Human Capital Management Market

Human Capital Management Market Outlook (2023 to 2033)

According to Future Market Insights, the market for human capital management market is expected to reach a market of US$ 27.5 billion in 2023 with a CAGR of 13 % during the forecast period. According to estimates, the market will reach US$ 94 billion in 2033.

The modern concept of human capital management (HCM), or the art of building, sustaining, and managing a strong and productive workforce through the use of technology, data-driven insight, and creative solutions, is dependent on the use of technology. This particular approach entails the use of various strategies and tools in order to help employers obtain the maximum return on their investments in their people. The cloud and software-as-a-service (SaaS) delivery models are quickly becoming the new normal for HCM technologies. The cloud approach accelerates deployment, turns variable capital expenses into fixed and transparent operating expenses, lowers IT costs, and drives agility by speeding and simplifying upgrade paths.

Human resource management is one of the core features of human capital management, which is beneficial to every business entity. It facilitates the organization, operation, and payment of a global workforce in an efficient manner. Workday HRM enables organizations to create even more consistency at the local or global level. Additionally, it assists with securing various information needed to maintain worker's compensation records. Tracking and managing absence information is easier with the system's absence features, making it easier to access and manage employee absence information.

Human capital management (HCM) processes can be streamlined and automated using robotic process automation (RPA). Several processes can be automated with the use of robotic process automation, including those related to employee onboarding and offboarding, payroll, benefits, and compliance. Automating data entry across multiple systems and databases, the use of robotics process automation can also be used to ensure that data is accurate. In addition to automating the process of tracking time and attendance, along with the performance management process, RPA can also be used to automate other processes. Furthermore, RPA can be used for the automation of the generation of documents, such as contracts for employees, offer letters for new hires, and termination letters for employees.

HRM helps companies match employees' skills and expertise with appropriate roles. A unique role is being played by artificial intelligence and machine learning. AI is completely changing the recruiting game with the future of human capital management. Employee engagement and empowerment are key to modern HR practices, and Human Capital Management systems now provide a range of services beyond talent management for a wide range of industries and organizations.

The stand-alone software is purchased by some companies to handle multiple HRC imperatives, including recruiting, payroll, and performance management. Software integrations with robust API layers are enabling companies to automate tasks such as web analytics and employee portal management. Integrated HR functions powered by workflows can allow forward-looking companies to meet their goals, increasing employee engagement and empowering HR staff. The use of human capital management technology enhances business efficiency and reduces costs by automating manual and paper processes. Furthermore, organizations are undertaking a number of initiatives that are intended to foster diversity and inclusion in the workplace, and the use of HR technology is assisting in automating and streamlining administrative procedures.

Human capital management is likely to evolve into a more sophisticated system in the near future, which will allow for greater customization and more effective utilization of strengths. Technologies that may further impact the market include AI, ATS, NLP, cloud-based collaboration, and remote working technologies. Furthermore, employee data and records can be securely stored using blockchain technology.

Tracking employee performance and movements through wearable devices would be an excellent idea. Virtual reality and augmented reality applications can be used to improve employee training in the workplace. Human resource processes can be streamlined and automated by using robotic process automation (RPA). An automated Chabot that can handle recruitment, onboarding, and other aspects of HR issues will be the focus of many businesses in the coming years.

Human capital management is a process or set of practices that are associated to people resource management. The process comprises of recruiting, managing, developing and optimizing the human resources of an organization to drive engagement, productivity, and business value.

Various components of human capital management includes workforce planning and management, performance management, payroll and compensation management, recruitment and others. To deal with ever increasing list of HR processes, various IT players are developing advance human capital management software’s that helps to streamline HR operations.

The rapid advancements in human capital management software’s with the integration of AI and ML technologies would propel the market growth in the coming years.

Human Capital Management Market: - Market Dynamics

Integration of AI and ML Technologies in Human Capital Management Software is spurring the growth of Human Capital Management Market

Over the past few years, there are rapid changes in the global business environment like technological development, emerging-markets growth, changing demographics, regulations and cost are driving the need of advanced human capital management systems.

The integration of AI, ML and Natural Language Processing (NLP) technologies with human capital management systems helps to meet the above challenges. These technologies helps to automate routine HR tasks, deliver personalized experiences, and gain actionable insights from HR data.

Integrating AI models in administrative tasks helps to improve workforce productivity and help organizations to streamline HCM processes. Whereas, the NLP technology helps to improve talent acquisition processes along with identification of skilled and knowledge employees. Hence, various traditional human capital management software providers are leveraging the benefits of these technologies to stay ahead in the market.

Need to Streamline HR Related Operations

The human capital management systems helps to transform traditional administrative operations HR departments. These systems help HR’s by automating various operations including talent acquisition process, employee onboarding, retention, performance management, payroll management and other major HR operations.

These systems also helps to highlight the importance of soft skills and personality development for employees. Moreover, the cloud-based human capital management models offers various benefits like global and mobile access from anywhere, reduces on-premise IT infrastructure and expenses, built-in disaster recovery protection services and among others.

These key benefits of human capital management systems would propel the growth of market coming years.

Sudip Saha

Principal Consultant

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Human Capital Management Market: - Key Players

Key players in the human capital management market are focusing on product innovation and strategic partnerships with the technology vendors to collaborate for offering advanced human capital management software and services to streamline HR operations. The major players offering human capital management software includes -

• Oracle
• Workday, Inc.
• Ceridian
• ADP
• SAP
• Microsoft
• IBM and among others.

The report is a compilation of first-hand information, qualitative and quantitative assessment by industry analysts, inputs from industry experts and industry participants across the value chain of the global human capital management market.

The report provides an in-depth analysis of parent market trends, macroeconomic indicators and governing factors along with human capital management market attractiveness as per segments. The report on human capital management market also maps the qualitative impact of various factors on human capital management market segments and geographies.

Human Capital Management Market: - Segmentation

By Software, human capital management market is segmented into:

• HR operations and Payroll Management
• Applicant Tracking System
• Workforce Management
• HR Analytics
• Services
• Professional Services
• Consulting
• Training and Education
• Reporting and Dashboards
• Support and Maintenance
• Managed Services

By Deployment Mode, human capital management market is segmented into:

• Cloud-Based
• On-Premises

By Vertical, human capital management market is segmented into:

• Banking, Financial Services, and Insurance (BFSI)
• Government
• IT and Telecom
• Manufacturing
• Healthcare
• Retail
• Energy and Utilities
• Transportation and Logistics
• Others