Most modern businesses use some kind of Human Resources (HR) software to assist with managing employees. HR software simplifies and optimizes human resources management in ever evolving ways. By selecting an up to date HR software solution that works well with your business operations, your company can best manage its talent, keeping employees happy and driving productivity.
If you’re familiar with HR software and want to compare some of the top vendors in the industry, check out our vendor list.
If you’re not familiar with HR software or you feel like you could use a refresher on your HR tech knowledge, read on to learn more about:
- HR Software Defined
- Types of HR Software
- HR Software Features
- Benefits of HR software
- HR Software into the Future
- HR software for Specific Industries
What is HR Software?
Any business software that helps to manage employee information and HR related tasks can be considered HR software. HR software systems assist with managing people, automating manual tasks, and keeping information orderly.
HR software naturally saves labor time for managers and HR staff through automation, but it also assists with HR processes that allow for better planning, budget management, and decision making.
HR software makes it possible to see, for example, how many employees are needed at certain times of year based on historical data so that recruitment resources can be allocated and mobilized accordingly. There are a myriad of other ways that a company may benefit from relying on software rather than faulty and disorganized paper records.
The Different Types of HR Software
There are many different types of HR software that can perform a variety of HR tasks. Some solutions are comprehensive, encompassing most or all of the functions of HR management. Other solutions are specialized and offer assistance with only one or two HR tasks.
Still other solutions are flexible and offer help with core HR administrative tasks like managing a database, with the option to add modules that can assist with things like time and attendance tracking and self-service as desired.
HR software includes, but is not limited to:
- Human Resources Information Systems (HRIS)
- Human Resources Management Systems (HRMS)
- Human Capital Management (HCM)
- Applicant Tracking Systems (ATS)
- Payroll Software
On-Premises HR Software
On-premises HR software is software that is installed on individual computers and operates within a small network within an organization. The software can only be accessed and used from the computers that it has been installed on. While this may be secure and lower in cost than cloud-based software, it’s difficult to update and inconvenient for most organizations.
Cloud Based HR Software
Most HR software that is used in organizations today is cloud based. Cloud based HR software can be called up on devices that have internet access using logins, allowing for greater flexibility and mobility. This type of access is especially convenient for mobile workforces, but can also allow employees in any industry to access their own personal information and make changes if self-service options are in place.
Features of HR Software
HR software features can vary from system to system, but often include:
Core HR (Personnel Tracking)
|Current and historical salary data|
|Full time/part time status|
Time and Attendance
|PTO and sick time monitoring|
|Kiosks and/or biometric time clocks|
|Tax withholdings and garnishments|
|Tax filing and reporting|
|Employee access to personal information|
|Benefits enrollment access|
|Time off requests|
|Employee access to personal information|
|401(k) information and enrollment|
|Life events management|
|Carrier feeds (electronic data interchange)|
|Annual reviews and increases|
|Job board integrations|
|Screening and background checks|
Benefits of HR Software
The benefits of HR software can vary widely depending on the type of software that’s selected and the company’s characteristics. The main universal advantage is the labor time that’s saved doing mundane administrative tasks. This time can be redirected towards more lucrative or productive tasks that help to better the organization.
Depending on the software that’s selected and the way it’s used, companies may see a decrease in errors with the elimination of double data entry and an improvement in organization with the introduction of electronic records. Additionally, there may be space and cost savings due to minimized use of paper, paper clips, ink, and associated supplies.
Beyond these wide-ranging benefits, companies may see benefits that stem from the specific type of software or modules that were chosen, like an improvement in succession planning and employee development after implementing a robust learning management system.
Companies that select an all-encompassing HR software solution may see a number of benefits that occur across several areas of the organization. Processes may be streamlined and it may be easier to cross reference data pertaining to different elements of HR that were siloed before implementing a comprehensive system.
Benefits of Managing Payroll
Payroll is often the biggest organizational expense, so managing it effectively using HR software can save time and trouble while helping to avoid employee dissatisfaction caused by errors.
Integrating time and attendance software and scheduling with payroll functions can help a company to better control labor costs, overtime, and compliance issues like number of hours worked by minors. Analytics based on these types of integrations can enable better real-time decision making and planning.
Self-Service Options Benefits
Employee and manager self-service functionality can help to improve communications while boosting autonomy within the company. This is becoming a popular HR software module, particularly when the feature is mobile optimized.
Allowing employees to access information and schedules, submit changes and time-off requests, and even take charge over their own development and training can improve satisfaction and productivity while saving management time. Allowing managers to perform tasks and address time-off requests while on the go can improve operations and make for more timely actions.
Improvements in Recruitment
Recruitment is becoming more employee-centric and digitized, so using HR software to help with recruitment can assist with attracting top talent. HR software often integrates with top job boards and social media sites to post jobs where the best employee candidates will see them. HR software may also assist with the interviewing and onboarding processes for more streamlined hiring.
HR Software and Your Company’s Future
HR software provides companies with tools that can aid in flexibility. This can be instrumental in adapting to the following universal shifts in the way that many workforces operate:
- From a hierarchy to a flatter structure with an emphasis on teams
- Employee-centric development, rather than scheduled classroom-style learning
- Using analytics to recruit strategically versus hiring reactively
- Working and connecting remotely as opposed to strictly in office or face-to-face
- Developing a big-picture focus that cross-references financial factors with HR
- Catering to part-time, temporary, contract, and gig workers as opposed to only full time staff
- Providing continuous feedback, coaching, and recognition instead of annual appraisals
- Promoting transparency as a vehicle for fairness and increased diversity
Flattened Organizational Hierarchies
Hierarchies in which top management passes down goals to lower and lower levels of management until those goals are broken down into specific tasks for front-