Everything you need to know about Human Resources Information Systems
HR professionals carry the weight of the workforce on their shoulders. From building hybrid work policies and updating employee handbooks, to ensuring worker wellbeing and designing attractive talent experiences, there's a lot going on.
Under pressure, HR professionals try to tackle too many tasks at once, continuously context-switching between email chains, Slack channels, spreadsheets, and legacy systems, which destroys productivity. Back and forth, entering data, typing passwords, responding to comments, copying text, opening browser tabs, and trying to keep track of vital employee records—there's little wonder why 98% of HR professionals feel burned out.
But there is a way around this mayhem that will improve the daily lives of your HR teams and your overall employee experience. The solution is to use an Human Resources Information Systems (HRIS).
What is an HRIS?
A Human Resources Information System, or HRIS, acts as a digital filing cabinet that stores your employee profiles or records. Each may include the following information:
- Employee's name, address, and date of birth
- Job title, salary, and employment status
- Employee performance evaluations and disciplinary actions
- Benefits enrollment information
- Training and development records
- Time off requests
Gone are the days of sorting through piles of paperwork or searching through multiple systems to find the employee information you need; instead, your HRIS streamlines the process and allows for efficient employee data management from an accessible, single source.
Types of HRIS
Not all HRIS tools serve the same purpose, with different types available according to your business requirements.
- Operational HRIS systems support your team’s core HR functions, including payroll software and tools for tracking essential employee data.
- Tactical HRIS systems handle specific functions such as talent acquisition, L&D, or employee performance management.
- Strategic HRIS systems support your business goals, such as workforce planning or succession planning.
- All-in-one HRIS systems encompass all HR processes, including everything we’ve covered so far.
- Modular HRIS systems enable HR teams to build a bespoke HRIS system by adding relevant modules on top of a core foundation.
Who uses an HRIS?
Anyone involved in executing or viewing HR processes can benefit from using an HRIS, including:
- HR professionals
- Hiring managers
- Benefits administrators
- L&D teams
- Payroll administrators
- Employees
With different levels of access and permissions, each user can take advantage of the system's features to carry out their tasks and responsibilities efficiently. For example, employees may use HRIS software to request time off or view their benefits information, while payroll administrators use it to process paychecks and monitor employee hours. Similarly, HR professionals rely on the HRIS for various tasks, including recruiting, performance management, and regulatory compliance tracking.
What are the benefits of using an HRIS?
An HRIS solution is an investment, and like any asset you purchase for your organization, you’ll want to understand its potential return. Here are some of the top benefits you can expect from implementing an HRIS system:
Boosting productivity
An HRIS streamlines your HR processes, increasing efficiency for everyone involved. Storing all your employee data in one place improves productivity as there's no need to switch between different tools or systems. As a result, HR professionals can focus on more strategic tasks instead of the traditional administrative burden.
This productivity yields fantastic results, with a human capital management firm i4cp survey reporting a direct correlation between HRIS effectiveness and organizational performance. Specifically, high-performing companies, in terms of revenue growth, market share, profitability, and customer satisfaction, were 15% more likely to agree that their HRIS is more effective than low-performing companies.
Making data-driven decisions by analyzing workforce data
An HRIS provides data on tap to influence your HR decisions and ensure they align with your organization's goals and objectives. For example, you might use the data to identify talent gaps, assess employee engagement, or readjust staffing levels. With real-time access to critical metrics, HR teams can monitor trends, identify potential issues, and make proactive decisions to address them.
Hiring independent contractors
Contractors can be a cost-effective way for companies to meet customer demands, accommodate one-off projects, and build a flexible workforce during uncertain economic times. Although contractors will fall outside of your typical HR processes, your HRIS can:
- Store contractor information such as contracts and payments
- Track billing rates for contractors
- Monitor contract end dates to facilitate renewals or termination
HR thought leader Josh Bersin expects the industry to see a significant uptick in companies using their HRIS system to store contractor details. He explains,
“The growth in hybrid, contract, and gig work is astronomical. Most of the pharma companies, tech companies, and distribution companies we talk with have 40-60% of their workers on contract. These individuals need scheduling systems, payroll, and various forms of onboarding, benefits, and information security. Now that more full-time workers want to work on a gig basis (baby boomers in particular), this may be a year that this category collides with core HR. I know many companies operate this way now.”
Improving your employee experience
Employees want and expect a smooth, frictionless experience at work. Along with offering self-service features, your HRIS can support your organization by reducing the chance of errors creeping into the employee experience. Take payroll, for example; Quickbooks reports that 1 in 4 employees has received a paycheck, including an error, at some point during their careers. This can happen when payroll staff miskey digits copying information from one software to another. An HRIS reduces the admin here by automating processes like payroll and accounting functions from a single platform.
This type of operational efficiency is critical to restaurant chain Jack in the Box, which relies on UKG Pro® to provide an exceptional employee experience. “The solution's support of our specific requirements gives me the confidence that we are paying our employees accurately, and I'm not required to undertake a daily audit,” said HRIS manager Nicole Brogdon, highlighting its positive impact on payroll.
Achieving compliance
Compliance is a top priority for organizations with HR teams who must keep track of ever-changing labor laws, regulations, and reporting requirements. With an HRIS, HR professionals can stay on top of compliance by:
- Managing employee records
- Generating reports
- Automating audits
Choosing a software vendor that continuously updates its systems to comply with new legislation gives HR teams one less thing to worry about.
HRIS, HRMS, and HCM: What are the differences?
You may hear the terms HRIS, HRM, and HCM used interchangeably to describe centralized HR tools, but there are subtle variations between each:
- Human Resource Information System (HRIS): A single source of truth that stores key employee information used in people activities such as payroll, benefits administration, and recruiting.
- Human Resource Management System (HRMS): An overarching solution that includes an HRIS but may also involve talent management features related to L&D, performance management, and more.
- Human Capital Management (HCM): A strategic tool that takes a holistic approach to managing employees as valuable assets to the organization, with features available for workforce planning, talent analytics, and more.
If you feel lost in acronyms, it's more important to understand whether your choice of HR platform is future-facing. This boils down to choosing a full-suite, cloud-based platform that can adapt alongside your organization.
Cloud-based platforms are modern and flexible, ensuring that your HR teams can access key people data anytime and from any location. Additionally, a full-suite solution combines all aspects of your people function, enabling seamless processes between every arm. For example, payroll, benefits administration, and L&D data can all come together, enabling employees to receive an L&D stipend paid directly into their monthly paychecks as part of their employee benefits.
HRIS examples according to business size
There are multiple HRIS examples in the market, each aimed at different sizes, budgets, and industries. Here's what to look for as you consider different vendors during the selection process:
HRIS for small businesses
Small organizations need a lean solution that serves their core HR needs as they focus on business growth. These systems aim to streamline HR processes, enhance data accuracy, and make life easier for small business owners and HR professionals.
UKG Ready® is a game-changer in this category, offering a consistent user experience from a single software solution. Small businesses will love the following features:
- Talent: Our range of intuitive recruitment tools will attract highly skilled people to join your ranks.
- Compliance: If you lack in-house expertise in legislation, our compliance software ensures you adhere to regulations and minimizes the risk of penalties or audits.
- Analytics: Our reporting function arms you with valuable insights on topics like flight risk and employee fatigue to retain your people longer.
HRIS for midsize companies
Scalability is key for midsize companies, with a focus on efficiency as your headcount and operational processes mature. UKG Ready can scale with your business, making it suitable for both small and midsize organizations. Here are some of the features to support your business as it progresses:
- Scheduling: Simplify staffing by allocating your people where they’re needed most.
- Time tracking: Handle all your attendance and leave requests with automation, so there’s no need for spreadsheets to track your people.
- UKG FleX:Enhance the employee experience with a range of FleX tools, such as Insights, Fabric, Flow, and Dev, which leans on artificial intelligence to shape a people-first culture.
HRIS for enterprise
Enterprise companies are typically complex, with large headcounts, multiple locations, and an HR team that must manage the data of a diverse workforce. UKG Pro is an example of a culture-driven HRIS for enterprise-level organizations, which creates truly meaningful experiences for your people. Along with the core HRIS features available in UKG Ready, Pro also offers:
- Strategic workforce planning: Rely on data to predict, analyze, and address the gaps between today’s frontline workforce today and tomorrow’s human capital needs.
- HR service delivery: Make it easier for HR to support your people with a consumer-inspired employee self-service portal.
- Great place to work hub: Combine research, employee voices, and data to turn actionable insights into an equitable, inclusive culture.
Maximize your HRIS ROI with these features
Anticipating what you'll need from your HRIS can be challenging as you grow, even with a robust, forward-thinking business plan. To set you off on the right path, we recommend these core solutions:
Human resources
A robust Human Resources component enables people teams to provide impactful talent experiences with highly customized support and AI-powered guidance.
Payroll
People-focused pay should be flexible, automated, and accurate. With instant access to pay projections, your company can keep track of expenses, make real-time adjustments, and ensure pay equity across the board.
Employee time tracking and attendance management
Maximize productivity among HR professionals by automating timesheet approval processes and leave requests. Automatic calculations of hours worked, overtime, and holidays also ensures compliance.
Compliance
Reduce risk by choosing a platform that lets your business stay agile in the face of regulatory changes. Whether you need to adapt to local or global laws, you’ll want a solution that keeps pace and adapts automatically to ensure compliance.
Reporting and analytics
In-depth data fuels personalized professional development by offering career suggestions, growth plans and anticipating future needs. Regardless of your organization’s size, your solution must be able to spot trends in your data, guiding you to find opportunities for meaningful people growth.
How to overcome HRIS Challenges
Implementing an HRIS can be a leap and may even cause a few headaches if you're unprepared. Luckily, many of the top HRIS challenges are easy to overcome with some planning:
Multiple systems
If you're using separate platforms or even multiple vendors for key functions like recruitment, employee onboarding, payroll, and L&D, trying to gain an overview of your entire talent experience can be a nightmare. Choosing a unified HRIS is the solution, ensuring that each part of the puzzle fits with the others. According to i4cp research, 78% of companies using multiple HRIS systems plan to consolidate to a single solution in the future, or are currently consolidating them.
Customer service and IT support
Once you’ve imported your people data over to your new HRIS, you’ll want peace of mind that support is available if any issues arise. Set yourself up for success by choosing a vendor with exceptional customer service and IT support baked into your pricing plan.
Reporting
Choose an HRIS offering robust reporting features that give you the lowdown on metrics like attendance, turnover, benefits, compensation, and more.
Scalability
Evolving businesses grow, move into new markets, or go through mergers and acquisitions. Your HRIS may accommodate your people now, but are you confident it will match your future needs? Stay prepared by choosing a vendor with a track record of supporting growing businesses.
HRIS implementation plan
Whether introducing a brand-new HRIS or updating your existing system, following a well-considered implementation plan is critical to smooth adoption. Forbes Council Member Ryan Harris suggests that the entire process may take nine to 18 months, encompassing the following stages:
Stage 1: Request for Proposal (RFP) requirements
Consult key stakeholders from multiple departments, including HR, IT, and finance, to identify the features and functionality they require from an HRIS. The greatest challenge at this stage is that stakeholders may not know what they want, which is where vendor guidance is essential.
Stage 2: Vendor selection
As a best practice, speak with a range of vendors to determine what they can offer your organization. Consider some of the following:
- Employee headcount
- Requirement for advanced integrations
- The company’s maturation stage
Stage 3: Scoping
Following vendor selection, review your RFP requirements and consult with necessary stakeholders to develop a realistic timeline for your implementation. Consider if any roadblocks exist, such as technical limitations or information security regulations, and put solutions in place to overcome them.
Stage 4: Building and implementation
Customize the HRIS to meet your organizational needs, and set up integrations to other key tools, such as communication platforms, as required. Your implementation team can stay on track by meeting milestones on time, consulting with multiple stakeholders, and collecting regular feedback from your HRIS users.
HRIS adoption and communication plan
Your HRIS could offer all the features in the world, but the platform will only be valuable if your employees know how to use it. Follow the below steps to ensure change management success:
Know your audience
Tailor your communication plan to the level of technical skill within your workforce. You may also want to segment your audience by role, ensuring that each group receives personalized guidance on using the platform daily.
To engage your employees with the HRIS concept, tell them a story and answer their “What’s in it for me?” questions and concerns.
Set goals for your HRIS
Pinpoint some goals for your HRIS to understand if your employees have adopted the platform successfully and that it's achieving the desired results for your company. Nail this step by following the SMART framework to choose specific, measurable, attainable, relevant, and time-bound goals.
An example SMART goal might be:
- To save X hours in HR each month by reducing manual employee data management
- To increase employee satisfaction by X% before Q1 by offering a self-service HRIS portal
- To save X hours on benefits management during open enrollment season by automating tasks in your HRIS
Choose your communication channels
Spreading awareness of your HRIS involves choosing the communication channels your workforce will engage with most effectively. This might include:
- Sending instructional guides out via email
- Providing nudges or setting up a dedicated FAQs channel on Slack
- Holding HRIS workshops or employee training sessions
- Posting updates on your company intranet
- Using town hall meetings to highlight the importance of using the HRIS
- Publishing success stories on social media to share HRIS adoption effectiveness
Remember to keep your approach inclusive. For example, avoid holding onsite workshops that don't include your remote team members.
Collect employee feedback
Engaging employees and collecting feedback can be a powerful combination for improving HRIS adoption rates. You might use the following methods to gain these valuable insights:
- Pulse surveys
- Focus groups
- 1:1 meetings with your HR team
Make it clear that you value and welcome all employee feedback, tell your people how you'll use the data, and thank them for taking the time to comment. To improve participation in your feedback process, communicate any changes you've implemented as a result of employees offering their thoughts and opinions.
Monitor progress
To ensure your HRIS meets the goals you set at the beginning of your implementation journey, use relevant metrics to track your progress. For example, hours saved, mistakes reported, employee retention rates, etc.
Additionally, check in with your team regularly to ensure they’re using key features and know how to use them effectively. Analyze data reports from your HRIS and make adjustments along the way to ensure you’re hitting your goals.
HRIS success model
Another way to measure the success of your HRIS is to look beyond the system itself, and consider its impact on other areas of your organization. A research paper on "The Employee Perception of the Human Resources Information Systems' Success," published in the International Journal of Business and Management Innovation, created a model to illustrate HRIS success based on these essential criteria:
- System quality
- Information quality
- Usefulness
Ease of use
When users rate each of these HRIS system elements highly, this indicates that they positively impact User Satisfaction, and therefore achieve the outcome of HRIS success.
Launch your HRIS with UKG
UKG offers an easy-to-use, comprehensive HRIS platform that can streamline all of your HR processes and improve employee engagement. Best of all, with UKG Launch Ready Boost we can accelerate your time to value by offering a go live experience in under 100 days.
Ready to set your people teams, your employees, and your organization up for success? Take a product tour of UKG Ready and UKG Pro today. Feel free to contact our sales team with any queries.
