When you have needed to locate an employee’s payroll record during payroll week, tracked employee absences in a spreadsheet, or attempted to keep track of upcoming compliance deadlines, it is time to stop depending on manual processes and to implement a more intelligent system for your HR Teams.
Modern organizations can no longer effectively use different systems in their HR departments. Organizations create lots of data from the time they hire to the time they retire an employee. This data must be accurate, accessible, and secure if it is to serve its purpose well. Using a manual method for maintaining this data takes time from the HR team and increases the risk associated with compliance and the operational risk of the organization.
A Human Resource Information System (HRIS) is the answer to this problem. An HRIS automates HR tasks within an organization, centralizes employee data into one location, and enables organizations to make meaningful and informed decisions about their employees. Let’s take a look at HRIS from an overview, as there are a lot of things businesses must know about HRIS.
What Is HRIS?
HRIS (Human Resource Information System) is an application that allows you to collect, store, process, and analyze a wide variety of employee-related information digitally. HRIS will hold all human resources (HR) data in one location for easy access and retrieval; HRIS will also help simplify and automate many everyday processes within HR departments for greater productivity.
HRIS merges many aspects of HR into one complete system by integrating HR policies, processes, and software. With HRIS, you can use it for managing employee records, tracking payroll, tracking employee attendance, managing employee benefits, and reporting compliance information.
Key Objectives of HRIS
- Centralized Employee Data Management
- HR Process Automation
- Regulatory Compliance and Risk Management
- Improved HR Efficiency and Productivity
- Data-Driven Workforce Decision-Making
- Improved Employee Self-Service Experience
What Are the Components of HRIS?
An HRIS is built from various interrelated components that work together to deliver smooth HR management:
1. Employee Database
An employee database provides a centralized location for managing employee personal information, job roles, documents, and employment history, keeping accurate records with quick access to all relevant information on the workforce.
2. Payroll Management
Payroll management automates the process of salary processing, tax calculations, deductions, generation of payslips, and legal compliance, reducing errors and ensuring timely and accurate payment to employees.
3. Time and Attendance Management
Time and attendance management captures working hours, shifts, leaves, overtime, and absenteeism, helping companies improve productivity and keep track of attendance records with transparency.
4. Recruitment and onboarding
Recruitment and onboarding solutions provide simplified processes for job posting, applications, interviewing, and structured onboarding, ensuring a smooth and engaging experience for the new employee.
5. Performance Management
Performance Management consists of supporting employees in developing goals, providing ongoing feedback, providing evaluations, and conducting appraisals, ensuring that there is alignment between the employee’s performance and the organization’s objectives.
6. Learning and development (L&D)
L&D modules keep track of what training programs, certifications, skills, and training progress each employee is participating in, and support an ongoing cycle of growth and future workforce capability.
7. Compliance and Reporting
Compliance and Reporting support HR’s responsibility to comply with local and federal regulations regarding HR policies, as well as provide accurate and readily available records for regulatory audit purposes.
What Are the Types of HRIS?
HRIS solutions differ based on organizational needs, size, and technological needs.
1. Operational HRIS
Operational HRIS provides routine functions for HR support, such as payroll, attendance tracking, and keeping track of employee records, while maintaining correct, consistent, and accurate information across multiple locations and time zones.
Additionally, Operational HRIS allows organizations to automate many administrative tasks, such as payroll, allowing HR departments to spend more time on employee development, support, and maintaining day-to-day operations.
2. Tactical HRIS
Tactical HRIS focuses on workforce planning, recruitment, and hiring employees, developing skills through employee training and performance management, to help organizations strategically manage staffing and develop a plan for the organization’s staffing and skill growth.
Tactical HRIS allows HR leaders to proactively predict future organizational staffing needs, as well as ways to develop employee skills and productivity through the use of structured, well-developed programs throughout the organization.
3. Strategic HRIS
Strategic HRIS provides high-level analytics and insights for long-term employee planning and developing an organization’s strategic plan.
Strategic HRIS allows leadership to make informed, data-driven, intelligent decisions regarding talent management, succession planning, and organizational growth, and to effectively use predictive workforce intelligence tools.
4. Cloud-based HRIS
Cloud-based human resource information systems (HRIS) use a web-based hosting service that provides companies with scalable human resources software and access 24/7, automatic updates, associated with the IT infrastructure.
Cloud-based HRIS also supports a remote workforce, creates greater flexibility of HR systems, reduces the amount of time and effort required to maintain individual HRIS servers, and provides organizations with a means of working together across geographical boundaries.
5. On-Premise HRIS
An on-premise HRIS stores sensitive employee and company-related data for the company, allowing more control, customization, and strong security for employees’ private data.
It also requires a large investment to implement and continuously maintain on an organization’s own servers and typically requires more IT personnel than a cloud HRIS to operate effectively in the long run.
What’s the real difference between HRIS, HRMS, and HCM?
While often used uniformly, HRIS, HRMS, and HCM serve different purposes within HR technology.
| Aspect | HRIS | HRMS | HCM |
| Full Form | Human Resource Information System | Human Resource Management System | Human Capital Management |
| Focus | Employee data and HR administration | HR operations + workforce management | Employee experience and talent strategy |
| Scope | Core HR functions | Core HR + payroll + performance | End-to-end employee lifecycle |
| Analytics | Basic reporting | Operational analytics | Advanced people analytics |
| Strategic Role | Limited | Moderate | High |
| Ideal For | Small to mid-sized businesses | Growing organizations | Large organizations |
What Are the Benefits of HRIS?
1. Centralized Employee Data
With a single secure system housing all employee records, HRIS provides immediate access to up-to-date, accurate HR information while also eliminating data errors between departments.
2. Process Automation
Through automated payroll, attendance, leave management processes, etc., the HRIS significantly reduces the amount of manual processes performed, thus decreasing the likelihood of errors and increasing the ability of HR departments to spend more time and resources on development and growth of their organisation.
3. Improved Compliance
HRIS uses alerts, audit records and compliance reporting to enable the compliance of employees with the labour law, statutory requirements and internal policies of the organisation.
4. Enhanced Decision-Making
Reporting and analytics capabilities of the HRIS allow HR professionals to track trends within the workforce, find skill gaps of employees and make informed, evidence-based decisions about how to use their employees.
5. Better Employee Experience
By allowing employees to check their payslips, apply for leave, change their contact information, etc., the employee self-service portal improves the employee experience and promotes engagement with HR services.
6. Scalability and Flexibility
The flexibility of modern HRIS allows for the growth of a company’s workforce as well as support for opening new locations and the changing HR needs of the business without significant changes to the system being required.
7. Cost and Time Efficiency
The HRIS reduces organisations’ costs related to administrative overhead and time spent on operational inefficiencies, thereby increasing productivity and lowering overall HR costs.
What Are the Implementation Steps for HRIS?
Step 1: Make Sure to Assess Business Needs
This stage of implementing an HR information system is about identifying current issues and managing the effectiveness of processes and workflows already in place. Once you’ve identified your needs, the next step is determining how to solve these problems and prioritising the opportunities for improvement across your organization.
Step 2: Defining Requirements
Defining detailed functional specifications is important to understanding what type of payroll, attendance, performance, compliance, budget constraints, scalability expectations, and how to support future workforce growth in conjunction with payroll.
Step 3: Selecting HR Software
Selecting an HR software provider requires evaluating vendors based on function, integration capabilities, security compliance, vendor implementation and training support, and customer service.
Step 4: Migrate Employee Data
The relocation of employee data will involve cleaning and validating the existing employee data for accuracy, consistency, integrity, and as little disturbance as possible during the HRIS implementation.
Step 5: Configure HRIS System
The HRIS system should be configured by customising workflows, processes, approval levels, roles, and system settings to match the organizational processes as closely as possible.
Step 6: User and Change Management Training
Providing a structured approach to training and managing change within the organization, will encourage user adoption and help minimize struggle, while also increasing confidence for all users within the organization.
Step 7: Testing and Go-Live Phase
An organization should carefully test the HRIS prior to rolling it out and resolve any issues identified during testing. HRIS implementation can be implemented in phases or across the entire enterprise at once.
Step 8: Continuous Improvement of HRIS
To ensure the maximum value of your investment, it will be necessary to consistently monitor the implementation of the HRIS, collect feedback from users, and analyse metrics to make incremental changes to improve the long-term return on investment the HRIS will create for the organization.
Conclusion
The modern business landscape no longer considers HRIS as a luxury item but rather an important element to manage the workforce. Automating many routine tasks previously done by human resources, HRIS provides an essential service of ensuring companies are in compliance with federal and state laws and also assists organizations in making more informed decisions regarding their people.
As organizations continue to expand and grow, so too will the shift from legacy HR Systems to cloud-based HRIS and supporting technology. Understanding the differences between the various types of tools available (HRIS, HRMS, and HCM) will allow organizations to select the best solutions based on their level of organizational maturity and strategic focus.
Utilizing the appropriate HRIS tool will transform human resources from an administrative function to an important partner in driving employee productivity and engagement while positioning organizations for growth over the long term.
