Is it possible to create value through modern HR tools?

Human resources, when well managed, ensure the organization's long-term success, and HR facilitates this success. An organization's Human Resources teams serve as a vital link between employees and the organization in order to build a healthy work culture and align the workforce with the organization's goals. Recently, however, the role of HR has become more critical due to the diversity of business trends and the complexity of HR functions. As a value-driven activity, HR calls for systematic approaches that a traditional HR system can't provide.

HR activities today encompass creating jobs, finding placements, delivering a better employee experience, retaining employees, meeting customer expectations, creating value for stakeholders, and building a sustainable business model. The traditional HR system has limitations in justifying the demand of modern-day work culture. Modern HR tools are equipped with the latest technologies such as AI and cloud computing.

Companies today can rely on a variety of HR tools, such as a good HRM (Human Resource Management) system, employee engagement software, performance appraisal software, performance management software, etc.

Enhance stakeholder value: Stakeholders can be active and passive. Customers, suppliers, employees, business partners, managers, government officials, investors, and regulators are all active stakeholders. People in HR have a responsibility to work in the interest of stakeholders, especially employees. Their HR policies must meet the expectations of stakeholders and create value for them. Through HR tools, HR professionals can enhance stakeholder value in various ways. For example, they can track audits that provide insights into overall business performance and ROI, or they can implement training programs to increase employees' efficiency. HR tools can be used by companies to ensure compliance with government regulations and that everything is conducted according to the rules. Modern HR tools also track expenses automatically, which assists HR professionals in managing stakeholders' (investors') funds effectively.

Data analytics: A data-driven HR department can have detailed insights into business processes, which can be very useful in making critical decisions. As a result, it aids in combatting HR issues such as high attrition rates and employee turnover. HR tools today go beyond basic reporting. It supports the next generation of data analytics – descriptive, predictive, and prescriptive. Data analytics provide actionable insights into the current situation, predict future outcomes, and offer suggestions for dealing with future events. It has completely changed the HR professional’s approach to managing their human resource. This data is crucial for the HR team to analyze the needs of the employees and the resources required to accomplish their work.

Avoid HR lawsuits: Organizations need to follow various laws for the fair practice of employees’ rights and workplace safety. Failure to comply with regulatory requirements can result in fines and legal proceedings. Furthermore, it can tarnish the organization's reputation and erode its brand value. By using HR tools, organizations can stay vigilant over various HR lawsuits. To protect them from rule violations, the software sends alerts regarding various HR compliances. It allows organizations to remain within the legal framework and avoid penalties.

Employee Retention: A company's most valuable asset is its skilled employees, which is why it invests in the best human resources tools. The reasons why employees leave an organization are various- lack of training and development opportunities, workplace culture, job performance below expectations, employee burnout, etc. HR professionals can use HRMS systems to address employees' pain points and improve employee retention rates. The HRMS system allows the HR team to monitor the entire lifecycle of employees, pinpointing areas where employee retention might be compromised, and schedule employees' training programs, leave management, etc. The HRMS system lets the HR team take feedback from the employees, schedule their training programs, track their performance, and award them. As a result, it is able to mitigate the issues faced by the employees on a regular basis.

Automation: By automating some of the organization's core HR activities, the organization can streamline administrative tasks and improve employee satisfaction. HR can use HRIS systems to send offer letters to candidates, onboard candidates, automate reminders, enrol candidates in training, schedule meetings, collect employee feedback, etc. It helps HR focus on tasks that add value to the organization and improve employee satisfaction. Modern HR tools utilize even more sophisticated features and intelligent technology like AI and NLP (Natural Language Processing). AI and NLP can be used to analyze employees' behaviours, giving HR in-depth knowledge about how employees respond to different situations. This information can be used to create employee-friendly policies and improve the employee experience. Overall, HR Management systems with automation capabilities can assist the HR department in creating a stress-free workplace and optimizing their output.

Cloud technology and remote work: Cloud technology has improved the remote working experience for employees. It allows employees to work from anywhere and communicate in real-time regardless of their location. The cloud has proved to be a valuable tool not just for employees, but also for HR departments. Organizations with an online HR tool are able to attract the best talents in the industry beyond geographical boundaries. It supports the centralization of HR workflows and involves team members for the necessary approvals.


HR leaders are being forced to build value-driven, sustainable organizations due to disruptive business trends. Human resources should optimize the efficiency of human capital and improve employee satisfaction. The traditional HRM system does not align well with a value-driven organization. It is only feasible to adopt modern HR tools that can respond better to HR challenges and automate HR processes. The best HR software can streamline HR processes and make your organization more productive.