You’ve heard a lot about scalability.
Scalability is how a company maintains or improves profit margins while sales volume increases.
A business scales up well when it keeps or even increases its performance under increasing operational demands. In other words, scaling up equals growth.
Growth is good – when you have the systems in place to effectively and efficiently manage it.
From an HR perspective, growth is good for companies. Growth creates new opportunities for existing employees.
Scaling up a business also opens up new jobs. As we’ve written before, the capabilities of your payroll and human capital management (HCM) systems directly impact the growth and financial success of your business. These systems create a more engaged and connected workforce.
It seems counterintuitive, but bringing on new employees can bring a company down, even as it grows.
This phenomenon is called “Packard’s Law,” after Hewlett-Packard founder David Packard. The company’s growth (attributed to high-achieving employees), caused it to go on a hiring spree. But the merely average talent they quickly brought in caused the company’s performance to slowly erode. In this case, scaling up the company actually caused it to suffer.
You may be excited and ready to scale your business. But before you dive in, you must step back and evaluate your current state.
Any business, can grow and scale effectively – whether service, manufacturing or product sales – with the right human capital management strategy. Because people make the system.
So, how can HCM help scale your business? Here’s how:
- Systematize your onboarding process: Your HCM system should streamline the new hire onboarding process by sending automated notices, and require new hires to complete all of their information (electronically signed consent, I-9 and W-4 forms, etc.) online.
- Single source your HR administration: Choose an end-to-end, single-source solution that provides payroll, tax management, applicant tracking, onboarding, HR administration, employee and manager portals, leave management, analytics, training, ACA reporting, and more.
- Simplify the benefits process: Does your HCM platform allow employees to enroll in benefits via an intuitive benefits enrollment engine? Demand an easy-to-use application that eliminates double entry and paper enrollment forms.
- Allow access: A single sign-on dashboard for both managers and employees gives them all of their personnel and business information in one convenient place. This fosters improved employee engagement and empowerment.
- Design it to grow with the needs of your business: If your HCM platform doesn’t focus on the key activities that move your business forward in a strategic way, you’re doomed to stagnate. Or even move backwards. People are the backbone of your business, so invest in their growth and development, keep them motivated and working toward new goals.
The bottom line is that it’s almost impossible to scale up a business without great people. Finding and keeping them can be tough. Taking your $5 million business to a $50 million one, or $50 million to $500 million, requires planning and capital, and strategic thinking about your biggest asset – your human capital.
Payday HCM takes the mystery out of scaling your company’s human capital management, offering a custom solution to employers who lack the internal resources that are critical for hiring quality talent. Contact us at 888-2PAYDAY or email info@PaydayHCM.com.