HRMS - Human Resources Management System
Resources department plays a strategic role in organisations in myriad
areas—from salaries and wages to safety and risk management, training and
development, strategic planning, and much more. For the efficient management of
HR operations and processes, organisations can use a human resources management
A human resources management system or HRMS
is a collection of software applications built to support and manage the organisation’s
HR functions and processes. The human
resources management system aims to improve the HR department’s efficiency and
productivity by automating time-consuming and repetitive tasks.
is the difference between HRIS and HRMS?
Human Resources Information System (HRIS)
is a type of human resource management
software originally used to maintain employee records. Today, HRIS includes
many more HR-related functions such as training, recruiting, and so on.
However, an HRMS is more robust than HRIS, comprising
both human resource management software and IT. HRMS goes beyond HRIS functions
to include non-quantitative information regarding employees, such as employee
satisfaction, employee induction, job performance, and more.
functions of an HRMS
Most human resources management systems
(HRMS) include the following functions:
- Management of candidates:
Related to the organisation’s employment offers and encompasses management
of resumes, scheduling of interviews, making offers, and so on.
- Employee engagement:
Related to training and development, recognition of employees, helping
them gain new skills, and so on.
- Employee Payroll:
Payroll functions include calculating employee wages and automating the
issue of payments. Employee payroll self-service may allow employees to
retrieve copies of their salary slips without requiring HR intervention.
An example of payroll-focused HRMS Payday! HRMS is a cloud-based human
resources management system allowing HR to perform payroll processes from
- Management of employees:
Related to core HR
functions such as recording and maintaining employee information,
structuring workforce into different departments, and so on.
It can be used to optimise
the organisation’s workforce. For example, it can generate data depicting
manpower trends as well as the implications those trends may have on the
- Workforce management:
This includes tracking employee development, disciplinary actions, manager
evaluations, as well as setting up workplace policies, and ensuring a
healthy and safe work environment.
- Contingent workforce
Related to the workforce that is not full-time employed by the
organisation such as interns, contractors, consultants, and so on.
need for an HRMS
With the emergence of artificial
intelligence (AI), it is more important than ever to have the right information
at your fingertips at the right time. This is why HR functions have moved
toward automation. All types of organisations s can benefit from a good human
resources management system. Here are some areas ways human resource management
software benefit organisations:
- Data management:
With HRMS, tracking
real-time data of employees across varied functions is now possible. It
eliminates the need for paper-based data storage, allowing for greater
security and fewer errors if any.
- Cost-effectiveness and efficiency:
At a time when most companies have had to resort to working from home,
modern-day HRMS solutions such as cloud-based HRMS are highly cost-efficient.
The adoption of a human resources management system increases efficiency
saving the time and effort on mundane tasks by the HR department. For
example, leave requests can be placed and managed directly by an
employee’s reporting manager, rather than going through HR. The
streamlining of tasks by an HRMS has numerous cost benefits that far
outweigh the cost of purchasing the HRMS.
- Employee self-service:
This allows employees
access to their data related to their employment such as leave, attendance,
payroll, and more. Employees can view and download their payslips, leave
updates, and more.
- Statutory compliance:
An important aspect of an organisation’s functioning is ensuring100%
compliance to central and state laws. An HRMS ensures compliance through
regular updates to backend software.
- Easy reporting and better insights:
Human resource management
software allows HR
professionals to draw up any number of predefined statutory reports
without any effort. HR can use an HRMS to generate reports on scores of
parameters as and when required by senior management. It also provides a
quick overview of critical information on a single screen of the HR
dashboard. HRMS allows HR to analyse data better thus helping them to
catch and nip problems in the bud.
- Greater employee engagement:
An HRMS can ensure greater employee engagement as it is practically
indispensable in both developing and retaining talent. HRMS allows HR to
effectively set up training programs, create and personalise learning
plans, set up mentorships, and more. Such developmental activities are
then tracked in the HRMS, which helps HR recognise development milestones.
All this helps keep employees engaged and loyal to a company.
To protect the volumes of confidential
information stored in an HRMS, data encryption should be used to protect
information sent over the internet. Internally, organisations should use
complex passwords and have password reset policies in place. Moreover,
organisations should allow access to the information as per the employee’s job
position or role.
HRMS can be categorised into three separate
groups of providers. Based on these categories, organisations can narrow down
their choice of HRMS:
- Enterprise Resource Planning providers:
Have built-in integrations
with their other business applications such as accounting. Offer a
consistent user experience and a single security model. However, they do
not offer an in-depth experience of an HRMS specialist and the interface
may not be user-friendly.
- Service providers:
We fully outsourced and
acts as an organisation’s HR department. They are more costly with higher
integration costs, leaving organisations with lesser control over their HR
processes and data.
- Best of breed providers:
Focus on one to
three specific functions of an HRMS. Within these, they offer in-depth
features with user-friendly interfaces.
They do not offer comprehensive HRMS solutions and integrating
other business systems entail added costs.
The past few decades are marked by rapidly
emerging technology. Today, an HRMS
is one such innovative technology elevating productivity, efficiency, and
employee satisfaction at all levels in organisations. So, by implementing an
HRMS, organisations can improve their business value in today’s world.