Keeping Track of Employee Headcount
How many people does your organisation employ right now? How would you find the answer? If it involves more than one HR data source, a spreadsheet, paper-based files, one or two phone calls and possibly even a calculator over many hours, don’t worry. You’re not alone.
Especially since the Covid-19 pandemic has led to a rise of remote and hybrid working, keeping track of employee headcount can become a daunting task for Human Resources.
When an organisation is in a constant state of growth and change, it's not easy to keep track of your employee headcount without using a Human Resource Information System (HRIS) to store all the data about an organisation's employees.
It's a challenge to see where you are growing, what resources and human capital are required and where. Plus, putting together HR reports on retention and churn can be complicated and time-consuming.
So, what exactly is employee headcount, why is it important to monitor, and what tools and HRIS software can HR use to track and report on?
Read on to find out.
What is employee headcount and what are HR challenges when tracking it?
Employee headcount, sometimes called a workplace census, is a metric that counts how many people are employed by a company at one time.
Sounds simple, but unless your business only has a handful of team members, it's actually a complicated task for HR professionals to monitor employee headcount.
Accurate reports about the total employee headcount are complicated by a number of questions such as:
- Who qualifies as a worker? Full time employees? Part time employees? Temporary employees filling in for those on leave? Contractors? Unless the definition of a worker is standardised within an organisation, it can lead to all types of headaches in human resource management
- How often is employee headcount updated? If it's an occasional or annual task rather than a dynamic, automated system with auto-generated HR reporting, it means there are likely to be errors and inconsistencies
- Which departments can access and update the headcount?
- Do different departments provide different data? In large companies, it's possible that HR reports which are based on job roles might show wildly different numbers to the reports from finance departments which focus on cost centres. It's important that departments can work together to standardise their numbers and get an accurate overview of the workforce
- Where is this HR data about the workforce stored? Is it centralised in cloud-based self-service information systems where you can access it instantly on an HR dashboard, or does it require trawling through many separate spreadsheets and files?
What is an employee headcount report?
Tracking employee headcount is a useful metric for reporting growth and developments in the company.
An employee headcount report will bring together detailed information about the workforce. This is useful for monitoring aspects of human capital including finances, diversity, performance management, and time tracking.
It's useful for human resource management (HRM) because an employee headcount report gives HR an overview of the people within the company.
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Why is it important for HR keep track of employee headcount?
There are many reasons why tracking employee headcount is important for HRM. Here are some of the biggest reasons that tracking employee headcount is good for the productivity of the entire organisation.
Finance and human resource management
Tracking employee headcount is crucial for determining budgeting. The number of people employed will have impacts on things like pay rises, benefits, bonuses, and hiring decisions. It's impossible to track a company's finances if you don't know how many staff need to be paid.
Plus, tracking employee headcount is important for determining which employees are eligible for overtime, based on factors such as their salary, job description, and schedule.
Larger businesses might be required to carry out demographic reporting. This is made easier if Human Resources are already tracking headcount and employee information as part of their HRM strategy.
Moreover, benefits and leave obligations can become unwieldy in larger organisations, so it's important to keep track of headcount to make sure that the business is fully compliant.
Automated information system technology can help HR keep track of information about compliance.
HR analytics inform strategy and business decisions
For the business as a whole, but also for HR departments, being able to monitor employee headcount is important for strategy. As the company grows, it might need to employ more HR staff or reorganise its management structure to maximise productivity.
Plus, decision-making about hiring and redistributing employees is simplified if you have reliable insight on the individuals, skills and capabilities already available within the organisation.
HR reporting on retention
Turnover and retention is an important metric for HR professionals to track, and it's much easier to produce HR reports when you can trust your employee headcount data. This can help HR departments produce better reports on turnover and gain insights about the movement of employees to more effectively identify the factors impacting turnover.
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What HR software tools are useful for tracking and reporting employee headcount?
At XCD, we know that it's unnecessary for Human Resources to spend hours manually putting the data together to report on employee headcount. Using HRIS software to automate the process to track employee headcount is a no-brainer. Here's why.
If you’re relying on manual methods, i.e. spreadsheets and other documents, working out who left what role and when, who changed roles and who has started can be an imprecise and time consuming task - unless you are a small businesses with only a handful of staff.
If you’re a medium-sized business or large enterprise, it’s more common for the people data you need to be stored in multiple places and databases. This means HR’s view of company headcount is likely to be significantly different from that of, say, a finance report.
At larger organisations, it's a time-consuming task to keep that up to date, with information about time tracking, payroll, employee performance, funding, employee data, and more. Try doing this manually and it quickly becomes clear that HR reporting needs automation to crunch all the numbers.
In addition to this, insight is extremely important when it comes to success planning and if you’re still using manual HR methods for data collation then this is not only laborious but also prone to errors.
As HR professionals, the last thing you want is to be in front of the board of Directors with inaccurate and unreliable information, or to generate hours of additional work in the form of HR processes like manual tracking and exception reporting. Not good for productivity...
HRIS technology will enable you to overcome these issues. At the click of a button, HRIS software makes it quick and easy to show all kinds of different scenarios relating to employee headcount. Here are just a few of the ways that using a human resource information system can streamline your HR processes.
Use HRIS to see growth and trends over time
For example, you will be able to see where you are now in terms of headcount compared to that of three months ago, a year ago, five years ago and so on. As a single source of metrics useful for human resource management, HRIS software makes it easier for Human Resources to gain important insights about trends in employee headcount.
You name it, the human resource information system will be able to calculate it. You will be able to demonstrate which areas of the business are growing and which are getting smaller, graphically represented on the HRIS dashboard for quick, effective presentation.
You can easily see growth and reductions and collate any form of stats you need using HRIS - ratios of PA’s to Executives over a specific period of time, for example.
HRIS software automates and updates information
Automated and updated in real time, using HRIS technology means that HR reporting on human capital is a piece of cake, rather than a major headache.
This means that employee profiles will automatically be updated during onboarding when a new hire joins the company as well as offboarding when an employee leaves, meaning that there is never confusion about how many people are employed.
Plus, employee profiles can automatically be updated with new job titles if they receive a promotion, or information about their benefits and timesheets. This means that not only will your overall headcounts be accurate, but they can contain a high level of detail which is useful for data-driven analytics.
Human resource information systems save time for HRM
Still not convinced? Modern Human Resources information systems save literally thousands of hours of reporting and boosted productivity, as you can read in one of our case studies where a business implemented our HRIS technology.
Using all-in-one HRIS technology frees up many hours for HR staff to do more productive and strategic tasks.
Interested in learning how XCD's HRIS software can help revolutionise how your HR department tracks and reports on employee headcount? Want to know how HRIS software can save hours by providing automated reports on people analytics for your business? Read our other resources on the topic below: