The State of HR Automation and Small Businesses

August 8, 2017 Pete Jansons

Does your small business automate any HR functions? If so, how many? New research from CareerBuilder sheds light on how many small businesses utilize HR automation, and how a lack of automation affects business.

Nearly one third of small business owners (31 percent) spend 10 or more hours each week manually completing tasks that could be automated, while 1 in 5 (19 percent) estimate they spend 15 hours or more.

When asked how the lack of automation for certain HR functions affect the company, small business employers named the following results:

  • Lower productivity: 25 percent
  • Higher costs: 23 percent
  • More errors: 21 percent
  • Less engagement: 13 percent
  • Poor candidate experience: 12 percent
  • Poor employee experience: 11 percent
  • Poor hiring manager experience: 9 percent

When asked to name the biggest time wasters in their day, 1 in 5 small business employers (21 percent) cited “performing tasks manually that could be automated.”

Where does your company fall? Below is a breakdown of the HR functions that HR managers at small businesses say are currently fully automated, partially automated or not automated at all.

HR Function

Fully Automated

Partially Automated

Not Automated

Payroll

41 percent

37 percent

16 percent

Background checks/drug testing

26 percent

29 percent

33 percent

Applicant tracking

20 percent

30 percent

37 percent

Benefits administration

28 percent

35 percent

28 percent

Distributing job postings to different websites

20 percent

29 percent

37 percent

Compliance

22 percent

33 percent

34 percent

Performance management

20 percent

30 percent

40 percent

Sourcing job candidates

17 percent

33 percent

39 percent

Predictive assessments

17 percent

25 percent

36 percent

Training/learning

19 percent

37 percent

37 percent

Employee referrals

17 percent

29 percent

43 percent

Onboarding

18 percent

35 percent

37 percent

 

Small business may not have the same number of HR issues as larger companies, but managing employees and various HR functions can be just as complex. Consider just a few benefits to automating HR:

  1. It saves time and improves efficiency. Manually entering employee information using spreadsheets and Word documents is time-consuming in and of itself. Then consider the time spent trying to retrieve data or re-enter information. Using software that automates these functions can add more time to your HR team’s day. In turn, they’re able to focus on other areas, such as workforce planning or employee engagement.
  2. It increases morale. Free of the tedium involved with manual HR processes, your HR team will be more excited about their work and the ability to contribute more to the “human” part of human resources.
  3. It cuts down on human error. Not only does manual HR work eat up time, it also increases the chances of costly mistakes due to human error. Automated HR technology can help mitigate these risks.
  4. It improves the employee experience. When you invest in software with self-service capabilities, you empower employees to manage their own information - from reviewing benefits to requesting time off -- and empowerment is a huge morale booster.

Gone are the days when only big businesses needed – or could afford – HR automation software and technology. Today, not only do small business have a lot to gain from HR technology, it’s more affordable and can be scaled to fit your needs.

 

Learn more about human capital management software for small businesses.

 

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