According to recent research, almost half (45%) of British SMEs don’t use HR software. That’s thousands of UK small businesses that are missing out on the time-saving, productivity-boosting benefits that a software alternative to spreadsheets can bring.

But, in today's world, when technology is advancing every day (especially in businesses), why are so many SMEs still shying away from HR software?

In this article, I’ll explain the problems that traditional spreadsheets, post-it notes and filing cabinets bring, and show you how switching to software can simplify things and – ultimately – boost business productivity.

The problem with manual HR processes

We recently conducted research to find out how much time small business CEOs are spending on pesky HR admin - and we were shocked to discover that it swallows up a fifth of their working week. That’s a significant amount of valuable time that could be spent on other important tasks to help the company and its people to grow.

Working directly with other SMEs, at Breathe we regularly speak to business owners and directors who admit to underestimating the amount of time it takes to stay on top of HR admin.

But, the truth is, as soon as you employ your first person, you’re dealing with the daily people-related tasks and responsibilities that is HR. And this can come as a shock - the amount of work is involved in establishing and running a small business is no joke. And that’s before dealing with essential HR tasks.

ACAS have produced a valuable guide specifically for new employers - it's certainly worth a read if you’ve just started hiring people.

How HR software can help

So, what’s the answer? Well, it’s certainly worth considering HR software.

Simple, easy-to-use systems like Breathe simplify the time-consuming people-admin for you, including holiday and absence management, expenses, recruitment, performance management and onboarding.

Intuitive reporting tools are also included to help you identify trends in employee behaviour that would otherwise be difficult to analyse.

If you use accounting systems like Xero, Quickbooks or Sage, you’ll already know how automating financial management can save hours every week. It’s exactly the same with HR systems like Breathe.

Whoever looks after HR in your business, the amount of time that’ll be saved is significant. For example, Breathe customers save a combined average of 24,000 per week.

And this is a natural driver for productivity. Essentially, the less time you spend on mundane, routine tasks, the more time you have to dedicate to strategy, development and growth.  

The McKinsey Global Institute has produced a brilliant white paper called A Future that Works: Automation, Employment and Productivity. In this they explain:

“Automation of activities can enable businesses to improve performance, by reducing errors and improving quality and speed, and in some cases achieving outcomes that go beyond human capabilities. Automation also contributes to productivity, as it has done historically.”

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How can HR software boost productivity?

Value for money

According to research, price is the biggest factor stopping businesses from switching to HR software.

But, in reality, some HR software packages are incredibly good value for money, and can pay for themselves many times over.

For example, Breathe starts at just £10 per month, all in. No hidden costs or extra charges.

And, with the time customers get back, it’s a minuscule outlay each month.

Work anywhere

One of the major benefits of cloud HR software is that it is accessible anywhere where with an internet connection.

And, in a time when remote and home working are increasingly the norm, this has never been so important.

All users are able to log in via their smartphones, tablets, laptops and PCs. This means people have access to the tools they need, as and when they need them – which naturally allows them to be more productive.

Cloud-based HR software such as Breathe offers users self-service. This means they can request holiday and report absences at the click of a button. It’s needless to say that completing these tasks manually using spreadsheets or – God forbid – paper records would take far longer, causing efficiency and productivity to take a nasty hit.

Save time on IT tasks

Then there’s the techy side.

Opting for software which is hosted and managed on your behalf in the cloud, and not on your own in-house servers can do wonders for productivity in your IT team.

Routine tasks such as data backups and software updates can be time consuming processes. But, if you go down the Software as a Service (SaaS) route, these processes become largely automated and are carried our by your service provider, so you won’t have to worry about it.

Whether you outsource an IT company or employ an in-house team, this will give them back valuable time to work on other important projects.  

But, not all clouds are equal. Look for those – like Breathe – which have been ISO 27001 certified for secure hosting.

Peace of mind

Security is another factor in why a lot of SMEs are software-sceptics. 

And we don’t blame SMEs for being wary – the data they hold is extremely sensitive.

Employee related information is about as sensitive as it gets, and General Data Protection Regulations (GDPR) apply as much to this area of a business as they do to marketing, customer services and sales.

If you lose employee information and are deemed by the Information Commissioner’s Office (ICO) to have been guilty of a data breach, you could be looking at a significant fine, which may even jeopardise the future of your business.

But, HR software can lend a valuable hand here. You may recall GDPR legislations changing in March 2019, with employees now legally able to request information held by their employees about them. This is called a Subject Access Request (SAR).

If the information is spread over different systems, spreadsheets and filing cabinets, collating this and suppling it to an employee could be a nightmare.

But, with all employee data and documentation centralised within a single system, should you need to respond to a SAR, you’ll have everything you need immediately.

Takeaways

At the end of the day, there is no getting away from the fact that running a small business is hard work and a major challenge, especially in a company’s early years. But, by equipping yourself with tools that automate manual HR tasks, you as an employee are on the path to boosting your productivity and – ultimately – driving your business forward.

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