What is HR Automation? A Guide with Practical Examples
Rapid advances in HR automation have enabled HR departments to streamline and speed up their ways of working, automate many tasks, and devote more time to people-centered tasks, including empowering their employees. How can your team apply HR automation and work in a more efficient and effective way?
There is no doubt that human resource management and processes are a critical part of every business. HR is responsible for recruiting, onboarding and offboarding employees, training and development, payroll and timekeeping, tracking vacation and sick days, and employees’ general well-being within the organization. Without HR, no company would be able to operate smoothly.
However, many HR departments are drowning in administration and paperwork required for manual processing across these tasks. There was a time when there was no alternative. Now, HR automation comes to the rescue.
It won’t be long before everything that can be automated within HR will be. That’s why it’s important to make the transition sooner rather than later to ensure your HR department remains skilled and doesn’t get left behind.
Contents
What is HR automation?
Benefits of HR automation
Examples of HR automation in action
The best HR automation tools currently on offer
What is HR automation?
Human Resources Automation (HR Automation) uses software to digitize and automate repetitive and time-consuming tasks, including employee onboarding administration, payroll, timekeeping, and benefits administration. This frees HR employees to focus on more strategic tasks that are more valuable to the company. It also improves efficiency and security while reducing the potential for human error.
HR automation has emerged because of the time and amount of physical paperwork involved in every-day HR processes. If HR professionals in your team spend more time on admin rather than utilizing their valuable skills in other areas of the business, then it’s time to find a new way of working.
However, switching from a manual approach to HR automation requires a certain level of skill and training in using the technology to be effective. But the benefits of HR automation for all your employees far outweigh the time, energy, and money you’ll invest in getting there.
Benefits of HR automation
Why should you invest in HR automation? To answer that question, let’s have a look at some of the key benefits of HR automation.
Improved efficiency
HR largely depends on document-driven processes. When done manually, this can be time-consuming, repetitive, and extremely inefficient. Paperwork can get “stuck” in a queue or on one person’s desk and errors are common. What’s more, requiring people to come into the office or fax over signed forms is redundant.
HR automation digitizes all of the above and more, increasing productivity and efficiency across the business. The organization can then focus more energy on ensuring all their HR personnel are people’s advocates. They can concentrate on culture building, people’s practices, being a workplace champion, and a communications expert. All four of these competencies are essential to the performance of any HR professional.
Actionable insights
HR automation enables you to track, collect and analyze data of all kinds. This allows you to spot patterns and create reports on your findings. You can then use these insights to improve processes, correct any failures, and do more of what’s working across the business.
Reduced errors
Manually completing payroll, timesheets, and checking vacation leave paves the way for human error. Plus, a machine can easily do these tasks more quickly and reduce any room for error.
Improved communication and collaboration
HR automation provides a clear overview of all processes and stages involved. This helps everyone understand each other’s responsibilities, which improves communication and teamwork.
Reduced paper-based processing costs
Paper-based processing requires printing documents and then filing and storing them somewhere as a record. HR automation reduces the costs associated with this. It minimizes your need for storage space, and ensures records can easily be located at the click of a button.
Positive experience for job candidates and employees
When HR staff are drowning in admin tasks, they often don’t have time or forget to check in with new job candidates. This creates a negative hiring experience, regardless of whether they are eventually hired or not. HR automation means HR will have more time to get back to candidates and improve their overall experience.
Moreover, employees benefit from self-service. For instance, they get their leave requests and expense reports approved faster and they can keep track of their employee benefits. This contributes to a positive employee experience.
11 HR automation examples
What can be automated in HR?
Here are some HR automation examples with case studies of how companies currently use HR automation and how it benefits them and their employees.
Recruiting
Recruiting processes include:
- Posting job ads,
- Tracking responses,
- CV screening,
- Pre-employment assessments,
- Sorting and prioritizing candidates based on set criteria,
- Automated email flows.
When you don’t automate the unproductive admin tasks from these processes, your HR staff will spend unnecessary time on them.
CASE STUDY: The Osceola County’s Sheriff’s Office, Florida.
The Osceola County’s Sheriff’s Office used to have a paper-based recruitment process. It meant a huge stack of paperwork, lost forms, and lack of communication between departments and applicants.
Faced with a nationwide shortage of police officers, they implemented HR automation in a pre-employment online assessment.
In the first year, this increased applications in 2012 from 446 to 1,305 the following year. Forms were correctly completed (no fields were allowed to be left blank as with paper versions) and photos could be uploaded. Ultimately, Sheriff’s Office found better quality candidates due to the increased volume of applications.
The HR automation process also enabled them to complete paperless background checks and send automated emails to candidates, updating them on their application status. Plus, they saved an initial $2,000 on office supplies for new hire files.
Employee onboarding
Employee onboarding requires collecting documents for verification, signing forms, giving tool access to new hires, raising device requests, and much more.
HR automation can provide an easy-to-follow checklist during the process of onboarding. This includes the ability to create automatic notification and approval workflows, collect e-signed forms and automatically generate official PDF documents, deliver devices to employees quickly without waiting for IT support, and much more.
CASE STUDY: KPMG, Belgium.
KPMG didn’t have a pre-boarding process for new hires, which meant a long waiting period between signing their contract and their first day at work.
The company used an integrated and secure onboarding software solution to solve this issue. The onboarding process now starts as soon as the new employee signs the contract. New hires are automatically sent all the practical information they need to know from the app before they begin their first day.
After two years of using the HR automation app, KPMG employees rated their hiring experience a 4.45 out of 5, and their first week a 4.12.
Offboarding
The offboarding process can often be overlooked, but it’s just as critical as onboarding. When done the right way, offboarding helps protect the company and leave a good impression on your former employees.
However, manual offboarding is time-consuming. There’s a potential risk of losing forms or having them completed incorrectly. In addition, there’s a risk of failing to protect the company from a compliance and security perspective.
HR automation software enables you to create an offboarding checklist and:
- complete and upload documents electronically,
- schedule exit interviews,
- update personal information,
- make arrangements for the employee’s final paycheck,
- create requests for company equipment to be returned,
- remove their access to applications on a date of your choice,
- remove them from the company directory on their last day (to ensure it remains up to date).
Access to apps and tools
When a new hire joins an organization, they will need to be granted access to the relevant applications they need, at the right permission levels, on their first day. This can often lead to wasted time on the first day trying to get an employee fully set up and able to access the central systems required to perform their role.
HR process automation can enable you to grant access automatically to new hires based on predefined criteria. Employees are also likely to need access to additional applications and tools over time. HR automation allows any employee to request access to an app and have it accepted or rejected by their manager.
Paid leave management
Manually calculating and approving vacation days can be problematic since it involves many tasks:
- Checking the employee’s leave balance
- Getting manager approval for leave requests
- Recording the leave for payroll circulation
Additionally, if this falls on one person’s shoulders, there is much room for human error. Emails get forgotten, and there’s a risk of disruption when this person is on vacation or sick leave themselves.
HR automation software offers an automated leave management process that automatically calculates all of the above.
Expense claims
Did you know that 38% of employees reported that submitting and handling expenses is boring, while more than one in six say they dread having to do it?
Unnecessary manual tasks like submitting expenses are having a negative impact on your employee’s satisfaction at work. This has been proven to decrease their productivity and performance. Higher employee satisfaction rates lead to higher productivity levels, which leads to greater company performance.
Traditionally, employees have to submit the receipt, fill out a form with all the details, then have that approved by a manager. Forms wait on people’s desks and start to pile up. They can be filled out wrong and get misplaced. Approximately one in five manual expense reports are filed incorrectly.
HR automation allows you to digitize the expense process. Employees can upload a receipt photo from their phone, while expense management software automatically extracts the required data (amount, merchant, VAT, etc.). Once an employee submits this, the relevant manager is notified immediately and can approve or reject it. A controller then checks the details are correct and processes them with one click. This saves employees up to 70% in processing time on average, eliminates human error, and gives companies a real-time spending overview.
Payroll
Manually calculating the time or days worked, along with sick leave or vacation days, leaves much room for error. This leads to employees being under- or overpaid.
HR automation can simplify the process by tracking and calculating everything automatically, simplifying payments, and make data much easier to find if needed for a compliance audit or something else.
CASE STUDY: FuelCell Energy, Connecticut.
HR director Sandi Mauro did what she always used to do with her small team. She compiled a set of Excel spreadsheets with workers’ compensation numbers from management, and sent them on to payroll to be processed. But after the payroll had been completed, the payroll manager sensed something was wrong. After looking into it, Mauro discovered that one of the spreadsheets had been sorted incorrectly, which meant that every employee in the company (600 people) was set to receive somebody else’s pay.
FuelCell Energy swiftly decided to invest in HR automation software to cut down on human error, save time, and give employees more insight into how their pay was being calculated.
Compensation planning used to take a whole month to complete. On the contrary, it takes a week and is error-free with the new system.
Tax filing
There are different tax laws at different levels (local, state, national, international). These depend on the organization’s size and where it operates. This means that filing taxes can be complex for your HR department, especially as laws are frequently updated and changed.
Automating payroll taxes based on relevant laws ensures that employees and contractors receive and complete the correct forms. It also provides a digital file that is easy to locate in the event of an audit. HR tax software makes the tax filing process faster and eliminates stress.
Time management
Having a manual timesheet for time tracking and appointing one person or a team to track it is extremely inefficient. They can often be filled out days later and also misplaced.
An automated timesheet app allows you to digitally store employees’ profiles, attendance records, and other information. This makes the entire process faster and more accurate.
Employee benefits
A benefits management service or a professional employer organization (PEO) often handle benefits including health care, retirement plans, workers compensation, and other benefits for many organizations.
The problem with this is employees usually have little to no insight into the types of benefits available to them during their employment.
Automation software can track all employee’s situations and display their benefits to them, including when they experience a change in circumstances. It is an example of employee self-service.
CASE STUDY: Grolsch.
The more employees an organization has, the harder it is to keep track of each individual and their changes and preferences.
This led to beer company Grolsch investing in an automated HR system called “My Benefits.”
The system displays every employee’s situation and benefits whenever they record any changes. The result is all their employees now have a much better insight into the benefits available to them.
A satisfaction survey showed increased contentment from a 6.8 (out of 10) with the old, paper-driven system to an 8.2 with My Benefits.
Employee performance tracking
Automating employee performance records means the company has accessible data to determine raises, bonuses, disciplinary action, or termination. HR can track these performance records and give managers access to add notes, prepare for performance reviews, and ensure objectives are met.
Automating performance tracking streamlines the process, ensures it’s bias-free, enables accurate decision making, and provides a great reference point for both managers and employees.
CASE STUDY: Metropolitan Utilities District (M.U.D.)
M.U.D. used to have a very old-fashioned approach to employee performance reviews. It consisting of a simple Word document with a few words changed each year and printed and handed out to employees. The document usually listed just five goals employees had been asked to accomplish over the year. If they succeeded, they received their bonus, but they would usually still get their bonus even if they didn’t.
The paper system had many issues. Only around 70% of employees got a review, while some reported not having one in 10 years. There was no real way to monitor progression, and the quality of work suffered as a result.
The company reached a point where they wanted to start tying pay to performance but realized they were ill-equipped.
Since implementing HR automation, every employee for the first year ever (in 102 years) had a performance review. Employees and managers can now communicate more easily about goals, and the entire process is easier for all levels of the organization.
M.U.D. saved an estimated two weeks’ worth of time by ditching paperwork for an automated system, along with many more benefits across the company.
What are the best HR automation tools?
What should you look for in an HR automation tool?
This largely depends on the problems you’re trying to solve. It must also integrate seamlessly with the solutions you already have in place and be fairly simple to use with minimal training.
You also need to consider the budget you’re working with, set yourself a rollout timeline, and consider your stakeholders.
Most companies can have up to 10-12 systems involved in the HR automation process, which means ease of integration is crucial for success.
It’s also important to note that HR automation will not fix poor HR procedures or policies. Additionally, your chosen HR automation software may work well for your company’s current size but fail to scale as you grow in size or expand overseas. These are all factors to consider before choosing an automation tool.
Here are some popular HR automation tools that you may want to consider.
Built for Teams
Built for Teams is a leave management software that utilizes shareable calendars to track attendance, time-off requests, sick leave, and other paid and unpaid leaves.
Bamboo HR
Bamboo HR is a platform built for data entry, data tracking, and the HR teams’ data information needs, payroll, management, and accounting functions. It allows users to store everything easily in one place, as well as create reports to gain valuable insights.
WorkBright
WorkBright offers fully remote onboarding for any organization. You can manage new hire paperwork and employee files from anywhere, and send automatic reminders throughout the onboarding process once an employee has accepted your offer.
Fuse Workforce Management
The Fuse Workforce Management platform brings together time and attendance management, HR management, and payroll into one software solution. It’s a powerful standalone tool that will give you an accurate view of your workforce, as well as improve decision-making, planning, and efficiency across the organization.
WebHR
WebHR acts as a bridge between HR and IT. Features include eTrack, Shift Scheduler, Expense claims, and Discussions. It also helps organize recruitment, attendance, leaves and holidays, and comes with a mobile app and support.
HR automation is the future: Don’t get left behind.
Effectively implementing and using HR automation will reduce the need for HR teams to complete mundane, repetitive tasks and create more efficient and accurate ways of working across the organization.
Your HR department can then devote more time and energy to creating a more positive people and work culture and utilize their skills on a day-to-day basis.
If you want to future-proof your HR skill set and develop new HR competencies, check out our All You Can Learn Certification Program!
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