Exploring HRIS Systems: Types and Benefits

Human resource information systems (HRIS) are one of the hottest HR tech trends today. And for a good reason. There are many types of HRIS systems that help companies better manage their human resources functions. HR professionals use them to automate routine tasks, improve the results of their recruiting and development efforts, and identify and define the company's needs for new features. Business owners and managers use the systems to make more informed plans and decisions based on advanced data about employee performance and external competition. Employees can access the systems at any time to retrieve information and update their data, which is convenient for them and also saves time for HR staff.

An HRIS system is of great benefit to a company:

• Centralize employee data, including contact information and work history
• More efficient and effective hiring and onboarding
• Creation of individual development plans for employees
• Streamline employee benefits management
• Tracking working hours and time off
• Automate payroll and accounting and improve accuracy
• Increasing employee engagement and satisfaction
• Assist in compliance with HR requirements

The five types of HRIS systems

There are five main types of HRIS systems. When choosing an HRIS system, knowing the different types will help you weigh your options and choose a system that best meets your company's specific needs.

There are three types of HRIS systems - operational, tactical and strategic systems - which are categorized according to the type of HR functions they perform. Operational systems automate the core HR processes, while the other systems are equipped with advanced functions. The remaining two types - comprehensive and feature-limited systems - are based on whether the systems offer a broad or narrow range of features. The type of system that is best for your business depends on the type of business you have, the size of your company, your budget, and the tasks you want to automate.

Operational

An operational HRIS system is responsible for core HR functions and data management, including the day-to-day tasks of HR. This type of system can help with payroll and employee data management and tracking, saving time and improving accuracy through automation. These systems typically work with the processes you already use, making them more efficient and useful. If you currently perform these tasks by hand or use multiple unrelated software programs, an operational system can help make your HR workflow more efficient and free up HR staff for less routine tasks.

Operational systems are often a more cost-effective HR software solution. They are a good choice for small and medium-sized businesses that have a limited budget and want to focus on core HR functions.

Tactical

Tactical HRIS systems encompass the most important HR processes and go one step further. They provide HR data that managers and owners can use to make decisions and increase efficiency. They typically focus on staff recruitment, development and training. The information that tactical systems provide helps managers make the most of their employees' talents.

Tactical systems typically include applicant tracking systems that help you recruit the most suitable employees for your open positions. These systems make the hiring process run more smoothly and assist you with all aspects of recruiting and selection. This typically includes performance management systems that store performance evaluation data and help managers make informed decisions about employees' performance, offer them other opportunities within the company, or provide them with additional support.

Tactical systems can also analyze data about other providers in your industry. Another typical function is analyzing your employees' benefit utilization, which can help you make decisions about your benefits package to save money and increase employee satisfaction.

Tactical systems are well suited for companies that want to get the most out of their workforce.

Strategic

Strategic HRIS systems also include central HR processes and also offer advanced functions. These employee systems provide analytics that help companies set goals and make informed decisions. They help managers and owners plan with a broad horizon.

The typical area of application for a strategic personnel information system is personnel deployment planning. They help HR managers define new roles in the company and help define the positions, including compensation, required qualifications and job duties. Strategic systems also typically offer learning management systems that give employees the opportunity to develop and train to meet their new tasks and promote their learning.

Strategic systems are a good choice for companies that want to take advantage of technology for high-level decision making.

Full

Comprehensive plans support all or almost all key HR processes, including operational, tactical and strategic needs. When several functions are combined in a system, synergy effects arise because the functions interact with each other. The sum of an all-in-one HR platform becomes greater than the individual parts.

Comprehensive plans are a good choice for larger companies that need a lot of HR functions and have the budget to pay for them.

Limited features

HRIS systems with limited functionality focus on one or a few core functions, e.g. Payroll and benefits administration. Setup and maintenance costs are lower than comprehensive systems.

Feature-limited plans are often the best HR technology platform for smaller companies with tighter budgets and lean HR teams.

What should you consider when choosing an HRIS system?

Now let's look at some of the factors to consider when choosing an HRIS system for your company.

Size of the company

The larger your company, the more likely you are to have a larger budget for the costs of setting up and maintaining an HRIS. If you are a small or medium-sized business, you should look for a system that focuses on the features you need and not pay extra for the features you don't need.

What type of HR services you need

Larger companies are not only able to pay more, but also require a wider range of services. Before selecting a system, smaller companies should decide whether and which services they need beyond the core human resources management processes.

Compliance requirements

Businesses of all sizes and types must comply with local, state and federal laws in their payroll processing and record retention, among other HR requirements. In addition, you should consider your company's specific compliance requirements, which will depend in part on what type of business you run and what activities you perform.

Budget and ROI

Your budget will influence whether you choose a comprehensive or limited HRIS system and what features you can offer beyond core operational functions. You can also compare the plans by estimating the ROI you will get. Divide the cost of the HRIS (setup costs plus fees) by the amount you expect to save to calculate ROI.

Integration

If you already use HR software that you want to integrate with your new HRIS system, make sure the integration works with the HRIS you choose.

Scalability

Think about the future: Do you expect your business to grow, and if so, how much and how quickly? If you expect your workforce to grow, you should look for an HRIS that can adapt to your changing needs.

Security

If you are entrusting your sensitive employee data to a human resources management system, it is important that the system is secure. Before you decide, find out how an HRIS handles data security.

Is an HRIS right for you?

An HRIS can help almost any company that employs people save money and time. Because there are so many different HRIS systems, no matter the size of your company or the nature of your business, you can find a system that meets your specific needs.

The IceHrm HR platform offers powerful technology for companies looking to manage their HR functions internally. It's an all-in-one HR toolkit that helps you reduce time spent on payroll and benefits administration by 90%, cut implementation time in half, and reduce time spent on HR administration by up to a week per year can be shortened.

Features include human resources management, payroll, and simplified benefits administration. Would you like to find out more? Contact IceHrm to book a demo today and see how an HRIS can transform the way you manage your HR operations.

Elevate your HR operations with IceHrm's comprehensive HR platform. Streamline processes, enhance efficiency, and drive business success.