In the past few years, after being involved in about a dozen HR technology projects, I can say one thing with certainty - I am yet to meet a 100% data-driven HR function.
I am going to start by making it clear that this post is not about admonishing HR professionals, but about making the HR function more valuable and wanted in the organization. It is also about proving HR Technology business cases are easier to justify. And when HR is more valued, they don't just have a seat at the table, they are invited to have the best seat at the table.
So how does it all begin? With these 3 simple steps:
Document All Processes
Begin with documenting all of your processes in an all-encompassing collection of data detailing technologies used, with volumes, speed, people involved (including suppliers and customers), inputs, and outputs. This is popularly referred to as SIPOC diagram.
This shouldn’t be a surprise but in case it is, this is where HR needs to begin. It doesn’t matter if you don’t have a business analyst or the right software and skills or a team of consultants giving you bench-marking data on how your peers do it.
While all of the above does make the process quicker and easier, a simple way to start is with some butcher paper, some sticky notes and pens, and of course HR folk.
Once business processes are mapped out, they can easily go into an MS Word flowchart or any free mapping software. The idea is simple, and once business and HR know how things are done, who does it, how long it takes, what goes in and out of each step, and how many times the whole process is repeated, it is easy to calculate the following:
- How long everything takes
- What HR processes cost the company
- What can be saved by using technology
Inventory of Technology
This has to be one of the easiest steps that HR functions can do right now that should not require the hiring of any consultants or resources. Creating a simple table, diagram, or map of the HR technologies that are currently in use, what they cost to the HR function and the organization, and hence who owns them.
There is no other way to say it, if you don’t have this information ready, don’t waste your time going to meetings with consultants or even internal stakeholders like information and communications technology (ICT) teams, finance teams, and end-users because for stakeholders to take on the quest for new technologies seriously, this is the bare minimum.
Calculate People Costs
Last but not the least, at least 75% of most businesses' costs are to do with people. So inputting that information into your process inventory along with the costs of the people executing each step should be easy.
This will tell the company exactly how much each HR process costs and what the maintenance cost is. This should not be a foreign concept to HR. The challenge is usually having the processes documented in the first place, which goes back to Step 1 above!
All the steps lead to clearly measuring people, process, and technology data which pave the way for making data-driven decisions.
Something that might help is expense reporting software to help you make sense of how every dollar is spent.
Knowing the true cost of running your organization starts with taking a full inventory. Without this, you're at risk of overlooking details that may seem harmless but can turn out to be detrimental to the success of your organization. Learn about how an HRMS Analyst can easily take on all of these tasks, in our article here.
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For tools to help you and your team, check this out: 10 Best Open Source HR Software For 2023