What Is A Human Resources Management System and Why Do You Need One?

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If a HRMS system sounds unfamiliar, you may need to take advantage of the opportunity to digitise your human resources function and make it more efficient. HR software will allow you to automate many repetitive and tedious tasks in your department so that you can focus on the more strategic aspects of growing your organisation.

Many businesses are turning to HRMS to automate essential HR tasks such as leave management, employment law compliance, the onboarding process, as well as to improve employee satisfaction, increase productivity and aid team management generally.

On the other side of the coin, trying to replace HR specialists with a software solution might not entirely ease your burdens. On the contrary, it might lead to more HR difficulties due to the loss of human input.

Let’s delve into the digitised sphere of human resources management systems to find out more!


What Does HRMS Stand For?

HRMS is an acronym for Human Resources Management System. It is a computer system that automates and streamlines the administrative tasks and functions of the human resources department.

The human resources management system collects information about the most valuable assets of an organisation, its employees. This data is then made available within the business to managers and human resources personnel who require it. This software allows human resources staff to monitor all relevant company personnel activity, automate manual tasks, store data, and analyse it. As a result, the software will empower them to make informed decisions about employees.

HRMS software makes it easier to access company resources more quickly, securely, and efficiently. HR staff can also use such systems to track employee skills, aptitudes and rewards, attendance logs, annual leave applications, and many other things.

HRMS helps managers keep track of employees. Other practical uses of some available HRMS include payroll, recruitment, storage and saving of employee information, attendance records, analysis of logistics, and making people-centric company decisions.

On the other hand, implementing an HR software solution comes with its own drawbacks, such as eliminating the expert human factor and the people-first approach to business.


Are There Different Types of Human Resources Management Systems?

There are three types of Human Resources Software available on the market. Unfortunately, they all have different acronyms. Therefore, it can be difficult to distinguish between them.

Let’s see what each one means:

  • HRIS: Human Resources Information System.
  • HCM – Human Capital Management.
  • HRMS: Human Resources Management System.


Which one is better? Which should we choose?

Simply put, an HRIS is designed to manage policies, procedures, and people within an organisation. HCM systems have many of the same components as HRIS but offer talent management and other global features like different languages, currencies, localisation, etc.

Finally, HRMS software also includes many HRIS and HCM system elements. Although the characteristics can vary depending on the developer and supplier, most HRMS software should consist of payroll, time, and attendance functions.

While the different types of HR software are proven to work in most business environments, the software cannot entirely replace HR departments or HR specialist companies. At its best, it can be used as a collaborator to HR personnel to eliminate administrative and pencil-pushing activities.


How Does a Human Resources Management System Work?

HRMS aids an organisation’s human resource department by automating manual tasks and organising employee information. It also creates data-driven reports. All of this is done electronically and eliminates the need to print documents.

Every business is different, so you can choose which apps and features you want for your HRMS. To access the platform, each user must create a username/password. Then, their supervisors can grant each employee access.

Multiple HR supervisors can access the HRMS from different locations to get real-time updates about the status of various tasks related to benefits, recruitment, payroll, and other matters.

The HRMS allows users to update their information, and the changes are automatically reflected on the platform. They are also stored in a secure cloud. The HRMS can also be integrated with other data management software programs, as the company requires, for even more ease of use.


Why Do You Need A Human Resources Management System?

An HRMS (human resource management system) is a program that automates many business functions such as payroll and benefits administration, tracking employee absences and time sheets, scheduling pay rises and scheduling time sheets.

Functional HRMS also offer other customisable features that you can tailor to your business’s specific needs. For example, a human resource management system can help HR managers digitise their departments and reap enormous benefits.


Optimise Manual HR Tasks

HR departments are often kept very busy with paperwork and administrative tasks. This presents a problem for managers as they need help to fulfil their obligations and focus on strategic issues that will add value to the company. Critical solutions are implementing a human resource management system and digitising the department’s internal processes.

The software will allow the team to automate and speed up repetitive tasks. As a result, this software will increase productivity and help save as much time as possible so that they can devote their time to other areas.


HR Department Management

A human resource management system has many advantages. It facilitates data collection, centralises information, automates workflows, and allows you to see what’s happening within your company via graphs and tables. This dramatically improves the department’s efficiency and the quality of the results.

You can optimise the following tasks with HRMS software:

  • Management for employee absence.
  • Payroll management.
  • Evaluation of performance.
  • Processes for recruitment.


Employee Management

Naturally, employees will have questions about salaries and conditions. As the company grows, it becomes more challenging to respond to all inquiries. HRMS systems include employee portals that give employees more autonomy and allow them to manage many processes independently.

  • Holliday information.
  • Check out how many days they have taken off.
  • Submit doctors’ sick notes.

The software provides employees with a tool to help them solve queries and complete many tasks without contacting the HR department.


Data Protection

Suppliers of human resource management systems must invest three times more in security than any other company because data security is essential for them. HRMS software protects against cyber-attacks and has encryption to prevent unauthorised users from accessing it.

Employees can view their payslips with their private passwords but can’t see any other information. Another benefit of HRMS systems is their ability to allow HR managers to control access. In other words, they can decide who has access and what they can access.


Disadvantages of Human Resources Management Systems

The digital management of employee data is possible with human resources management systems. You can track everything from benefits to paid time off and payroll with just a few mouse clicks.

Although this makes HR functions more efficient, it only sometimes makes them more effective. For example, your company could be in serious trouble if you forget that employees are much more than symbols and numbers on a screen.

Replacing expert HR companies that have invested many years of their life perfecting their craft with a software solution can often backfire. The software can make things easier, but human input cannot be entirely eliminated from the picture. As a rule of thumb, HR software is best intended to collaborate with HR experts to get the best out of your company.


Upfront Costs of Training, Installation, and Setup

These systems have a disadvantage: their high cost. This includes the cost of installation, training, consulting, and support.

Although you can reduce these costs by purchasing a remotely hosted system, it will likely take hours to communicate with your remote customer support representative when something goes wrong. This further reduces your productivity.


Subjectivity Loss

Managers may be tempted to promote employees based on objective data from HR management systems. Supervisors may be discouraged from getting to know their employees personally to evaluate the company’s potential staff members. A computer can only give you measurable indicators that don’t always tell all.

There are better ways to evaluate employees than computerised employee evaluations. However, they can also be impersonal and pay attention to the employee’s learning of new processes. Also, they don’t consider the employee’s positive attitude, teamwork, and other essential aspects of a happy work environment.


Information Security

Personal information is given to you by employees. Your HR management system stores everything, from Social Security numbers to marital status and private health information. This information may be accessible to several layers of management.

A non-management employee could also commit identity theft by gaining sensitive information from another employee. This breach of security can lead to legal issues and poor employee relations.


The Silver Lining

While Human Resources Management Systems are proven to be operational, their features and services usually govern the corporate side of companies. As a result, small businesses that rely on a smaller but trustworthy band of team members might be subjected to hardships and general mistrust from their employees.

For a company to follow HR standards, we recommend using a third-party HR company that will take care of any HR issues and handle the formal side of the employee-employer relationship. This is proven to be a more humane and cost-effective approach when compared to the HRMS, which is more prevalent in the US.


Who Are We?

HR Docs is a complete library of template documents created by experts at a leading UK and Ireland human resources and employment law consultancy; it makes human resources best practice easy and affordable by providing instant access for employers to all the professional HR template documentation they’ll ever need to achieve employment law compliance in NI, GB or the ROI.

Our software will allow clients to quickly download template letters, policies, scripts, expert explainer guides, and more to handle any workplace scenario.

The entire library of template documents has been meticulously compiled by highly experienced employment law and HR professionals in HR Team. In addition, the library is constantly updated to ensure it contains only the most up-to-date and legally watertight documentation.

This will not only save time and money for employers, but also provide peace of mind that any documentation issued to employees is protecting their organisation against costly tribunals.

Need to learn more about HR department automation without investing in expensive software and breaking your employees’ trust, click here to contact HR Team.

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