Top strategies for building a successful HR tech stack – including the need for security

Relationships between companies and employees have undergone a sweeping transformation in recent years.

Saad Siddiqui, General Partner at Telstra Ventures, observes that from radical shifts in how and where employees work to the widespread deployment of AI, it’s difficult to think of a period in which workforce priorities and responsibilities have changed more rapidly or dramatically.

Meanwhile, the competition for talent remains extremely tight, putting pressure on HR teams to innovate in ways that will help their companies to attract and retain employees.

Building the right tech stack is a competitive necessity for HR professionals. This means adopting a centralised and streamlined digital platform for workforce management, making security integral to the hiring process with comprehensive background checks, offering more accessible and flexible benefits, using AI to improve productivity and data oversight, and providing high-quality onboarding and professional development opportunities.

These are all critical priorities for HR teams, and there are powerful digital solutions to address each one.

When HR teams fully leverage emerging technologies like AI and data analytics, they will be in a much stronger position to build and manage their workforces. This will give their companies a significant competitive advantage in a tight labor market, improve employee engagement and morale (which will reduce turnover), and increase performance. Let’s take a closer look at how technology is fundamentally changing the role of HR professionals.

Disjointed processes are among the biggest causes of headaches for HR teams, especially as workforces become more distributed. One way to alleviate this problem is to adopt a single centralised platform which allows HR professionals to manage workforces of all sizes efficiently and in many different places at once.

HR teams need the ability to onboard employees from around the world, automate compliance and manage core functions such as payroll and benefits in a single place. Over the next several years, we will see the emergence of third-party platforms that meet these needs in a streamlined and cost-effective way.

HR teams can work with external developers that create and manage these platforms so they won’t have to write their own code or invest in costly IT teams. This will provide an essential competitive advantage at a time when exceptional employee and candidate experiences are becoming more reliant on digital resources.

One of the most urgent challenges HR teams face is ensuring that the hiring process is secure and capable of fully vetting candidates. Over 55 percent of Americans admit that they have lied on a resume, while the cost of a bad hire is immense – beyond the immediate financial impact of wasting resources on training and onboarding, there are negative cultural consequences, productivity disruptions, and other harmful effects.

This is why more and more HR professionals are using objective and secure hiring methods like skills assessments. Beyond the protection these methods offer against fraud, they also reduce bias in the hiring process and enable more predictive decisions.

Conventional hiring methods such as unstructured interviews have a poor record of predicting performance, and they’re prone to bias as they rely on the subjective impressions of interviewers.

Assessments allow all candidates to compete on a level playing field and give recruiters a clear view of their skills and relevant behavioural traits. The demand for tech platforms that increase security and transparency in the hiring process will keep rising as HR teams rethink traditional methods of evaluating candidates.

There’s no one-size-fits-all approach to employee benefits, a fact that has become increasingly clear over the past few years. All employees have their own professional goals, financial constraints, and personal circumstances, which is why 63 percent say more flexible benefits would make them feel empowered in the workplace.

Meanwhile, traditional benefits such as PTO are generally underused. Just 27 percent of American workers say they used all their vacation time in 2021.

There are many alternatives to the static benefits packages many companies provide, from flexible HSAs and other spending accounts to financial wellness education – something nearly three-quarters of employees say they want.

HR teams should have open discussions with employees about their unique needs and concerns, which will help them adjust their benefits plans accordingly. But they also need to update their tech stacks to design and administer these benefits more effectively.

HR teams are inundated with point solutions for siloed benefits, which leads them to be reactive rather than proactive. This causes challenges with integrations across the technology stack, multiple (and cumbersome) employee touchpoints, and a monolithic infrastructure that limits speed and agility.

Companies can work with third-party HR tech advisory firms and benefits providers make this infrastructure more centralized and efficient.

The AI revolution is here.  According to Gartner, 70 percent of organisations are exploring generative AI while 45 percent say the headline-dominating publicity of ChatGPT has led them to increase their investments in the technology.

Employees are already using generative AI to perform their jobs more quickly and effectively, which increases the pressure on HR teams to keep pace through their own deployments of the technology.

HR professionals are using AI for a broad range of purposes: generating job ad templates, communicating with candidates, sourcing potential hires, identifying the right competencies among job-seekers, and so on.

However, HR teams’ focus on AI goes well beyond hiring and retention. The technology will alter the nature of work permanently, leading to widespread job displacement and creation. A recent Accenture reportpredicted that 40 percent of all working hours will be affected by large language models like ChatGPT.

A central responsibility for HR teams in coming years will be to prepare their workforces for the AI revolution, and one of the best ways to do so is through professional development and training opportunities.

It’s encouraging that 77 percent of employees say they’re “ready to learn new skills or completely retrain”.  They recognise the need to keep pace with dramatic technological changes to remain productive.

At a time when there are roughly two open jobs for every candidate actively seeking work, employee retention is vital. Employees are almost twice as likely to stay with companies that excel at internal mobility than those that struggle with it, which means training and professional development are crucial, especially when their tech skills are in great demand.

While HR teams will continue to face huge challenges like a competitive labour market and shifting employee expectations, rapidly emerging technologies will help them increase productivity, build healthier workforces, and gain an edge over their competitors.

By observing the principles outlined above, HR teams will leverage their tech stacks fully and prepare for whatever lies ahead.