The Simplicity of Human Capital Management Software

Updated: May 12, 2017

It goes without saying that a workforce within a company is mostly aimed at helping the company to earn money. At the same time, maintaining this workforce also costs a great deal of money, too.

Therefore, a question arises: how to manage the capital made from these workers while paying them the wage they earn?

The goal is to minimize expenditures as much as possible, after all. Here are some things to consider with capital management.

Connecting the Dots

The best way to keep expenditures to a minimum is to combine payroll, human resources, and benefits into one category to make the most of the business opportunities. This situation allows for capital to be streamlined into an umbrella solution.

At the same time, it sets up an ability to keep in compliance with Health Care Reform. Burdens placed on human resources departments can also be minimized to keep overhead costs lower.

Often, this task is done through automation or outsourcing situations.

The Simplicity of Human Capital Management Software 1

How is Human Capital Management Different from Human Resources Management?

Human capital management software treats its employees as assets. It is a more focused approach that keeps things more streamlined and people-centered, unlike human resources management.

There is also a greater emphasis on measurement, meaning taking what a person can do for the company into greater consideration. There is actually a set of metrics that can be used to make this measurement take place. It also helps to provide justification for personnel incentives.

Many people had a difficult time changing over to human resources management from the personnel mindset, to begin with, because they wanted to see people as, well, people and not a resource.

It seemed as if people were to be exploited for their abilities instead of being treated with a sense of humanity. A similar stigma has been created between human resources management and the changeover to human capital management.

Some people are concerned that employees are directly equated to money. Again, a sense of humanity seems to be lost in transit between the two.

Picking Human Capital Management over Human Resources Management

There are many people who believe that human capital management is the next best direction for human resources management to go. Defenders of human capital management believe that this theory behind this management system actually makes the business more “people-centric.”

In other words, people invest in themselves to make their skills and abilities an asset to the business. At the same time, an understanding exists that if the employer fails to treat employees as assets, then the employees are free to move on to another line of work.

In short, human capital management just takes human resources management one step further. It also enhances engagement between employees and the company, which makes obtaining goals and objectives a greater focal point for all parties involved.


It comes as no surprise that many companies are starting to change over from human resources management to human capital management.

In many ways, human capital management is based on human resources management, and it just takes that thought process one step further. Therefore, the changeover should not be too difficult for most businesses.