IT and the changing role of HR (page 1 of 4)

HR has therefore become a huge investment for medium and large companies across industries, with people-related costs averaging over 60 percent of total corporate expenditures. The leading firms have been taking steps to ensure that they extract maximum value from their HR investments, introducing models that go beyond basic HR functionality to embrace new ways of improving the quality, efficiency and productivity of their workforces. These businesses recognize that, to be fully effective, HR programs require new processes, supported by leading technologies.

For these companies, the siloed HR department, focusing predominantly on basic administrative, record-keeping and transactional duties, is a thing of the past. Businesses now realize that a strong foundation of information about individuals is a highly valuable organizational resource that can be used to drive efficiencies throughout the business.

Of course, "People are our greatest asset" is a mantra that companies have been chanting for years. Yet it is only relatively recently that businesses have started putting HR systems in place that support this philosophy. As a result, the information that sits inside the HR department is being made available for effective use throughout the wider organization, helping companies align their workforces with long-term business objectives.

The backdrop to the introduction of these new systems is the uncertain business conditions that followed the economic downturn. This situation has resulted in a relentless drive for cost control, which affects the HR department as much as any other. HR now has to demonstrate that it can develop and deliver programs as efficiently as possible, providing greater value at a lower cost.

The current economic environment has also forced firms to become more nimble. The time to evaluate before taking action has decreased dramatically; organizations now have months or quarters instead of years to modify and execute business plans to take advantage of opportunities. As a result, increasing workforce flexibility and responsiveness is a key objective for HR departments in leading companies.

These competitive conditions have led stakeholders throughout enterprises to demand an end to the siloed nature of employee data and quicker, more frequent access to information that can help all levels of leadership make better business decisions. According to the Chartered Management Institute, 80 percent of a company's worth is tied to the value of its employees, yet there has traditionally been limited access to such workforce data outside the HR department. Managers have lacked visibility into even the most basic characteristics of their workforces, yet alone been able to answer more detailed questions about areas such as staff certification and training levels.

Yet with increased access to information on their employees, organizations can incorporate processes for leveraging worker skills across the enterprise, which in turn allows them to be more flexible. Firms with an in-depth view of employee competencies across regions or markets can immediately locate "best-fit" candidates, identify and resolve skill shortages, and re-allocate resources in response to changing conditions. In doing so, they often avoid expensive layoff/rehire cycles that sap morale, productivity, and profits.

Take Trintech, a provider of transaction management and payment infrastructure solutions to financial institutions, payment processors, enterprise retailers and network operators.