6 Reasons SMBs Decide to Bring HR Software Inhouse

When a small and medium-sized business (SMB) graduates from a PEO model, the PEO is often left wondering why.

The prospect of having a client move to a self-service Human Capital Management (HCM) option may seem like a losing proposition. After all, a PEO’s calling card is offering service. Doesn’t a self-service HCM option mean delivering less service? The answer is no.

Providing a service-oriented PEO option and a self-service option actually presents an enormous opportunity to grow your business. And knowing the reasons SMBs are bringing HR software in-house helps you better understand why.

“Some clients will grow to where they have more internal structures such as an HR or payroll department, so they don’t need all of the services a traditional PEO would offer,” says Jennifer Romano, PrismHR’s senior director of product management for HCM solution. “The co-employment relationship with a PEO also presents some challenges when it comes to self-service options. While traditional PEO software can offer some self-service capabilities, there are limits to what can be extended to a client due to potential risk, which may not align with the needs of the client. That’s one of the most popular reasons folks will graduate out.

1. Clients Want to Do More Themselves

It’s a changing world out there. Consumers are not only using self-service options, but they expect them. People are less patient about navigating customer service call-in queues and don’t want to wait around for answers to email messages.

Today, most software applications allow customers to set up, configure and troubleshoot on their own. Chatbots, FAQ portals, kiosks, and knowledge centers offer most of the information needed to self-diagnose an issue quickly without waiting for a live agent. And if the problem is too vexing, live support is always just a phone call away.

The result is a less frustrated and more satisfied customer. Through self-service HCM, clients can also handle new hires, benefits, administration and other services on their own. Empowering your clients to do more themselves is an excellent form of customer service and an important differentiator.

2. HCM Means More Efficiency

That brings us to a key reason SMBs are investing in HCM solutions. Using HCM software, companies can say goodbye to disconnected and manual HR processes. A centralized HCM solution simplifies and enhances the experience for employees and the HR team.

Tasks such as onboarding, benefit enrollment, performance reviews, and payroll are automated and streamlined. This enables companies to manage employees from hire to retire much more productively and efficiently.

3. Employees Expect Tech

Today’s generation of workers has been raised with information and answers readily available at their fingertips. Employees want to access personal data, check schedules, and get answers to common questions quickly and easily. Manual solutions don’t cut it anymore.

PrismHR’s HCM solution is designed to transform the user experience with easy-to-use, user-friendly tools. Self-service portals allow employees to manage personal information, view paystubs, and request time off. Engagement tools, including org charts and directories, keep employees connected wherever they are. Social media-like newsfeeds allow employees to celebrate success and share announcements, such as promotions and birthdays.

4. Leveraging Tech Reduces Labor Cost

Elevating and enhancing an employee’s experience boosts satisfaction, helping attract and retain top talent while reducing employee attrition. It also frees up capacity for the HR team to work on other tasks.

Ultimately, SMBs are looking to do more with what they have. Leveraging tech enables both employees and managers to manage many HR-related tasks more efficiently without the need for additional administrative staff.

5. Harnessing the Power of Data

SMBs may feel like they are drowning in a sea of data. But most understand that the real insights that data can provide will help them survive.

To achieve their goals, SMBs need to drive actual change. Data analytics drive actionable data-driven insights, such as:

• Improved hiring
• Better employee engagement, satisfaction, and retention
• Personalized employee development
• Performance Management planning
• Improved workforce planning
• Support for Diversity, Equity and Inclusion (DEI) initiatives
• Optimized budget and resource allocation

Powerful new HCM tools make it easier for SMBs to use data to their full potential. For example, Data Visualization identifies trends in a modern, easy-to-understand format. Tables, charts and datasets provide a clearer picture of benefits, payroll or other HR-related subjects.

6. Greater Control Over Compliance

HR and administrative tasks get more complex every year with new state and federal compliance regulations. This is complicated by the more than 13,000 tax jurisdictions in the U.S. HCM solutions provide SMBs greater control of HR policies and compliance, helping align company culture with legal requirements.

Providing a comprehensive suite of HCM solutions, from applicant tracking to performance management and benefits tracking, makes you more relevant to SMBs. Using an application programming interface (API), your clients will be able to connect PrismHR’s new HCM platform to their preferred payroll, benefits management and other tools for even more flexibility.

By allowing you to connect more HR processes, PrismHR’s new HCM solutions helps your clients become more competitive and successful as they grow and enables you to develop new business opportunities.

Learn more about PrismHR’s HCM platform.