5 Data Points Your Employee Management Software is Missing
Table of Contents
Employee management software’s lack of connectivity to headcount systems creates gaps in tracking critical information about a company’s relationship with its workforce. They are singularly owned by Human Resources & People teams, with change inputs triggered from 3rd party systems. The activity within employee management systems is managed by hiring teams in spreadsheets, manually entered into applicant tracking systems by recruiting. While some staff management tools have direct connections to FP&A tools, the data is exported in a standardized way and requires FP&A reconciliations to validate this information.
5 Key Pieces of Information Missing in Employee Management Systems
1 ) Approval Data for Employee Changes
Every internal transfer, promotion, or employee change is managed through a ticketing system, whether you’re using chat/email/shared doc or a repurposed project management tool (Asana, Monday, Jira); the history of these changes is lost as an aggregated data point.
Key questions you can’t answer without this data
Who is creating the most HR work?
Who is approving changes that are out of band, process, or timeline, and what is their reason for doing so?
How long does it take for an action to move from request to complete, and how does this impact the perception of the service of HR?
What percentage of approvals get declined?
What’s the total impact of every employee transaction request?
headcount365’s headcount approval system not only allows you to customize the approval chains required for employee changes, it delivers AI summarized context about how that change came to be.
2) Total Compensation Picture
Employee compensation lives in the employee management software, but exists in disconnected places for different stakeholders. Hiring managers plan for headcount in spreadsheets, disconnected from the HR system. Recruiting teams store compensation bands, and approvals for exceptions when they find the “perfect candidate” in the ATS. Change data about offers that are above compensation bands happen in a vacuum, often in the applicant tracking system or individual emails between stakeholders. Finance stores employment burden costs in the FP&A tool. HR Leaders are missing key data about compensation.
Key questions that can’t be answered without this data
Which hiring managers pay outside of the bands?
When do salary changes happen?
Who are the bad-acting hiring managers who use offers to increase salaries above bands?
Is the business taking on the risk of compensation variance from new hiring?
High-risk change tracking is our most popular insight, used by HR leaders to focus on the changes to employees or new hires that create the most HR debt.
3) Connected Backfill Story
Attrition is actioned in the employee management software, but is requested outside the system, applying the same approval problems as above. Backfill requests to replace Bexited employees are stored outside the HRIS and can be complicated to track– especially if a hiring manager applies the attrition budget to more than one position.
The following time data is missing:
Termination notice period
Backfill Request time
Backfill approval time
Backfill hiring time
There is no way to link the record of the employee who left to the job opening in the applicant tracking system to understand the variance in the replacement. While employee management systems own attrition actions, they’re missing key data.
Key questions that can’t be answered without this data
What is the variance created by backfilled attrition?
How does backfilled attrition impact our current compensation position?
How long does it take to backfill an employee?
How do we manage employee float- the concept that we want to be hiring above our target employee size to account for the time it takes to replace employees.
4) Fully-Burdened Headcount Cost
Staff management tools do not quantify the total cost of employment as this is stored in FP&A systems. There are varying costs of employment based on location, job level, employment type, and many other factors, but employee management systems only speak in terms of salary. Key financial data that comes from employee information (notably sales ramp time for new sellers) is not incorporated into HR decision-making.
Key questions that can’t be answered without this data
How should HRBPs incorporate the financial impact of internal mobility into their decision-making?
How do lateral changes impact financials?
What is the impact of internal transfers on revenue? (i.e., should you approve that transfer out of sales without a ramped backfill?
What is the broader impact of employee activity on overall company revenue?
5) Finance/Accounting Cost Structure
The most common issue I encountered with employee management software during my time as a consultant was mismatching system coding for cost centers, departments, and people leaders. Finance teams had one thing, HR another, and they seldom matched 100% to the accounting system of record. This makes it tremendously difficult to tell a unified story to execs, boards, and shareholders.
Why is it essential to have all the missing data?
Employee management systems need a connection from headcount365 to add critical data to the various stakeholders who manage these employee processes. This data helps HR leaders get a seat at the table, and is critical to telling a compelling story about the impact of employees on cost, revenue, and production.