Most people are still too busy worrying about the next round of layoffs to be thinking about what happens when they start hiring again in volume. But counter-intuitive as it might seem, now's not a bad time to start thinking about what you need to do to ramp up your recruitment set-up next year.

Recruitment's never simply been about expanding your employee base, of course. Even if your organization isn't growing, chances are you'll be replacing at least some of your existing employees as vacancies come up over the next year. In fact, even if you're still cutting headcount and have a total freeze on recruitment, by next summer the picture could be very different.

The problem with recruiting in a downturn, of course, is that the volume of job applicants soars - and so does the cost of managing recruitment campaigns, particularly if it's done manually. High-volume also means slower response: the more applicants you have to cope with, the longer it will take to filter and shortlist them, and the greater the likelihood that anyone who's any good will have been snapped up by someone else.

And it's not just about today's jobs. For all you know, high-quality candidates may have been scouring your website this year, thinking that your organization looks a good potential next step when they feel confident again about moving on from a steady job. Candidate Relationship Management is all about enabling you to keep in touch with high-value candidates in case the right opportunity comes up - all of which usually requires some kind of software.

Of course, getting approval to invest in improving your recruitment systems will probably be a struggle today - and it doesn't exactly look good if you're laying people off from one side of the business while spending money trying to attract a new batch through the other side. But economic cycles shift, and finding talented people will be just as critical next year as it was two years ago. It doesn't have to cost you an arm and a leg to do it either, as we'll show in a briefing paper to be published later this month.

One of the greatest ironies of a downturn, of course, is that organizations have the least money to spend just at the time when the highest number of good quality candidates are on the market, all victims of downsizing and corporate collapse. It's a buyer's market - but you still need to be in the market to get the benefit.

While much of the debate about managing absence focuses on practical interventions and strategic well-being initiatives, the problem for many companies is that far more mundane pieces of the equation are still getting overlooked.

Early in September, Webster Buchanan Research will be publishing a new Briefing Paper focusing on managing absence in the public and private sector. It examines the business impact of absence across a wide range of areas, not least cost. With the UK's Chartered Institute of Personnel and Development estimating that absence costs on average £692 ($1,126) per employee per year, this equates to at least a six-figure dollar sum annually for any organization with more than 100 employees. The Paper also looks at some of the approaches organizations are taking to tackle the problem, from basic steps such as enforcing back-to-work interviews to more enlightened initiatives around long-term sickness intervention and employee wellness programs - initiatives that have featured in this column before.

But while high-performing organizations grab the headlines, many others are further back down the curve when it comes to managing absence, and still struggling with some of the operational basics. As our Paper argues, the reality is that it's hard to put many absence initiatives into place without first ensuring you have a good operational framework - which means effective data management, procedures and policy.

Over the years, Webster Buchanan's research has consistently shown that HR's efforts are hindered by poor data management. Take our last survey, where almost four out of five HR managers agreed that the difficulty of getting relevant data together undermines their reporting and analytical capability. This is as true of absence as anywhere else, where conventional approaches to both gathering and then managing absence data tend to be inefficient at best, haphazard at worst.

At the same time, if absence procedures such as setting up return-to-work interviews still rely heavily on human interactions and manual processes, there's always going to be a danger that something will be overlooked. Automating these workflows could bring far greater consistency into your absence programs.

Technology is rarely - if ever - the sole solution to a business problem, of course - but in areas such as absence, a relatively modest investment can sometimes prove to be a pretty useful enabler. 

It’s an unfortunate reflection on the state of HR and Payroll reporting that while software vendors continue to make cheaper and easier-to-use tools, many organizations struggle with far more fundamental problems – such as getting their hands on decent data to analyze.

In Webster Buchanan’s most recent survey of HR managers in the UK, published in association with Computers in Personnel, respondents made no secret of how big a problem this is. Almost four out of five managers – 78% - agreed that the difficulty of getting relevant data together undermines their reporting and analytical capability.

Why? In many cases, it’s simply because data is scattered and duplicated across different IT systems and locations, from HR management systems to compensation planning tools, home-grown spreadsheets and paper documents locked away in filing cabinets. Getting this information into one central store – or providing central access to different information sources – is a precursor to getting useful reports. In fact, when organizations replace their manual HR or payroll processes with automated systems, the benefits that come from generating and aggregating electronic data can give just as much long-term value as the cost reduction and efficiency gains that typically drive these kinds of projects. 

Sadly, however, the problems don’t stop with data gathering. While there are plenty of reporting tools on the market – from the core software that comes bundled with your HR management system to specialist analytical software and services – a lot of people haven’t got their hands on them yet. In our survey, three out of five respondents said they don’t have the software tools they need to do anything beyond basic HR reporting. Worse, almost half of them (46%) agreed that even if they had the right software tools to carry out more sophisticated reporting and analysis, they don’t have sufficient analytical skills within the HR function to take advantage of them.

So in summary - the data’s not good enough, a lot of HR managers don’t yet have the right tools to go beyond basic reporting, and even if they did, half of the HR teams out there couldn’t use them today. If nothing else, that’s a good indicator of why you’ll increasingly see vendors offering analytical capability as a service that they carry out on your behalf, rather than simply giving you the tools to get on with it.

These kinds of problems aren’t confined to the HR function, of course. In payroll, some organizations still struggle to get a handle on the basic metrics of accuracy, timeliness and compliance - particularly multinationals, which often have only limited insight into the performance of some of their individual country operations. The extent of cost analysis that’s carried out can also be limited, and often doesn’t take into account indirect factors such as IT infrastructure and upgrades.

All of this matters – and not just to the HR and payroll functions themselves. Over the years, Webster Buchanan has consistently tracked how effectively HR is able to generate information that’s meaningful to the business rather than to HR itself – and we’ve consistently found that the quality of ‘inward-looking’ operational reporting is good, but more relevant business-centric information can be disappointing. This was borne out again in our recent survey. Most respondents were positive about the staple metrics of HR - 84% said they were good at reporting on the number of vacancies, for example - but only 44% claimed to be good at measuring the business impact of employee attrition, with 28% admitting to being poor. 

Not started offering payroll self-service yet? Watch out: you could soon find yourself in the minority.

Many organizations still tend to think of self-service as an HR-centric technology that’s largely about letting employees fill in their home address and bank details online, instead of sending a form for an HR administrator to fill in. But a survey just published by Webster Buchanan Research in association with Computers in Personnel demonstrates that adoption is spreading across multiple people management disciplines, from recruitment to performance management. Among them, there’s particular interest in payroll – no doubt in part because its transactional nature means it’s a good target for cost reduction initiatives.

As we explained in a separate survey on recruitment last year, Webster Buchanan divides self-service into two types: informational and transactional. Informational self-service is about giving employees, managers, and in some cases job candidates, access to information such as details of training courses or job vacancies. Transactional self-service enables managers and employees to interact online with HR and payroll – for example, by submitting individual performance reviews or applying for a training course.

With informational self-service, our survey shows that some 17% of respondents already provide online pay advice (an ‘electronic payslip’) today and 42% plan to do so within twelve months. So if they’re true to their word, by this time next year almost three in five payroll departments will be providing electronic payslips in some form. Even if current economic conditions slow down this planned adoption rate – which, frankly, is quite likely – it’s still only a matter of time. And of the 41% of respondents who said they don’t plan to roll out electronic payslips over the next year, the bulk (32% of the overall total) intend to do so long-term.

Similarly, over one in ten respondents already enable employees to view their pay history online, 38% plan to within twelve months, and another third (34%) are looking to do so long-term.

All of which puts some interesting context to a discussion I had just last week with a payroll manager who won’t make her employees’ pay histories available online for fear of confidentiality breaches. When I asked her whether she was comfortable using online banking with her own financial institution, I got an immediate ‘yes ’ – followed by a short pause while these two seemingly contradictory perspectives were reconciled. It’s completely reasonable to have reservations about confidentiality and privacy, of course, but ideally they should be a trigger to talk to IT about what security measures it can put in place, not an excuse for inaction.

Elsewhere, meanwhile, self-service adoption trends point upwards in a host of areas including recruitment, absence and training. For more information – and to find out what HR managers are doing elsewhere in everything from adopting Web 2.0 technologies to reporting and analytics – you can check out the report’s executive summary and download the full publication free of charge.

Is it really sacrilegious to suggest that sometimes – just sometimes – payroll should be content with delivering a poorer quality service? 

Coming just a few months after Webster Buchanan Research published our Payroll Performance Scorecard, a tool designed to help organizations better measure and manage payroll performance, this might seem a bit of an odd question to ask. But as we suggest in our latest research report, ‘Balancing cost and service quality in payroll’, payroll is caught between a rock and a hard place when it comes to service quality.

On the one hand, payroll’s goal is to deliver 100% accuracy, 100% timeliness, 100% compliance and high-quality employee service: on the other, like every other business function, it has to do so within ever tighter costs constraints. So unless you can dramatically change the equation through a significant shift in the way you work – such as automating ageing manual processes – something has to change, or something has to give.

As we point out in our report, payroll’s room for manoeuvre is pretty limited. You can’t compromise on your compliance obligations, and you’re not going to last long in your job if you mess with the timeliness of payroll delivery. So that leaves accuracy and quality of employee service as the two most obvious places to focus any cost-cutting efforts. The latter, thankfully, has big potential. As we point out in our report, payroll can borrow techniques from the consumer customer service environment to reduce the cost of interacting with employees, using everything from internet-based self-service to new Web 2.0 tools such as blogs and wikis. In fact, by doing so it might be possible both to cut costs and improve the quality of service.

Accuracy, though, is more tricky, and for some organizations may require a shift in thinking, particularly in terms of assumptions about delivering world-class versus industry standard performance. As the report asks, “is it acceptable for payroll to accommodate the possibility of a marginally higher level of errors – particularly errors with lower monetary value – in return for lower costs?”

The report stresses that “this is not about breaking business models that work: in organizations where payroll is processed with world-class levels of accuracy and at a cost that’s acceptable to the business, it would be illogical to compromise on quality. But if the costs are too high – for example, if there’s a lot of manual work involved within the payroll department – then there may be a trade-off in switching from world-class performance to industry standard in return for cost reductions, if only as an interim measure while the automation options are weighed up. Likewise, in an organization where accuracy levels are still unacceptably low, the cost of striving for world-class performance may be prohibitive, and industry standard may be a more realistic target."

Again, is that really sacrilegious – or just a sensible approach to coping with the realities of a cash-strapped economy?