How AI & Cloud Computing Are Strong Catalysts in Human Capital Management
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How AI & Cloud Computing Are Strong Catalysts in Human Capital Management

The term Human Capital Management (HCM) is a predefined set of best practices for human resource management. Here, the goal of implementing these practices is to achieve organizational competency through effective:

  • Workforce acquisition
  • Workforce management
  • Workforce optimization

Today, the dynamics of the WWW (work-worker-workplace) philosophy demand a look back at people processes and thorough analysis in terms of the role of Human Capital Management in the modern context.

Human Capital Management – Key Elements

Let’s help you be familiar with the 3 key elements of HCM definition before we go into further detail:

  1. The first element is that HCM is not just a set of certain rules to follow but it is a set of certain practices that must be followed not just to be practical but to be relevant as well.
  2. The second element here is that HCM is particular to organizational needs. Simply put, one set of certain practices that are a great fit for one organization may not be suitable for the other. Regardless of what all practices you have, you must step a little further to find the best fit for yours.
  3. The third element states that you need to acquire the right competencies to map the agenda of workforce acquisition, management, and optimization. Here, using the ‘Workforce’ word seems a bit old-school but the overall definition certainly catches the right essence of HCM.

Human Capital Management – Automation and Global Accessibility

The applications of smart technologies, viz. artificial intelligence (AI), machine learning (ML), and natural language processing (NLP), etc. can help you automate everyday HR tasks, ensure custom-tailored experiences, and retrieve highly-actionable insights from the data.

When these processes are globally accessible, they develop unprecedented power to transform the world of human resources.

Artificial Intelligence in Human Capital Management

The application of AI in HCM is broadly based on Big Data (opens in a new tab/window). Since the 1980s, organizations have been implementing local human resource information systems (HRIS) or human resource management system (HRMS). The data collected by these systems have laid the foundation of the modern, cloud-based human capital management (HCM) system for HR professionals.

HCM enables HR to easily manage the complete lifecycle of their employees, provides seamless overall user experience, packs new talent management features, and consolidated data points from throughout the organization in the form of a single solution at a centralized platform.

This smart HCM solution enables HR to simply analyze how employees interact with work, the workplace, and one another to predict the organization’s future from the perspective of human capital.

Cloud Computing in Human Capital Management

Cloud Computing has truly become the NEXT BIG THING, today. Therefore, it’s time we talk about how technology has done wonders for multiple renowned enterprises. But before that, let us help you understand what cloud computing is and how you, as an HR, can leverage its application.

The term Cloud Computing refers to a computing resource that is delivered in the form of service over a network connection. Its implementation requires no local deployment or any software or hardware components, rather it’s based on a pool of shared physical or/and virtual resources.

Talking about the characteristics of the system, first, we have the flexibility that comes from scalability. This also means that the system can both scale and adapt all sorts of workload changes. Besides, the system can closely meet the levels of all available resources with the demand.

How AI & Cloud Computing Affect Human Capital Management

While AI-based systems make the overall employee lifecycle easier and more influenceable, cloud computing makes these processes globally accessible. Nevertheless, there are many other ways in which AI and Cloud Computing affect human capital management, such as

Talent acquisition

With AI in place, most of the talent acquisition tasks become completely automated. AI-driven technology helps make hiring objective, more transparent, and completely data-driven – starting from candidates sourcing to employee onboarding.

Also Read: 10 Actionable Tips To Hire The Best Candidate Today

Service delivery

AI-enabled chatbots have completely changed the way consumers interact with businesses, today. These AI-based chatbots can provide 24×7 real-time support to your employees, simply eliminating the need for HR professionals to attend to queries/services that employees seek answers to.

Performance Management

When it comes to employee performance management, all you need is data. In fact, there is no better way to execute this task than putting AI to practice and make data-driven decisions. This application also enables you to highlight both strengths and weaknesses of your employees in an objective manner.

This proves that the move to technology in HR is inevitable. It not only empowers HR to become more strategic but also employees to become more productive at the end of the day.

Cost control

Businesses can save a lot by adopting modern technology in human capital management. These cloud systems have more ROI (return on investment) because of their efficiency, global accessibility, and user-friendliness.

Highly customizable

As cloud-based systems have a myriad of features that HR can use for different tasks, they are highly customizable to meet their exact set of needs. They can simply leave behind the limitations of the traditional HRMS and help do a lot more.

Reporting power

Cloud-based HCM systems are quite powerful in terms of reporting too. HR can create comprehensive reports for individual employees based on data analysis, which can be pretty useful for decision making and all other future references.

Seamless integration

Businesses have been managing employees’ data in various old-school manners, and cloud-based HCM solutions provide seamless integration with their existing systems to ensure smooth data analysis and report generation.


Considering the significant role of AI and Cloud Computing in human capital management, it can be said that employee-centric organizations can’t afford to overlook their impacts. If AI empowers businesses to analyze and influence employee engagement & performance, cloud computing makes these processes globally accessible to HR.

Thus, businesses should consider adopting AI and cloud-enabled human capital management solutions to streamline the processes and for seamless data access globally.

Image Courtesy: scnsoft(dot)com

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