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HR Automation For Indian MSMEs

The MSME sector in India generates nearly 30 per cent of the GDP as well as contributes about 45 per cent toward the country's exports

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Though India’s recovery from the Covid-19 pandemic is progressing well with plenty of large organisations contributing to the growth, it is the micro, small and medium enterprises (MSME) sector that forms the backbone of boosting the economy. 

The MSME sector in India generates nearly 30 per cent of the GDP as well as contributes about 45 per cent toward the country's exports. 

Nearly 6.3 crore MSMEs in India employ about 11.1 crore people. With such a huge chunk of the workforce engaged in the sector, it undoubtedly faces numerous challenges with regard to human resource management.  

While there are different challenges that restrict the sector from adopting digital Human Resources (HR) solutions like lack of awareness, cost constraints, etc. MSMEs cannot afford to neglect the wide array of benefits that come with HR tech. In fact, it become all the more essential to adopt the latest HR tech-based offerings to optimise processes, enhance productivity and improve the work-life balance of the employees.   

HR tech To make a difference

To stay on top of the business trends and drive exponential growth, many organisations around the world are investing in HR technologies. Here’s a look at some of the ways HR automation can truly help MSMEs: 

Smart recruitment 

It is a well-known fact that recruiting new hires is a costly and time-consuming process. HRs have to put in hours behind searching for the right candidate for the job. However, thanks to technology, finding the right skill for the job has become easier and more efficient. AI-based tools are improving the hiring process by scanning a candidate application for the required criteria and even alerting candidates on whether the position is suitable for them. 

Chatbots are able to take care of routine HR tasks like arranging interviews or answering questions of applicants which can save a lot of time for HR and allow them to focus on business issues that require more attention. One of the best parts about using intelligent technology in the hiring process is that it eliminates the human bias from the hiring process.  

Seamless communication and enhanced employee engagement 

In a dynamic working environment, it is always necessary to promote transparency in communication. Optimising performance becomes easy when MSMEs can succeed in this area. Communication platforms and applications can foster clear, seamless communication between different departments and employees within the organisation which lead to better engagement. 

Also, interconnected programs and platforms allow managers to provide real-time feedback on the performance of the employees which keeps them assured that their work is valued in the organisation. One of the key aspects of the present-day human resource management system (HRMS) software is the learning management system (LMS). It helps businesses to impart the right training and knowledge to the employees and creates a sense of belonging and value within the employees. 

Improved payroll management 

Unlike large organisations which have their own payroll specialists, businesses running on a smaller scale might have their owners running the payroll themselves. 

Maintaining compliance and payroll as well as calculation errors requires a lot of contributing factors that may be hard for an owner to maintain. However, with the help of a cloud-based HRMS solution, updating processing methods and factors in a timely manner becomes easy. 

Owners can find, manage and analyse data within a fraction as compared to the time it takes when that data is stored in a traditional spreadsheet. HR technology allows businesses to reduce errors, save time and help position the company as the employer of choice with a robust compensation procedure and approach. 

Impact on the overall decision-making process 

People who run businesses require access to information and data to make informed decisions. When HR technology is mapped with big data and analytics, it can help improve almost every aspect of the business through efficient data collection and analysis. By using this data, HR leaders or business owners can make informed decisions and help the company meets its goals efficaciously.  

Although HR tech holds great promise for businesses, it is important to understand that humans and technology must work side-by-side to drive business growth. Employees desire the “human touch” and technology alone cannot be a big enabler. 

There needs to be a proper collaboration between humans and machines so that business challenges can be mitigated and more accurate results can be achieved.

Disclaimer: The views expressed in the article above are those of the authors' and do not necessarily represent or reflect the views of this publishing house. Unless otherwise noted, the author is writing in his/her personal capacity. They are not intended and should not be thought to represent official ideas, attitudes, or policies of any agency or institution.

Vicky Jain

Founder, uKnowva, Mobile Enabled HR Software for your Business.

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