Efficiency
When HR professionals can automate tasks like time tracking, payroll, onboarding, report filing, and training assignment, it improves HR in several ways. First, these tasks become more efficient and less prone to errors. Second, HR professionals are free to focus on tasks that are more time sensitive and in need of a human touch.
For smaller companies, this may mean that a smaller HR department is needed – that more labor hours can be devoted to tasks that impact the bottom line. For larger companies, this may mean that HR professionals don’t need to be bogged down doing repetitive tasks, they can be working on recruiting or improving current systems.
Recruitment and Hiring Standards
HCM software can be used to assist with recruitment. The software can be used to source candidates, posting job openings quickly to multiple sources. Once resumes have been received, the software can help to parse them, bringing the most qualified applicants forward. HR professionals and hiring staff can then spend time with the best of the bunch and potentially raise hiring standards while still improving time to hire.
Large Enterprises Fueling Market Growth
HCM software is helping companies of every size, but large enterprises tend to be fueling the growth of the market the most. Large enterprises have more employees to keep track of, so the software saves time by helping to avoid double data entry and redundant tasks. Large enterprises may also have more capital to devote to improvements and new technology.
Global Investment in HCM Software
Regions such as the United States, Canada, and the United Kingdom have already seen HR software rise up as a preferred way of managing people. The Asia Pacific region, including Japan, Singapore, Australia, and China is expected to drive the HCM software market growth for the next few years.
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