In our previous two blogs (https://mentorsunlocked.com/mu-primer-series-1-basics-of-inventory-module-in-erp/ ; https://mentorsunlocked.com/mu-primer-series-1-basics-of-finance-and-accounts-module-in-erp/ ), we had talked about basics of Finance and Accounts module and Inventory. In this blog, we will talk about essentials of Human Resource Management (HR) module.
Traditionally companies have used specific applications for Human Resource Management (HR)/ Industrial Relations (IR) , such as time attendance systems or maintaining employee databases. In many cases, these are offline applications that are not integrated with any other functions or ERP. Most SMEs limit HR function to tradition IR functions and, training and development of workforce. HRM solutions of today, keeping in with changing role of HR, cover all aspects of Human Resource Management and Development activities, such as management of alumni, employee surveys etc. Corona has added services/ processes such as health screening and maintaining social distancing to HR department’s scope.
Integrating HR module with other modules such as Finance and Accounts provides better control and reduced errors in employee processes. It also enables automation of processes such as salary processing and improved delivery of employee services such as leave requests, queries on balances, accuracy of records etc. . This not only reduces costs but also improves hygiene at work place and reduces dis-satisfaction in employees. Companies also automate processes such as settlement of employee claims. Different companies have different scope of work for HR department, for example, some companies include accounting and tracking of assets issued to employee for use such as laptop etc. within HR function.
As in Finance and Accounts module and inventory module, it does need defining and setting up different masters in ERP. The organization structure such as number of companies, units, divisions, functional areas (such as Finance and Accounts, Sales, etc) have to be codified and set up. So do other essentials such as types of employees, designations, types of leaves, types of employment contracts for processes to be digitized and automated. Just in accounts or inventory, we will have to create roles and access rights for members in HR team. The struggle to define roles for new positions in HR becomes easier if a framework is developed by listing different functions/ activities within the department and mapping them with roles. Companies that already have documented job profiles, job descriptions, KRAs or KPIs would find it easier to utilize full potential of ERPs.
We would like to hear your experiences with HRM modules, either standalone or part of an ERP.
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