Regarding actions in Human Capital Management (HCM), what is true?

Actions in Human Capital Management (HCM) are used to manage employee lifecycle events such as hiring, promotions, transfers, and terminations. It is essential for all actions to have an associated action reason, which provides context and justification for why the action is being taken. This requirement ensures that all personnel actions are not only documented but also supported by a logical rationale, which is important for compliance, reporting, and auditing purposes.

Having an action reason also enhances data integrity within the HCM system, allowing organizations to track patterns and trends in workforce changes. This practice fosters transparent decision-making processes and helps in maintaining a clear historical record of employment actions which is advantageous when conducting performance reviews or audits.

This principle ensures that every personnel decision is grounded in a predefined, documented reason, contributing to a more structured and accountable human resources operation.