Everything You Should Know About Human Resource Management System [HRMS]

HR is a big and important part of any organisation and it has many functions such as recruitment, payroll, training, health and safety, and so much more. It goes without saying that there’s a lot to be done in HR, which is why many companies choose to invest in technology to support HR operations – technology such as human resource management systems. Although these systems are an investment and will cost money to begin with, they are highly likely to save companies time and money in the long-term as HR functions are carried out more efficiently and effectively by human resource management systems. 

bb Everything You Should Know About Human Resource Management System [HRMS]

Looking for the Human Resource Management System ? Check out the Best A Complete Guide on Human Resource Management System [HRMS].

There are many HRMS out there in the market, each with different features and functions, so it’s important to choose the right one for your organisation. 

Table of Contents  

What is a Human Resource Management System (HRMS)?

A human resource management system, or HRMS, is a system or software that manages a wide range of HR functions and processes for an organisation. For instance, some of these functions may include onboarding, payroll, performance, attendance, offboarding, etc.

Its role is to essentially make life much easier for those in charge of HR within a company. 

It also makes life easier for employees as it’s common for these systems to have the option for self-service so employees can get stuff done at their own convenience. 

Human resource management systems streamline the company’s HR operations as these processes are automated and carried out more efficiently. This means that the HR manager and team can focus their efforts and attention on other more important matters, as opposed to routine administrative tasks (for example) that can be more efficiently carried out by a HRMS. As we’ve already mentioned, there are different types of HRMS, all with different functions and features included so it might be helpful to know what some of these features are and how these can be of use to your organisation. 

Features and Functions of Human Resource Management System

Each HR management system in the market will be different from the next, so it can sometimes be challenging for businesses to choose the best one for them and their HR needs. In order to help you narrow down your search, it’s important to identify which features you want the HRMS software to have. What is it exactly that you want the system or software to do? Which specific functions does your organisation need? 

Below are some of the common features and functions of HRMS – which of these would be the most helpful to your organisation? 

  1. Recruitment 

A common function of human resource management systems is recruitment. This is typically a module in the software which supports the company’s recruitment process in various different ways, from start to finish.

For example: 

  • Automatically sort through applications and potential candidates through a set criteria and applicant tracking
  • Make Internal recruitment easier by enabling employees access to internal vacancies through the HRMS 
  • Manage candidates throughout the whole process including interviews
  1. Onboarding 

Another way in which HRMS can support HR operations is through its onboarding features. These features allow organisations to have a smoother and more efficient onboarding process for both the employer and the new employee. 

For example: 

  • Automated onboarding checklists ensure that everything has been covered 
  • Collecting new employee details can be made easier if the new employee can use the self-service option to add their personal details 
  • Processing documents digitally through the HRMS 
  1. Compensation 

Managing employee compensation is an integral part of HR operations which can be made easier through the use of human resource management systems. 

For example: 

  • HRMS can make managing and processing payroll much easier, and it will also be less prone to errors 
  • Allow employees access to their personal documents e.g. pay slips 
  • Benefits and salary administration 
  1. Performance

Another common function of human resource management systems is performance. These performance-related features of HRMS can help to monitor the company and employee performance to ensure that everything is on track. 

For example: 

  • Performance reviews can all be done on one platform which can easily be accessed by employees 
  • Easily schedule and organise one on one meetings 
  • Managers and supervisors can give real-time feedback to employees 
  1. Offboarding

HRMS software can assist with the offboarding process to make this easier for both the employer and the employee. Ensure that everything is efficiently handled in preparation for the employee leaving the organisation.

For example: 

  • Automated offboarding checklists for a seamless offboarding process 
  • Conveniently plan and organise exit interviews and exit surveys
  • Easily manage the required documents for offboarding e.g. resignation letters 
  1. Training 

Another function of HRMS that may be useful or beneficial to companies is the training function. This essentially includes any features that support the training and development of employees to ensure that this is well-managed. 

For example: 

  • Allow employees access to training programmes that have been customised to meet their needs 
  • A learning portal for employees to gain knowledge and develop their skills 
  • Online assessments can easily be completed by employees 
  • Training reminders and notifications 

A very common function of human resource management systems is that it can be used as a database or a software to store data on. All of the data is conveniently stored in one safe space – the HRMS.

For example: 

  • Cloud-based storage 
  • Data management as required 
  • Collect and store employee information and details with ease 
  1. Attendance

If you’re searching for an HR management system with a function to track employee time and attendance, there are some attendance-related features to look out for.

For example: 

  • Attendance tracking feature to automatically register the attendance of employees 
  • Easily plan and schedule shifts 
  • Manage the absence of employees and prepare accordingly 
  • Allow employees to self check in or check out
  1. Self-service 

Many HRMS have a self-service feature whereby employees can carry out specific tasks and activities on the system at their own convenience, which can be very time-efficient. 

For example: 

  • Self-service portal for employees that they can personally manage 
  • Employees can have access to their personal data/information and update it as required
  • Allow employees access to documents such as payslips
  • Time-off requests 
  1. Analytics

Human resource management systems will commonly have features all about data and analytics. This is great for conducting analysis and gaining insights into the various different parts of HR within the organisation, as well as the HRMS itself. 

For example: 

  • Visual reports to make it easier to understand the data
  • Data analysis that can be used to improve business strategies 
  • Trend analysis to help with future decision-making 
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HR operations have become more and more complex in the ever growing digital world as more HR functions are added and processes have to constantly be updated. This is why HRMS can be extremely helpful and beneficial to organisations. 

Here are some of its benefits:

  1. Completes routine HR tasks

A human resource management system allows for routine tasks to be undertaken by the system as opposed to members of the HR team. This streamlines the HR process and improves efficiency for standardised forms and reports. It also helps to reduce paperwork and speeds up the process of creating documents as they will be set up and completed online. Essentially, one big benefit of HRMS is that it saves time, meaning that the HR team can focus on other tasks.

  1. Self-service portal for employees 

Another benefit of HRMS is that it enables employees to self-serve, for example, by adding and modifying their personal details to the centralised system. Employees could also have the option to book time off and upload documents such as doctors notes. With the ability to control their own accounts, the self-service portal improves employee satisfaction and makes life easier for them.

  1. Improves employee development 

Employee development can be tracked such as the training sessions completed by employees, as well as the certificates/qualifications earned and the outcome of their performance reviews. Human resource management systems can also send notifications when an employee is underperforming, show what development programme they are on, how they are improving their performance and meeting their improvement goals.

  1. Monitoring of key performance indicators (KPIs) 

KPIs can be monitored via the HRMS system so that key metrics are observable and measurable in real time. Employee retention is a key metric that can be analysed through the HRMS system to determine trends and evaluate retention strategies as a result. Absenteeism is another KPI that can be viewed within an HRMS system and can be analysed to determine the effect of absent employees on the business.

  1. Central data storage 

HRMS acts as a central data storage containing all employee information. The system helps to protect personal data from hackers and any unauthorised users. The data can be backed up using cloud software to ensure that no data is lost

How to Choose a HRMS: 5 Steps

When choosing an HRMS, you should follow this step by step approach to ensure you pick the right product at the right price for your business.

how-to-choose-a-hrms-5-steps Everything You Should Know About Human Resource Management System [HRMS]

Step 1) Define HR needs

You need to understand the HR challenges which your company faces. You need to define your needs and determine what specific features and functions you require from an HRMS.

Step 2) Liaise with IT Department 

You should involve your IT department to ask for their perspective of which HRMS would be suited to the IT infrastructure of the company. This will also ensure that a search is narrowed down as your IT experts will be able to indicate which HRMS would not be compatible with the business.

Step 3) Set the Budget 

You need to set the budget. This needs to include a maximum and minimum amount that the company would be willing to spend on such a system. It is important that the budget has had management’s approval before moving on to the next stage.

Step 4) Create a Shortlist 

You will need to narrow down the search to a number of vendors. As you have a specific criterion, you will need to select the most appropriate vendor to meet your needs. It is recommended to have a shortlist of 3-5 vendors who are within budget.

Step 5) Purchase the HRMS

You need to make a purchase decision. Once you have selected the best available option for your company you will need to initiate the purchase of the system and begin to implement it with the help of your IT department.

Once implemented, a HRMS can be instrumental in increasing the efficiency of the HR process whilst streamlining communication from top management right down to the junior level staff. If you have taken the time to follow each step when choosing a system, the results improve your business beyond expectations.

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Qandle is an all-in-one HR management software and it’s among 20 of the best HR software solutions globally. It has 36 apps and over 22 modules to help you with all your HR needs including core HR, talent management, and business expenses. It’s easy to set up, fully configurable and ready to go. Start your free trial or book a demo today! 

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