What Should an HR System Include?
An HR management system can represent the difference between an HR department that works efficiently like a well-oiled machine and one that's slow, clunky, and prone to mistakes. Pairing a Human resource management system with HR modules gives you the authority to automate and eliminate manual tasks.
When HRIS (Human resource information system) was introduced, there was a general reluctance to switch from Paper HR to electronic HR systems. They were deemed too pricey and technically cumbersome, which may have been partially true in the early days.
But now, everything has changed. Modern HR systems are more cost-effective, user-friendly, affordable and empowering. They make HR much easier by automatizing laborious processes and offering strategic data management by clicking a button only.
Nevertheless, all systems don't serve equally, and you should always check that the HR system you are considering or using is the most powerful and best value option available.
What Does an HR System Do?
You might have heard the terms HRMS and HRIS, which stands for Human resources information system. Both of these terms are interchangeable. The roots of these resource information systems stem from the 1980s when management information system (MIS) departments were handling the core business functions.
When HR information and methods became computerized, an electronic document management system was born, i.e., HRIS software. A core HR system functions to record and manage employee details. With the evolution of technology and other advanced systems, HRIS became popular. The terms are used to explain the software systems that automate HR processes and record employee information at a company.
In the 1970s, payroll was the first computerized HRM function, but it took time to adopt the technology of employee self-service and direct deposit. Today, an HRMS system offers employee record management, employee engagement, recruiting, personnel tracking, benefits administration, legislative compliance management, reporting, and other features to assist HR professionals in automating the business strategy, employee portal, and making better business/workforce decisions.
What is Meant by HR Software?
HR software is a digital solution for handling and optimizing the daily human resources operations and overall HR goals for a company. HR software makes it possible for HR managers and staff to allocate their time and resources to more profitable and productive efforts.
HR software helps a company’s human resources department by automatizing manual operations, keeping employee data organized, and making data-driven reports. This is all done with a software solution, eliminating the requirement for paper documents.
HR software can also serve managers and employees, helping with applicant tracking, time tracking, updating employee directories, attendance tracking, and performance management. Here are some more functions that HR software performs:
- Secure storage and organize employee directories
- Creating work charts and tracking approvals
- Tracking employee training for compliance and development
- Self-service time tracking
- Goal tracking and performance management
- Third-party application integration
- On-boarding, offboarding and pre-boarding automation
What Do You Need From an HR System?
An HR information system is a database that serves as a repository to store data on a company's employees, such as salary and job history, attendance and holiday data, and performance appraisals and personnel records. There are several types of HR software on the market, and knowing what level of features and tools you need to support the most important HR tasks in your company will ultimately help you choose the best type of HR software.
As a business expands, it usually becomes impossible to manage employee records using spreadsheets or paper filing systems where it's easy to corrupt or lose the data.
At some point, employers may want to think of investing in an HR information system. The right HRIS software acts as a secure database, and it efficiently helps you manage your employees across departments. Increase their level of engagement within any business size and boast a healthy company culture.
What are the Features of HR Software?
Some HR leaders have set back making the shift from spreadsheets to HR software, while they know it will improve the way their department works. This is high time to leave fickle and frustrating spreadsheets taking hours to manage the data and not give you the required insights. You spend around a third of your life at work – make it less complex by switching to HRMS (Human Resources Management System).
These are the top five features that are essential for HR software. To get a good ROI, keep these features in mind, or you'll end up choosing software that's just another challenge.
1. Centralized Employee Database
The biggest challenge with spreadsheets is changing, editing, and updating every little thing manually. Spreadsheets don't centralize data, and they don't communicate with other apps. Every time a change is made, you have to go back through all documents, programs, and systems to make the same change and update everything. It's a hassle to manage, and the chance of things going wrong somewhere along the way is high.
A centralized employee database resolves that by keeping the data in an interactive database incorporated into other programs. It updates all over the board when data is modified so that everything is always up-to-date. You never have to bother about editing multiple files or varying versions. All work is done for you.
2. Employee Self-Service
Today, employees expect requested access to the system they work on. Please give them the liberty to access their tax documents, employment information, PTO, and so forth with Human Resource Management Software with built-in self-service features. They should be able to an on-demand time off, track training, review benefits, and more. Take it a step ahead and invest in a system that offers a mobile app and enables employees to request time off when needed.
3. Automated Time Off
Time off is a nightmare to track, calculate and use, especially when you have to do it manually. Human resource software offers ease of tracking. With the right system features, you can set the way time off is calculated, and the system will automatically adjust every time an employee takes off. That way, you won't have to worry about recording the time or double-checking the accrual formula you used on spreadsheets for paid leave calculations. The computer will do it every time, removing the possibility of human error.
4. Applicant and Talent Management
Managing applicants can be just as tricky as managing employees. With applicant management, you can access a central database for organizing job vacancies and managing applicants' details to those vacancies. It makes it easier to maintain potential employee files for further reference. Between job vacancies to hiring and recruitment, the entire process will easily run with applicant management.
These five common features of HRMS software are the must-haves for an online HR software you pick. They reduce the time needed to manage HR data, which empowers you to level up your productivity. With all the time-consuming and tedious tasks automated, you can finally shift your focus to the reason you shifted to HR in the first place: to add ease to your life by helping people and offering a better employee experience.
5. HR Reporting & Analytics
It's tough to see the value in tracking HR information when you have nothing to do with it. Like marketing and design departments analyze and make business decisions, the data you gather upon past and present employees can be used to make effective changes to company policy, rules, and procedures. As in the features discussed above, the core thing required to make this happen is looking for the right software match.
Important to both Human Resource Information System (HRIS) and a good HRMS is a skill to create reports. Reports containing details about employee absences to those highlighting when most employees spend their PTO, to stats on the positioning of new hires, a powerful reporting feature can make the most of your data by saving a lot of time.
Ideally, you'll get access to a library of report templates and the ability to generate customizable reports with the help of current and past HR data. With the correct details directly at your fingertips, you'll be making far-reaching results in no time.
What Should an HR System Include?
When searching for an efficient HR platform, these are the most critical features an HR system should include:
- Document Management
HRM solutions must contain a complete directory of employee records that involve job and salary history, personal information, insurance plans, banking and tax details, discipline history, performance reviews, time-off requests, and any other details and documents which are essential for the company. This keeps all employees' records up-to-date for ease of tracking and reporting.
HRMS systems can also manage an employee portal, allowing them to log in and view crucial information and knowledge base of informative files.
- Applicant Tracking and Hiring Tools
A comprehensive HRM software helps with all human resource responsibilities through the employee lifecycle with talent management and applicant tracking as well as hiring and recruitment. This ultimate software can completely smoothen the hiring process for Human Resources departments with automated HR system features. Businesses can easily post job vacancies to multiple websites and SM channels and even use this software solution to craft a job description. As the applicants start sending their job applications, the ATS (applicant tracking system) can accept and reject candidates automatically based on predetermined criteria.
- Administration and Employee Onboarding
Poring over your onboarding process to enhance the overall efficiency. A report by Glassdoor states that strong onboarding processes are executed to improve the new hiring retention and productivity. HR management solutions assure that new hires begin their journey on the right note. They give relevant information to the new employees and acquaint them with tips, tools, and techniques to boost performance from the first day.
According to Netsuite, this can reduce the processing time by more than 50% and improve accuracy.
- Benefits Management
Managing employee benefits, including 401K contributions and healthcare, is a chief component of any HRMS solution. A human resource management software must facilitate the information and workflows for benefits. Moreover, permitting employees to enroll in benefits via the HRM lessens mistakes and extraneous work.
How HRIS Works in an Organization?
An HRIS offers a centralized database for applicant tracking operations, employee demographics, onboarding, time-tracking, compensation and benefits choices, and so much more. It's also the hub for your employee records with up-to-date information on the company's hiring portal and employee retention.
According to a survey by SHRM, around 70% of surveyed companies discovered that efficient execution of basic HR processes was their biggest nightmare.
Thus, an efficient HRIS software can lead to an incredible increase in productivity and reduced costs from your employees' operations teams by performing typical tasks like these:
- A centralized database to store employee details
- Streamlined employee onboarding
- Payroll & benefits administration
- Leave management, scheduling, and time tracking
- Retention and succession planning
- Employee self-service options
- Data analytics for detailed reporting
- Org chart
Every company is fighting a talent hunt war, with several skill sets missing, and unemployment rates are also historically low. Job applicants are interviewing for multiple companies simultaneously. which means time is critical when tracking candidates. If you keep using an outdated hiring system, the best candidates will be hired by other companies with an efficient HR system.
Similarly, too many payroll and human resource professionals become habitual using spreadsheets. Google sheets are not sustainable, and there's always a possibility of data breaches. Businesses with competent human resources departments can accept records imports and maintain data for ongoing tracking and reporting of almost all employee data.
A standard HRMS is a need of the hour for all businesses. They need to store employee details in an accessible place, track applicants, manage time, manage the hiring process and handle benefits and compensation details across the industries and any company size. Besides the basic HR features, businesses need advanced systems, accounting capabilities, and performance analytics.
Assessing your business requirements is one of the essential steps to searching for a new HRM system. Once you've figured out your business requirements, the selection or elimination of vendor options will become much simpler. Having a prepared list of HRMS features can make the HRIS software world less complicated and lead to the perfect choice for your business and employees!