What is Human Capital Management Consulting?

Your business invests a lot of money in an effort to make more money, but what do you think your greatest investment is? It’s not marketing or product development; it’s your workforce.

Labor is the biggest cost of doing business, which can make up as much as 70% of your total business expenses. However, you shouldn’t think of it as a cost. Think of it as an investment. And if you want to get the most return on your labor investment, you need to know how to organize your workforce efficiently. That’s where human capital management consulting comes in.

What is human capital consulting?

Human capital is your business’s most important resource. It’s the knowledge, skills, and experience possessed by the humans in your company. In other words, it’s your workforce. Human capital management is all about how you use those valuable resources to optimize productivity.

The task of effectively optimizing productivity can be challenging. If you’re struggling to create an efficient labor force, it might be a good idea to call in a human capital management consultant.

A human capital management consultant is someone who works with a business to create more economic value by reorganizing and developing workforce strategies to optimize efficiency. Their goal is to attract the right people with the right skills and experience to get the most return on the business’s payroll investment.

Why is human capital consulting important to business?

The average business spends most of its operating costs on labor. Wouldn’t it be nice to make sure you got the best return on that investment? Working with a human capital management consultant helps you organize your workforce (your most expensive asset) and make it more efficient. It’s like hiring a professional broker to manage your stocks — except with better dividends!

With an optimized workforce, your business can operate more efficiently. You’ll have the right people with the right skills in the right positions to ensure your operations run smoothly. Your labor costs might not change, but your business will run more efficiently. And that’s just the tip of the iceberg.

Beyond efficiency, a human capital management consultant can also help you streamline your hiring and onboarding — which is a serious issue in today’s business world. According to research from LinkedIn, 76% of hiring managers say that finding the right candidates is their biggest challenge.

With human capital management consulting, you can utilize professional knowledge to perfect your hiring and onboarding processes and ensure you get only the talent that’s best suited for particular jobs. Not only will that ensure an efficient workforce, but when employees are well-suited for their positions and happy, you can also reduce turnover rates.

Armed with a talented and properly placed team, along with streamlined hiring and onboarding procedures, your business can enhance its scalability. You’ll be properly staffed — both in numbers and skills — to take on whatever challenge or directional change you decide is right for your business, without worrying about as many growing pains. All of this is possible when you work with a human capital management consultant to organize your labor force.

Human capital management consulting roles and responsibilities

Organizing and optimizing an entire workforce is a big job. These are just a few of the primary human capital management roles and responsibilities:

Recruitment – Finding the right candidates is just as difficult as organizing them (and perhaps even harder). HCM consultants help you identify the best places to source talent to keep your workforce strong and efficient.

Onboarding and training – Working with a HCM consultant to optimize your onboarding processes will help you train more effective workers and boost retention rates. Employees who go through a structured orientation program are 69% more likely to stick around for at least three years.

Time and attendance – Your business can’t be efficient if employees don’t arrive on time. A human capital management consultant can help you identify strategies to ensure your employees show up on time, every time, to maximize productivity.

Reporting and analytics – Perhaps the most important part of an HCM consultant’s job, they use data-driven analytics to determine the best ways to organize labor to create real, measurable, company-wide improvements.

Talent management – It’s not enough to just hire new employees. A human capital management consultant will find the right employees for the right position. When everyone is working toward their strengths, your business can run more efficiently with fewer hold ups or problems.

Compliance – Human capital management consultants are experts with HR compliance requirements, and they can help your organization maintain compliance from top to bottom, saving you money and headaches down the road.

When all aspects of your HR strategy work together, your business will run like a well-oiled machine, helping you get a better return on your labor investment dollars. That’s the magic human capital management consulting can bring to your organization.

Tips to improve human capital management

It always helps to work with a professional, but there are ways for business managers to improve their human capital management strategies to create more efficiency and productivity, while reducing errors and turnover rates.
Here are a few tips for business owners and HR managers can implement to improve their HCM processes:

Understand your workforce

The key to any great labor management strategy is to understand your workforce. Take the time to get to know your employees beyond just their job title. Ask yourself a few questions about each employee:

What are they good at?
What are they bad at?
What are their goals?

Once you know the answers, think about where you can place the employee to best fit their talents. For example, you might have just hired a new accountant, but they like to talk and distract everyone in the office. If you know they’re good at talking, perhaps they’d be better suited for a job in sales.

The better you can fit your employees’ skills and experience to their position, the more efficient your business will run, and the happier your employees will be — which means lower turnover and less hiring for you!

Clear and constant communication

Employees need communication. Whether they’ve just applied to a new position, are going through the onboarding process, or have worked at your business for years, it’s important to remain transparent with your workforce.

Business is always changing, and people don’t always like change. Those two facts might seem at odds with one another, but if people are prepared for the change, there are fewer speed bumps when the time comes to implement.

By maintaining constant lines of communication, employees and applicants can be better prepared for any changes coming down the road. When employees feel like they’re in the loop (even if the changes may not be considered “relevant” to the employee’s job position), they feel more engaged with the business and may even offer ideas for improvement that management might not have thought of, helping push the business to even more productivity and growth.

Open pipelines to new talent

Hiring is never fun, but it’s especially not fun when you’re crunched to fill a position. When change happens — whether someone quits or you want to expand to new areas — it’s important to have a steady pipeline to new talent.

Understand the platforms available to you and which ones provide the highest quality talent for your needs. Don’t post a job on Indeed when LinkedIn would get you better and more qualified candidates, for example.

It’s also important to keep regular tabs on your various job postings. Job seekers don’t have time to wait around for you to respond, so make sure you monitor your listings and respond to applications right away.

Use the right tools to optimize HCM efficiency

You wouldn’t use a hammer to put in a screw, so don’t use outdated HR processes to manage your human capital. If you really want to optimize your human capital management, it’s important to invest in the right technology.

For example, a hiring software that helps you post and monitor job listings across various platforms can help you track all your open positions and quickly respond to applicants, ensuring a steady pipeline of qualified applicants.

Invest in your most valuable resource: human capital

Businesses always want to stretch their dollar farther, which is especially true right now! By organizing and optimizing your workforce with human capital management consulting, you can make your business more efficient, reduce turnover rates, simplify hiring processes, and get a better return on your labor investment to push your business to the next level.

Human resource management isn’t an easy task. Don’t forget to check out the Workstream blog for more hiring and HR-related tips, tricks, and advice to help your organization grow.