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HR automation: how to build the right tech stack for your business

More and more small businesses are using HR automation to carve precious time out of their day to focus on what really matters — making work better for their teams. In this article, we look at how to progressively automate your HR processes and admin tasks, whether you’re a 10, 60 or 100-people company.

Today, progressive companies can’t afford to simply react to employee problems anymore. They know they need to strategically empower people to do their best work, feel accomplished and grow — so that the business can grow with them.

This new mission requires a lot of extra work on top of the old responsibilities.

For this reason, a lot of forward-thinking startups and small businesses are now automating some of their HR processes to focus their attention on building a great company culture — one that will set their team up for success.

In this post, we walk you through how to best automate your HR workflows. We point out what specific tasks to automate first depending on your company size, so you can gradually build the right tech stack for your team and your budget.

What is HR automation?

HR automation uses HR software to automate repetitive tasks and basic HR processes such as:

  • Calculating and managing time off
  • Collecting documents and information during onboarding
  • Facilitating performance management
  • Handling recruitment
  • Automating payroll

Different companies will have different priorities, and will therefore choose to only automate some of these processes by choosing specific automation solutions (like HR automation software, chatbots and mobile apps).

With HR automation, small businesses can save on time and costs they’d usually spend on manual HR tasks, making their processes more efficient and error-free.

The benefits of HR automation

For many progressive small businesses, HR automation tools have become more a necessity than a ‘nice-to-have’. Let’s have a look at why:

1- HR is more efficient and less time-consuming

HR admin can be a real time-sink — something that keeps you away from the work you should be doing:

“You can get so bogged down in admin and end up spending hours clicking through files. That wasted time is time you could be spending on decision making and more exciting projects.” Caitlin Price - Office Manager at Bloom & Wild

With HR automation, basic HR tasks and data entry happen by themselves — you’ll be more productive and will save precious time to work on more impactful work (such as building a career progression framework or writing your employee handbook).

2 - Human error is reduced to a minimum

If your startup has no proper HR team, you’ll likely be juggling multiple responsibilities at the same time. No matter how careful, mistakes can happen.

HR software automates and streamlines some of the most error-prone tasks you currently perform manually — so oversights and forgetfulness go down to near zero.

3 - It saves you money

Less work to be done manually means less people you need to get it done. Some HR tasks can be done faster and more efficiently by a HR system, which costs a fraction of what a full-time HR person would cost.

4 - It’s safe like no shared folder can be

When it comes to storing personal information and sensitive employee data, traditional cloud systems can’t compete with HR automation software. These platforms are designed to manage access permissions so that the right people (and only them) get to see what they are supposed to.

5 - Self-service HR management: let team members complete their own admin, anytime and from anywhere

Managers and direct reports can request and approve time off, run performance reviews and more, all in the same place. This makes it easier to delegate tasks to the right people and keep them in the loop, whether they’re at home or in the office. It makes for a better employee experience.

What HR processes shall I automate?

While automation is definitely the way forward, that doesn’t mean you should automate all of your HR processes, all at once.

Depending on how big your team is, you may want to prioritise some aspects of HR automation over others.

Start from the basics and build up from there — so you can avoid having to set up some cumbersome HR automation software that slows you down instead of helping you step up.

HR automation for startups (company size 1 to 10)

When your team is just a handful of people, you want to keep your HR processes flexible and agile, to allow space for your team to grow and your culture to evolve.

Startups this size have two main areas they tend to automate: time off and onboarding.

1) Time off

As soon as you get your first few employees on board, you’ll need to calculate their holiday allowances, keep track of the days they’re away, and set up a process for requesting and approving time off.

If you do this manually though timesheets, you’ll soon get to a point when it becomes unmanageable:

“We used emails and Excel spreadsheets to keep track of who was on holiday or off sick. But as the team grew, that became unsustainable — it was too error prone as a process, and the amount of back and forth was draining.” James Jill, CEO at GoSquared (read our case study)

The advantage of using time off software like CharlieHR is that all your time tracking admin runs by itself:

  • Time off allowances are calculated automatically

Time Off Tool for HR Automation

  • Your automated calendar gives everyone in the team full visibility on who’s in and who’s away
  • Team members can request time off through the platform and line managers can approve or deny with a single click.

Time Off Tool for HR automation with Requests sent to manager

2) Employee onboarding and offboarding

The success of small companies and startups depends on the (few) people who run them. Onboarding is the most important opportunity you get to make a good first impression and to set up new hires to thrive in their role

Click here to download HR for startups

However, small companies without a HR department can struggle with the load of manual tasks they need to just to get the employee onboarding process started. P45s, Right to Work documents, contracts of employment, next of kin... There are a lot of loose ends to tie up.

If you’re managing all of this manually, you’ll likely get trapped in endless email threads with the person you’re onboarding. Even when you get all the information you need, you then have to find somewhere safe to store it, and then enter everything manually again.

Automating this process can save you a lot of time while also making sure no sensitive information gets lost. Let’s see what that looks like using CharlieHR’s onboarding as an example:

  • Self-serve HR process: new employees complete their own onboarding admin. They can upload all their documents and fill in their details on the platform, even before their first day.

All the benefits of getting CharlieHR for HR automation

  • Quick and consistent: you simply need to invite the new team memberto the platform — the system will do the rest
  • Compliant: the system reminds you of all the steps you need to take to be legally compliant. And you can create bespoke checklists to make sure everyone does their part.

Want to take Charlie’s time off or onboarding features for a ride? Start your 14-day free trial.

HR automation for small businesses (company size 11-60)

Once you go beyond the 10-people mark, your small company is still in constant movement, but people’s job roles start to gradually become more defined with multiple levels of management within each team. People may feel like there are fewer opportunities to progress in their careers and pick up new responsibilities.  

This is when you need to put in place your first processes to support career progression at your organisation:

Click here to build a company that keeps its company for the long haul with a career progression framework

Of all career development processes, the one that benefits the most from some level of automation is definitely performance reviews.

3) Performance reviews

Automation here is all about facilitating the exchange of feedback between line managers and their direct reports in order to increase employee performance.

“The conversation is the most important part of the review — that’s where the growth happens, but only if people prepare.” Alisa Mistry - Charlie’s HR Advice

With that in mind, we built Charlie’s Reviews to make it easier for everyone in the team to have constructive review conversations:

  • Set up automated review cycles that are easy to roll out
  • Empower your team to exchange feedback directly through the platform ahead of the meeting

Automated reviews tool for HR automation

  • Track everyone’s progress from your dashboard
  • Send automatic notifications if anyone is behind

If you’d like to see how Charlie’s Reviews work in detail, you can take a free trial here.

HR automation for scaling businesses (company size 60+)

You’ve come a long way: your team has grown and your HR processes have lost all the scrappiness of the early days. You’ve now covered all the HR basics, and can proudly say your startup has become a solid, successful business.

You probably also have more money in the bank and may want to invest in more expensive HR automation software to cover other specific aspects of your People processes.

Here are some extras we think you could consider:  

4) Payroll

Once you get above the 60-people mark, it can become too much work for one person to manage payroll and expenses, month after month. Instead of hiring a full team to look after that, you could opt for automating the payroll process.

These are some of the most common tasks that payroll software and similar apps can do for you:

  • Setting up payroll to run automatically, each pay period
  • Automating tax filings
  • Certain platforms support multiple currencies and different benefits depending on location and team

Our HR automation software, CharlieHR, integrates with payroll software Pento – so you can manage all your HR processes in one place.

5) Recruiting

When you get to a stage when multiple teams are hiring for various roles at the same time, you’ll find it’s not possible to keep everything under control anymore.

So, similarly as with payroll, you can choose whether to:

  • Hire a full talent team to look after recruitment
  • Outsource it with a recruitment agency
  • Invest in a recruitment platform to automate this business process

The main advantage of having a recruitment system is that you can keep the process in-house — this gives you full control of how you select your candidates, something that you don’t have if you use an agency.

Recruiting software allows you to:

  • Post your job ad on multiple boards automatically
  • Oversee the pipeline and move candidates through the hiring process
  • Send automated emails to candidates and other team members

So, are there any HR processes that can’t be automated?

Human Resources have people at their core.

Automation is of course very useful, but it’s only really there to free you up from repetitive administrative tasks — so you can focus on making work better for your team.

You can take all that time that you got back and use it to do what only you can do:

  • Build successful HR policies that make a real difference in your team’s experience of work
  • Explore the steps you need to take to create a workplace that puts diversity and inclusion at its centre
  • Define a tangible path forward for every person at your company with a career progression framework
  • Handle difficult moments and every single employee issue with compassion and respect

If you’re just getting started with your Human Resource Management and think you need advice from an HR professional, you may find our HR Advice service useful and perhaps you can also have a look at our HR checklist for new businesses to help.

Best HR automation software

If you're ready to transform your company through HR automation, the next step is to find the best set of tools for your business.

Our top 5 HR software for this year are:

  1. CharlieHR: all-in-one HR solution for small companies. Easy to rollout, affordable, scalable and with a unique focus on attracting and retaining the best talent.
  2. ADP: best for recruitment. Its platform helps HR teams benchmark salaries, automate hiring tasks and perform background checks.
  3. CIPHR: best for training. It offers a  learning platform to train team members in a consistent way.
  4. Zoho: best for hourly timesheets. It's a good solution if you have a lot of team members on hourly contracts.
  5. Oracle: best for large enterprises.


If you'd like to read more about each of them, check out our guide to the Best HR software.

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