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A human capital management system (HCM) helps organizations track the employee lifecycle, from hiring to offboarding. HCM software streamlines tasks such as onboarding and payroll, and when used correctly, enhances the workforce experience and supports employee engagement.
While HCM tools have great potential, businesses must implement them correctly to maximize their benefits.
Proper implementations require careful planning and configuration, as well as access to rich data on current processes. And when companies don't take an organized approach to implementation, even the best HCM software can fall short of its proposed offering. In worst-case scenarios, poor implementations can even lead to payroll and other business process errors.
Here, learn how HCM implementations work and how to avoid common mistakes with best practices and a step-by-step guide to successful human capital management software adoptions.
HCM implementation explained
HCM implementation is the process of planning, configuring, deploying, and adopting a human capital management system across an organization. This implementation involves the input of stakeholders from the HR and payroll departments and affects services like benefits administration, talent management, compliance, and reporting.
HCM implementations rely on cautious, well-planned workflow and data migrations, which allow the new tool to streamline business processes and boost productivity for payroll and HR functions. Successful implementations improve the employee experience, as team members can rely on consistent payments, accurate benefits and tax withholding, and (in some cases) user dashboards that allow them to visualize their pay stubs or generate straightforward requests, like for time off.
Why HCM implementations are complex
HCM systems have far-reaching benefits within an organization that not only impact core business functions but also the employee experience. Due to the extensive reach of this tool, implementations are uniquely complex. Here's how.
- HCM software houses core processes like payroll and benefits administration: HCM configurations must be exact and run on clean data, seeing as the system will process payroll and determine tax withholdings and benefits applications. HCM software also generates reports and performs performance analytics, which are essential to strategic business decisions—from budgeting to workforce planning.
- Regulatory and compliance requirements increase risk: HCM implementations require compliant, secure data handling, in line with governmental regulations. Plus, implementation teams must keep clear records, even during this period of transition, so that they're always prepared for an audit. Finally, many of these tools have built-in, AI-driven automation features that, while efficient, can generate errors if humans don't perform due diligence on the accuracy of processes and data.
- Achieving buy-in can be difficult: While HCM software saves teams work in the mid- to long-term, it comes with a learning curve. When users don't receive adequate training or information on the platform's value-add, they may revert to performing obsolete processes or creating workarounds to avoid interacting with the HCM system. These moves generate manual entry errors and data inaccuracies, and prevent the HCM software from acting as a reliable, single source of truth. Plus, when errors lead to problems with employees' pay, benefits, taxes, onboarding experience, and so on, the workforce can lose faith in the platform.
Successful HCM implementation steps
Navigate the complexities of implementing a human capital management system by following these ten steps.
- Set the scope, goals, and success metrics: Determine what processes the HCM system will run and how they align with overarching business goals. For example, if you aim to improve the employee experience by offering faster, more accurate payments, automating payroll is a core objective for your implementation. Define the KPIs you'll use to track success. In this example, you might track employee engagement scores pre- and post-implementation.
- Identify stakeholders and establish process ownership: Gather key stakeholders from HR, IT, finance, payroll, and leadership to form part of the HCM implementation project team. You'll also want to involve select end-users in the process, as they can provide useful first-hand insights on how the platform could best integrate with daily work. Once you've established the project team, delegate ownership of key implementation steps, like who will be responsible for mapping the current onboarding or payroll workflows.
- Map current HR workflows: Implementation teams must be able to visualize current workflows in order to improve upon them and configure them to the HCM tool. Scribe Capture automatically transforms current processes into user-friendly, step-by-step guides that leaders can use during implementations to study existing workflows, pinpoint inefficiencies, and maximize areas of opportunity with the HCM software.
- Design the future-state processes: After mapping current processes and understanding the bottlenecks and redundancies within them, design future-state workflows for the HCM software that eradicate these issues. When designing, consider the capacities of the new tool, ensuring that you fit processes to its configurations—instead of creating future processes that the HCM system can't execute or trying to reconstruct current workflows “as-is.”
- Prepare data for migration: Before data migration, clean up existing data, which may be incomplete, contain inaccuracies, or be stored in varying formats (i.e., spreadsheet data vs. data housed in legacy software). The HCM system relies on legible data to correctly execute processes, and running workflows on erroneous data can generate major errors, like incorrect payments or faulty tax compliance.
- Configure the system: Set up the HCM software to run your business processes, customizing workflows and fields to support daily work. Foster maximum data security by also establishing approval hierarchies, access permissions, and user roles (who can enter or modify which parts of the platform). Finally, ensure that the HCM system integrates with other tools you currently use and from which it needs to pull data, like your time-tracking software or your ERP platform.
- Test end-to-end workflows with real scenarios: With the help of real end-users, simulate everyday workflows to ensure they're intuitive and functional. Take user feedback seriously, modifying the configurations as needed to support more agile work.
- Perform role-based training: Have area leaders train their direct reports in using the HCM system, demonstrating workflows with real-life examples. Enhance the learning process by using Scribe Capture to document new processes in the HCM software in user-friendly guides that people can follow during training and reference after the fact.
- Go live with a stabilization plan: Launch the implementation company-wide, following a careful stabilization plan (routine testing and issue resolution). Establish dedicated IT personnel that end users can contact when they have a problem, and encourage timely, open communication on inefficiencies and errors.
- Measure adoption and optimize: Implementation is an iterative process that requires monitoring and change to iron out initial issues and encourage long-term adoption. Measure usage to ensure that team members continue to work in the tool after the initial rollout, and if you spot a drop-off, survey employees on what's not working. Partial adoption can lead to chaotic data storage, inefficient workflows, lessened productivity, and even compliance issues.
HCM implementation best practices
Ace your HCM implementations with the following best practices that support each step of the lifecycle.
- Document current and new HR workflows early: Map workflows before starting your implementation process and after you've modeled the new processes in the HCM. This way, you have a record of existing workflows to improve upon through the implementation, and you create guides of new processes to share with end users.
- Involve cross-functional stakeholders from the start: If the HCM software touches a department, a representative from it should be on the implementation product team to guide goal setting and configurations. End users from these business areas should also be at least included in the design, process, and training stages.
- Minimize customizations: Try to modify your current processes to ones that the HCM system can execute, instead of extensively customizing the platform to run old workflows. Adapting processes to the new tool enables optimized work and prevents the creation of excessive, useless features in the new system.
- Prioritize data accuracy and governance: Clean up before migration so that the HCM platform can pull from reliable sources for the workflows it executes. Also, practice tight governance, following security protocols throughout implementation, protecting and correctly transferring sensitive information.
How Scribe Capture supports HCM implementation
Scribe Capture is the ideal companion for business leaders undertaking an HCM implementation. Scribe Capture:
- Maps HR workflows as they are performed in existing systems, as well as how they run in the new HCM system
- Automatically transforms complex processes into step-by-step, user-friendly guides
- Gives leaders the training documentation they need to run successful, role-based training
- Houses training information in centralized guides instead of forcing teams to rely on institutional knowledge and word-of-mouth training
- Instantly updates process documentation as policies and systems change
How Scribe Capture helps drive HCM adoption
One of the biggest post-launch challenges is ensuring employees and managers consistently follow new HCM workflows.
Drive buy-in with Scribe Capture, which supports adequate training with automatically-generated, user-focused guides on new processes. Scribe Capture documentation can show team members exactly how tasks like payroll updates, benefits enrollment, and approvals should be completed, empowering employees to take on these new processes confidently instead of reverting to inefficient, obsolete ones.
Scribe Capture also supports onboarding and ongoing compliance as workflows evolve by enabling teams to quickly and seamlessly update documentation. Team members can consistently rely on Scribe Capture guides as the most up-to-date process references.
FAQs
How long does an HCM implementation usually take?
The length of an HCM implementation depends on the complexity of the planning, configuration, and rollout, which tend to be more intensive at larger organizations with lots of data. While smaller businesses may be able to implement in a few months, enterprises can take over a year.
What should we do if our HCM implementation starts falling behind?
Determine the root cause of the bottleneck and involve key stakeholders in a plan to rectify it. Then, adjust the implementation calendar as necessary.
How often should HCM processes be updated after implementation?
Successful implementations are iterative processes, relying on continual review and process improvements. That said, it's wise to also conduct formal checks at intervals, like quarterly or yearly.
How much does HCM implementation cost?
The cost of HCM implementation ranges widely, depending on the size of the organization and the complexity of the work. Smaller businesses may spend just a few thousand dollars, while larger ones can spend over $100,000. Often, these systems come at a base rate plus per-user fees, which significantly affect pricing.
Who needs an HCM system?
Any organization running complicated HR and payroll processes can benefit from an HCM system.
