Human resource management systems (HRMS) are software applications that help
organizations manage employee data. The purpose of an HRMS is to automate and
streamline human resources-related tasks, such as payroll processing, benefits
administration, and personnel tracking. In this guide, we provide an in-depth look at
HRMSs and discuss the key features that you should look for when choosing a system
for your business.
As we mentioned, an HRMS is a software application designed to automate and streamline human resources-related tasks. The core purpose of an HRMS is to help businesses manage employee data more efficiently. By automating HR processes, businesses can save time and money on administrative tasks and focus on more strategic initiatives.
There are a number of different types of HRMS on the market, and they vary in terms of features and functionality. Some HRMS are designed for specific industries, while others offer more general-purpose tools. When choosing an HRMS for your business, it’s important to consider your business’ specific needs and requirements.
While many people use the terms HRIS and HRMS interchangeably, there is a difference between the two. An HRIS (human resources information system) is a system that stores employee data. An HRMS, on the other hand, is a system that helps you manage that employee data. In other words, an HRIS is a database of employee information, while an HRMS is a tool that you use to manipulate and act on that data.
Most HRMS will include an HRIS component, as employee data is the foundation of any HR system. However, not all HRIS will offer the same level of functionality as an HRMS. When evaluating HRMS, it’s important to consider the features and tools that each
system offers.
Human resource management systems can be traced back to the 1970s when the first attempts to automate payroll functions were put into practice. These primitive systems would lay the groundwork for the development of more sophisticated HRMS in the years to follow.
PeopleSoft introduced one of the first comprehensive HRMS in the 1980s, which included elements like recruiting, attendance, and even benefits administration.
By 2000, the practice had finally hit mainstream relevance within corporate structures as direct deposit and employee self-service had become fully adopted. And since then, the HRMS market has continued to grow and evolve. New technologies such as cloud computing and mobile devices are changing the way businesses operate and requiring HRMS to evolve with changing customer needs. As businesses' needs change, so will the HRMS they use.
There are several different types of HRMS on the market, and they vary in features and functionality. Some HRMS are designed for specific industries, while others offer more general-purpose tools. When choosing an HRMS for your business, it’s important to consider your specific needs and requirements;
An HRMS can automate and streamline a few different HR functions, including payroll, benefits administration, and performance management. By automating these processes, an HRMS can save businesses time and money. In addition, an HRMS can help businesses manage their workforce better. There are many benefits you can expect to see when you implement an HRMS. These benefits include;
While HRMS can vary and will certainly have some level of individuality, there are some core functions you can usually expect.
Perhaps the cornerstone of any decent HRMS is a workforce management function. This refers to the general overseeing of your workforce and would include everything from development to discipline.
Another key function of an HRMS is payroll management. This refers to the process of managing employee pay, including calculating wages, taxes, and deductions. While this may be as simple as basic payroll records, it can be as complex as managing overtime, labor laws, benefits, and even calculating taxation.
Employee management refers to what most people would consider when they think about HR functions. This would encompass everything from reporting on the relationship between employees and management to the basic structure of your employee’s work life, such as which location they work out of.
The process of recruitment can be a daunting one, but an HRMS can make it much simpler. This would include everything from posting job ads to conducting interviews and managing
the hiring process.
Employee engagement is a relatively new term, but it’s gaining a lot of traction in the HR world. Employee engagement refers to the level of connection an employee feels to their work and their company. This can be anything from job satisfaction to company loyalty. And the best way to manage employee engagement is by regularly conducting engagement surveys to keep a pulse on how your workers are feeling.
Now that we’ve provided clarity on the overriding functions of an HRMS let’s look at the individual features you can expect.
One of the most important features of an HRMS is reporting and analytics. The system should provide you with data that can help you to make decisions about your workforce. This data can be anything from employee productivity to turnover rates.
A basic feature that you can expect from most HRMS is the ability to store employee records in a centralized location. This is important because it helps streamline the process of managing employee data.
Another key feature of an HRMS is performance management. This refers to the ability of the system to help you track and manage employee performance. This can include anything from setting goals to tracking progress.
Many HRMS also offer time and attendance tracking features. This refers to the ability of the system to track when employees start and finish work, as well as their break times.
Another common feature of HRMS is benefits administration. This refers to the ability of the system to help you manage employee benefits. This can include anything from health insurance to pension plans.
Many HRMS also offer employee self-service features. This refers to the ability of employees to access their own records and update their information.
Security is a major concern for any business that stores data. This becomes even more salient when it involves personal data of employees like social security numbers and addresses. A data breach would not only raise all kinds of compliance issues but can genuinely harm your employees.
That's why it's so important to consider the following security concerns when you prepare to implement an HRMS.
Ready to adopt an HRMS? Here is a checklist of best practices to follow to ensure success when implementing a new HRMS:
HRMS are a necessary upgrade for any business that wants to improve its human
resources management. By automating HR processes, these systems can save time
and money while also improving employee productivity. If you’d like to learn more
about how you can implement HRMS in your business, contact one of our HR
Specialists today.