What Is Human Capital Management? A 2024 Career Guide

Human capital management (HCM) is an evolution of the traditional human resources (HR) role. Human capital management takes the administrative functions of HR—recruiting, training, payroll, and more—and transforms them into business processes that empower workers, connect workflows, and streamline daily operations. The term human capital management refers to business enablement strategy and the technology HCM teams use to leverage data and enact their strategies. 

Benefits of human capital management

An HCM team or manager can benefit an organization in several ways, including: 

• Attracting and retaining employees

• Increasing employee productivity

• Improving employee engagement

• Enabling business growth 

• Optimizing the business workforce and spending

• Managing, analyzing, and streamlining employee data 

With more employees working remotely and increased demand for specialized skills and workforce data, HCM teams and managers can offer comprehensive support across an organization and bring out the best in everyone. 

Human capital management in Canada is experiencing a surge. One research firm estimated an 11.7 per cent compound annual growth of the country’s HCM market [1]. The rising focus on talent mobility, the surge in cloud migrations, and demand for automation have all prompted greater interest in HCM and HCM technology.  

HCM vs. HRM

While researching human capital management, you may have come across similar terms like human resource management. Some organizations may use these terms interchangeably, given there is some overlap between them. However, as you consider your career options, keep these important similarities and differences in mind: 

Why HCM is important

Technology is replacing certain job roles while simultaneously expanding our ability to get work done in remote environments. The labour market is tightening, yet there is expanded availability of contract-based and freelance employees with specialized skills. Additionally, there is an explosion in the amount of workforce data available, which is useful in many ways (especially in meeting the increasing compliance regulations in Canada and globally).

HCM jobs 

There are several common roles in HCM, as explored below:

Human capital manager

According to Glassdoor, human capital managers in Canada make an average of $106,402 [2]. 

Tasks and responsibilities you might have in this role include: 

• Providing employees with professional development opportunities 

• Offering services to employees such as counselling, coaching, and mentoring

• Creating job descriptions

• Devising plans to support and train underperforming employees 

• Recommending solutions to conflicts that arise among employees 

• Overseeing the company’s benefits program and ensuring employees receive the proper benefits 

• Providing employees with guidance on company policies and procedures 

Human capital consultant 

According to Glassdoor, human capital consultants in Canada make an average of $76,841 [3]. 

Tasks and responsibilities you might have in this role include:

• Advising organizations on how to improve their culture, leadership, compensation structures, and employee professional development 

• Analyzing current workforce needs and trends that will determine recruitment strategies

• Training managers and supervisors on effective leadership strategies

• Conducting exit interviews with departing employees

• Developing strategies to improve employee engagement   

Human capital analyst

According to Glassdoor, human capital analysts in Canada make an average base salary of $69,253 [4]. 

Tasks and responsibilities you might have in this role include:

• Analyzing current HCM strategies within an organization

• Evaluating current market trends and management strategies

• Helping organizations implement new HCM solutions 

As you gain experience in human capital management, you may also find opportunities to fill more advanced positions, such as director of human capital or vice president of human capital. 

How to start your HCM career 

If you’re ready to begin this career path, follow the steps below to streamline your process:  

1. Obtain an HR education and experience.

For most HCM positions, you’ll need at least a bachelor’s degree. Degrees in human capital management exist but are less common than degrees in human resources or human resource management. In your job search, you may find that some employers are open to hiring candidates with degrees in other disciplines, such as business or psychology. 

Consider taking courses or getting a certification in human capital management and gaining some entry-level experience in an HR role.

2. Become proficient with human capital management software.

HCM software is sometimes called a human resource information system (HRIS) or human resource management system (HRMS) and is a big part of how HCM teams operate. The software streamlines and simplifies many processes, including payroll, time tracking and attendance, performance management, record keeping, and more. 

Learning how these systems work can help you prepare for an HCM role. Examples of software that you can investigate include: 

• Ceridian Dayforce HCM

• Oracle Fusion Cloud HCM

• ADP Workforce Now

• Workday Payroll 

3. Build workplace skills for HR.

In addition to learning the technical skills of human capital management, you’ll also need solid workplace skills. As you take courses and gain experience, be sure to hone your ability to collaborate with others, lead teams, mentor new hires, solve problems, and develop rapport with coworkers.  

Having these skills can enable you to perform key HCM functions with success, including: 

• Hiring the right talent

• Monitoring performance

• Offering training and professional development opportunities 

• Delivering a superior employee experience 

Improve your management skills with Coursera. 

Taking online courses can be a great way to build skills related to human capital management and discover career opportunities. Explore the options below: