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The good news is that hosted human resources providers offer small businesses the functionality previously available only to enterprises. The better news is that this can be cheaper than in-house platforms.
Can the Internet Be Your HR Department?
Typically, the single largest expense for a company of any size is the cost of payroll and managing personnel issues. As companies grow, headcounts increase and so does the process of maintaining payroll, benefits administration and other corporate policies, such as vacation schedules, sick time, hiring, etc.
The good news for small- and medium-sized businesses (SMBs) is that they no longer need a dedicated department to manage human resources (HR) activities. The Internet is playing a pivotal role in this change.
By leveraging Web-based HR technology platforms, SMBs can now offer “big business” services to employees while enjoying the time and cost efficiencies associated with a centralized system.
For SMBs, pen and paper and technology ranging from QuickBooks accounting applications to more comprehensive HR and payroll systems have long been the staples to manage these processes.
While these methods and systems have their merits, the Internet has enabled SMBs to realize greater efficiencies by utilizing hosted HR platforms. These systems eliminate the need to purchase and maintain applications and servers, are extremely easy to use, and are accessible via standard Web browsers and an Internet connection. They are also secure and very affordable with pricing models typically scoped on a per employee basis.
A critical concern for embracing any type of technology is security, especially with respect to safeguarding personnel information. When selecting a hosted HR solution, make sure it offers multiple layers of security and that the data is protected. Balancing security with accessibility and scalability, open database platforms offer the most flexibility. This will ensure your payroll and personnel data is easily accessible, and can be integrated with other applications as your company grows, all while ensuring the tightest security. You also want to make sure XML (Extensible Markup Language) is supported. This offers a data standard that can easily pass information from one application to another. So if you want your payroll processing application to connect with your benefits provider, this can all be integrated via XML.
Lastly, having browser-based access to your HR system allows you to open it up to not only the executive team, but also to each employee, enabling them to peer into their personnel file, view pertinent information and make requests (more on these benefits later).
Automating Processes
Through a hosted HR system, SMBs can directly connect their payroll and benefits administration within this centralized platform – hence, the elimination of manual processes, which reduces errors and improves overall data accuracy.
Most hosted HR system vendors offer a range of services that span the lifecycle of personnel management – from recruiting to payroll terminations and COBRA administration. A centralized system with XML-based interface capabilities can automate these processes, and seamlessly manage the day-to-day activities, reducing costs and minimizing risk and liability.
These systems can also reduce the number of vendors that are supporting your business, improving cost efficiencies.
From an employee’s perspective, the company HR department is a dreaded place to visit or call. Long depicted in Dilbert cartoons as inefficient, paper-intensive policy police, HR does not deserve this moniker.
Hosted HR systems offer a Web portal that puts self-service tools in the hands of employees, giving them access to their information – 24/7 for true anytime, anywhere access. If they need to verify their annual salary for a loan, they can easily access the system to print a pay stub. If they want to update their benefits plan and add a dependent, this can be done easily through the system.
With these portals, employees are empowered to manage their own personnel issues, freeing up time for your office manager or HR department to deal with more important activities.
Regardless of industry and size, SMBs can achieve unprecedented efficiencies and productivity with a Web-based HR system. Such systems will enable you to focus on your core business, and enable your employees to deliver better service to customers by putting the “human” back into HR.
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