HRMS: What Is It & Why Companies Need to Use It

An HR management system makes HR workflows less complicated, enables a clutter-free work environment, and eliminates human error, among other benefits.

Is this tool new to you, or have you heard about it BUT have not used it? If yes, then carry on reading. This article will talk about what HRMS is and how it benefits HR teams and businesses alike.

More about This HR Solution

Short for HRMS, human resource management software is an inclusive system that streamlines and manages a variety of HR-related functions, including:

• Recruiting and onboarding

• Payroll management

• Scheduling and time management

• Monitoring employee performance

• Reporting and analysis of workforce data

Through this technology, HR practitioners can automate repetitive and time-consuming tasks, consolidate employee data faster, and focus on other areas that bring more value to the company.

5 Reasons to Use Human Resource Management System

1. Handle Routine Tasks Effectively

HR specialists are quite literally the resource for humans. They recruit candidates, process payroll, conduct disciplinary actions, maintain employee records, provide training, and more.

The thing is, completing the day-to-day HR tasks can sometimes be a challenge. Routine administrative tasks, such as processing employee information and filing documents, can hurt their efficiency and productivity.

An HR management system keeps clerical tasks at a minimum. It standardizes core HR processes, including recruiting, onboarding, and performance reviews.

For instance, a department manager wants to check the training and certifications of his staff. When done traditionally, the manager should request the relevant documents from the HR manager.

If HRMS is in place, there is no need to bother the HR team for just a simple task. The software provides a central hub for information, making it easy for everyone to track and update data in real-time.

Also, this HR tech frees HR employees a time-consuming admin task—sorting through piles of documents. The system allows tracking down of spreadsheets or essential data, saving HR staff time and energy.

2. Reduce Administration Costs

Minimizing repetitive administrative tasks not only improves the HR team's efficiency but also reduces costs. This is why replacing manual transactions with automated technology saves companies a great deal of money.

Human resource management software get rids of paper-based transactions since data are processed and stored electronically. As a result, businesses can save money on printing, printing maintenance, distribution, storage, and more.

Aside from reducing the burgeoning paper costs, such an HR solution eliminates the need for hiring additional people who will tackle administrative tasks. HRMS structures all the routine work, allowing HR professionals to cover a host of HR functions with less overhead.

Here are some of the workflows that HRM system can simplify:

• Payroll

• Hiring and onboarding

• Performance management

• Workforce training management

• Time and attendance management

3. Monitor Key Performance Indicators

Key performance indicators (KPIs) enable business leaders to understand and measure the performance of their businesses.

The human resource department also has KPIs and metrics aligned with the organization’s strategic direction. Examples of such KPIs are absenteeism rate, overtime hours, time to fill, training costs, and more.

HR managers evaluate the business performance, gauge the progress, and devise a strategic plan based on the KPIs. And, this is where the HRM system comes in handy.

HRMS offers an all-in-one and digital solution to KPI management and monitoring. The software shows how long employees stay in their position and reminds HR managers when it is time to promote. It also helps monitor employee retention rates and illustrate employee stability within the company.

Furthermore, this HR technology tracks employees’ time and attendance. Such a feature enables HR leaders to determine whether the absenteeism rate impacts the business in terms of overall productivity and company finances.

4. Secured and Centralized Data

Employee data points the way toward the right direction; it helps HR managers and business leaders alike to assess the operations, identify management shortcomings, and make better decisions.

In the pre-HRM software times, data is processed, stored, and managed manually. Personnel files are printed out and stored in a filing cabinet or a designated area. While this approach works perfectly fine, it may be prone to errors and security issues.

A human resource management system works under the cloud, which means it stores data digitally. It provides a single and centralized database, wherein HR staff and employees can access easily, anywhere, and anytime.

The software offers advanced security features to ensure the security of user data. Below are a few of the features that keep organizational data secure:

• Data encryption

• SSL certification

• GDPR Compliance

• Controlled access

• Antivirus and firewall

• Strict password policy

• Port-based restrictions

• Role-based access to data

• Internal security controls

5. Seamless Reporting

All types of work, including HR processes, require reporting. Without reporting, there is nothing to fuel up the decision-making.

If HRMS is in place, human resource professionals can create reports and analyze trends or information faster and easier. This HR solution enables seamless reporting, forecasting, and preparing of action plans, thanks to the following:

• The single and centralized database allows HR employees to get processed data without sorting through file cabinets, sending emails to direct managers and other miscellaneous tasks.

• Data is paired with graphical representations, enabling HR leads to generate any reports concerning the workforce.

• The detailed and data-driven dashboards provide users with essential data and insights at one glance.

Bonus: Tips for Choosing the Right HR Software

While HR tech offers a wealth of benefits, things can go wrong when it fails to meet the business needs. It is crucial to select and implement the right software that will help do all the heavy lifting.

Here are some tips for choosing the right HRMS for your business:

• Assess the technology, its key features, and the HR vendor

• Compare the software and its performance from other solutions

• Determine whether the system is scalable and offers an optimal user experience

• Check if the HR software meets your needs and address organizational problems

• Look for a system with an ongoing software support and security team

Final Thoughts

The HR department ensures the company maintains its operations while at the same time meeting the need of its employees.

Imagine how hard it is for HR professionals to juggle a plateful of tasks if your business still relies on spreadsheets and manual processes. Now is the time to reward them for their hard work. Invest in human resource management software to further increase their productivity and your business growth.