HR Management Software a Complete Guide for Beginners

By Techfunnel Author - Last Updated on February 26, 2020
A Brief Explanation About HR Management Software

“Train people well enough so they can leave. Treat them well enough so they don’t have to.” – Sir Richard Branson.

This famous quote is the very essence of HR Management Software, as it covers the two most crucial aspects of the employee lifecycle, namely – talent management and retirement.

No one can deny the efficacy and relevance of the well-crafted and well-customized HR Software.

Offering actionable insights into organizational talent, working on the lacking aspects based on the data derived from them, and tackling the process gaps like a pro – an HR Management Software empowers you to manage your company’s human resources in an unprecedented manner.

In the modern world, it’s not merely the number of employees, but the quality of talent that makes any business organization a successful and consistently performing venture.

And, in simple words, HR software is the technology solution that can expertly manage talent and all of its aspects.

Let us explore HR Software Solutions in entirety and find out what makes them an inevitable technology for businesses of all kinds and scales.

Let’s start with the basics.

What is HR Management Software?

The HR Management Software is a technology-based solution for managing and designing the employee lifecycle in its entirety.  It can be used by the HR professionals and organizations to manage their workforce, find out the current state of talent in the organization, managing and accomplishing the employee-related tasks, take decisions based on data-driven from the employee performance records and information and design the working plans for enhanced output.

Apart from working on the employee spectrum, the HR Software also enables the management and administration to develop and cultivate a healthy, ethical, transparent, and productive work culture that promotes and motivates the workforce.

The HR Software Solutions are, thus, the most powerful tools that can work wonders in any business scenario.

Now that we have grasped a clear understanding of the definition and application benefits of HR Software, let us move on to discuss how and why they are important for every business organization.

( Also Read: The Top 5 Work Management Software Solutions )

Why use HR Management Software?

Steve Wynn says – “Human Resources isn’t a thing we do. It’s the thing that runs our businesses.”

And, anyone who has ever managed a business (any type and any scale) can understand the right meaning of his words.

Your organization is not based on the infrastructure you have, the setups and latest technological tools you have, or the number of people even. Rather, it is useful talent and work ethics that form the core of an organization. So, wouldn’t it be great if you have an HR Software to take care of everything and every process related to your employees?

The answer is YES!

HR Software Solutions have many offerings that make a business streamlined and a thriving congregation of talented people motivated to achieve meaningful and profitable deliverables.

So, the HR Software should be used to:

  • Motivate the employees to work at their full potential
  • Offer different modules for different requirements
  • Provide real-time offerings such as track, gain, and manage insights into the real-time status of talent in any organization. This implies that the HR managers can find out the answers to otherwise hard questions such as – the percentage of employees working effectively to achieve career goals and organization goals and the percentage of employees that are not helping the organization
  • Engage and retain the employees proactively all the while, keeping the future talent needs in mind
  • Fill the Communication Gaps via the chatbots and online discussion panels
  • Allow employees and management to access all the information anytime, anywhere, and on any device with internet functionality.

We hope that you might be realizing the importance of having smart and modern HR Software.

Now, let us take one step ahead and learn about the various types of HR Systems to help you find the most suitable choice for your business.

Types of HR Systems – Finding the right one for your business:

There are a lot of options to choose from in the market. However, before we learn about the different types of HR Systems, let us learn the two major categories they fall into.

  • On-premise HR Systems

    The On-premise HR Systems are the ones that work and live on the technology resources of the company such as computers and servers etc. They have finite capacity and come with limitations of scale and customization as they are mostly developed, especially for a particular company.

    They can be a single integrated system containing the modules and features developed on a bespoke request from the company or a multi-tool system in which 3 or 4 HR systems from different sources are customized and used to manage various business processes or HR functions. They are perfect for SMBs and large organizations with limited odds of massive expansion.

  • Cloud HR Systems

    With the advent of cloud HR systems, the power and efficacy of the HR systems became endless, and it has become possible to integrate modules and features as and when required seamlessly.

Check out the various types of HR management software from both categories:

  • Human Resources Management Systems (HRMS)

    HRMS comes with the basic modules of human resource management such as Payroll, Benefits Management, and Time & Attendance management. HRMS can be considered as the first credible category of HR Software since the 1980s, which was the time when HR Software found the way into the business organizations.

    The HR giants in the market acquired the independent SMBs and start-ups to incorporate creativity and innovation with the passing time. HRMS is an on-premise system.

  • Human Resources Information Systems (HRIS)

    These systems are as varied as the entire spectrum of software companies. HRIS comprises all the products and solutions devised to manage the Human Resource Information such as payroll, employee data, incentives and benefits, legal, employment, and regulatory terms of a company.

    HRIS is basically designed to automate and design the three most crucial areas of human resource management – benefits, time & attendance, and payroll. However, this is not all an HRIS can accomplish.

    HRIS offers the following features:

    • Payroll
    • Benefits management
    • Employee scheduling
    • Recruiting
    • Self-service employee portal
    • Applicant tracking
    • Time tracking
    • Performance management
    • Accounting


    Data entry is manual and is time-consuming; however, the time consumption has reduced considerably as compared to the traditional systems. Manual adjustments and information shuttling across the various non-standardized HR tools also account for time consumption in the organizations using HRIS.

  • Human Capital Management (HCM)

    HCM software is a set of applications and tools that are designed to empower the administration and HR team to acquire, track, and develop the teams of talented employees. Hence, it streamlines and automates the process of acquiring, tracking, and developing the human resource capital in any business organization.

    The HR software falling in the HCM category offers the following features and modules:

    • Onboarding
    • Training or Training Support & Tracking
    • Recruitment
    • Performance Management


    The HCM system can be integrated seamlessly with the 3rd party applications and other HR solutions. In recent times, the HCM vendors have also started incorporating HRIS and HRMS features in the HCM solutions such as time and attendance tracking, etc.

  • Talent Management Systems

    Talent Management Systems are one of the novel types of HR systems that offer modules and features to manage more employee-specific characteristics. The four major pillars of these systems are:

    • Recruitment
    • Training
    • Performance Management
    • Compensation

    You can find all these modules as an integrated system or as separate software systems. Talent management systems empower the administration and management in hiring, discipline, scheduling, training, promotions, and many other such employee-specific tasks. They enable the HR team to check ‘who is working on what task’ and thus drive the real results in any organization.

  • Core HR

    Core HR or Core Human Resource Management Solutions are HR Software Solutions that are used to manage the core information regarding the human resources of a company.

    As the name suggests, it is the master record of any company that allows the HR teams to manage the most crucial and primary tasks in relation to human resources. Employees’ names, salary, payroll, job titles and descriptions, work permits, work hours, benefits information and eligibility forms etc – all of them are stored in the Core HR Software Solutions.

    The most common features and modules of a Core HR system are:

    • Central Database
    • Self-service portals
    • Payroll Management
    • Dashboard and Reporting
    • Leave and Attendance Management


    Most of the companies opt for the Core HR Software because it allows:

    • Error-free working
    • Well-informed core HR decisions
    • Improved HR processes
    • Quick access to core employee information
  • HR Administration software

    This is an HR Management Platform that is used to store and manage the personal data of the employees and the banking & tax information of the employees.

    Due to the taxing and banking information, these solutions must be constantly updated as per the latest norms and regulations of the local and national tax regulations. Healthcare, welfare, and other finance-related options are also included in the HR Administration software.

  • Onboarding

    The HR Onboarding systems facilitate a smooth transition of the newly hired human resources into a company. Providing a connection between the performance management system and applicant tracking system is one of the main features of this software.

  • Compensation Management

    This system is used to plan the budget, design and implement the salary structures and managing the increments, etc. It tracks the real-time data to plan and manage the rewards and also calculate the flight risks etc.

( Also Read: Best HR Management System Software for Your Company )

Key Features of HR Software:

While looking out for the HR Software solutions for your organization, you must keep these features in mind so that the business needs and management requirements are met properly. The most crucial and the most sought-after features of the HR management software are:

  • Applicant Tracking

    The applicant tracking systems track the employee lifecycle and offer many other modules such as performance management, engagement modules, onboarding, job board, interview, and resume, etc. It can be used as a standalone system or in association with any 3rd party HR performance management software.

  • Benefits Administration

    This feature empowers the HR professionals to automate the complex and tedious processes of enrolment and administration of benefits. Hence, the employers can set up rules related to benefits tiers, tax percentages, auto-enroll, and dependent types, etc.

  • Performance Management

    Performance Management allows the companies to set their own rules for annual performance assessments and employee evaluations in an automated manner. They prove beneficial in motivating employees and increasing productivity.

    Goal Setting Options, 360 Degree Reviews, Development and Training, KPIs, Employee Surveys, and self-assessments; Performance Management comprises all these modules. Using an online survey maker(1)simplifies collecting and evaluating feedback.

  • Learning Management (LMS)

    Learning Management Systems are also called eLearning systems and are used to track the education, skills, qualifications, and certifications of an employee. They are also used to connect employees with proper resources to boost their skills. LMS can be used as a standalone system or with ERP software.

  • eLearning Authoring

    eLearning Authoring tools and modules allow experts or skilled professionals in a company to create eLearning content for the other employees using technological resources such as multimedia files and the internet. They prove beneficial in skill enhancement and employee training.

  • Scheduling and Shift Planning

    This HR Software makes it easier for the HR team to manage and create employee schedules, shift plans for short and long intervals of time.

  • Payroll Management

    Payroll management software automates the financial processes of human resources such as gross pay, payroll deductions, net pay, allowances, salary, and pay-slips etc.

  • Time Tracking

    It allows the HR team and management to track and record the amount of time spent by the employees on different projects. Hourly billings, freelancer management, and time-dependent services – time tracking software find its applications in many areas.

  • Recruiting Software

    The recruitment software automates the tracking of all the applicants and is a delightful break from the traditional data entry systems. They are used by the recruitment agencies and large business enterprises to manage the bulk recruitments and ongoing applications.

  • Reporting and Analytics

    These systems automate the process of performance management and allow the management to make better decisions for investing in staffing and taking employee initiatives.

    They can be used as a part of HR performance management software or as a standalone one. Daily or weekly reports and feedback are submitted to draw inferences about current work goals and priorities and the employee experience over time.

  • Self-service

    Also called ESS or Employee Self-Service, this software allows the employees to manage their personal information and updates in an automated manner. They can enter and update their banking details, benefits, and contact information, etc.

    An employee handbook(2) can prove beneficial here. It will equip the employees with self-help documentation and simplify their inputs and efforts.

What are the Benefits of HR Software?

Now that we have grasped a basic understanding of the HR Software, its types, and features, let us take a quick look at the top benefits it offers.

  • Attracting Talent

    HR Software offers comprehensive features such as recruitment marketing, employer branding, interview scheduling, offer management, and recruitment email automation, etc. Management can leverage the strength of employer branding and candidate relationship modules to attract stellar talent for the business organization.

  • Productivity Improvement

    HR Software Solutions help the HR team to monitor workforce productivity closely and identify the areas for improvement. Tracking high potential employees, their location stats, workforce engagement, employee satisfaction, time saving and devising employee engagement strategies – there are countless benefits of HR software when it comes to productivity improvement.

  • Enhance Employee Retention

    When your company has a great culture that is oriented towards the employees, boosts them to give their best at work, and keeps them engaged, employee retention certainly increases.

  • Boost Employee Engagement

    Employees drive the company, and engaged employees drive the revenues. HR management software is able to gather data reflecting employee engagement and performance to offer you valuable and actionable insights into real-time employee engagement. You can then work on them to make your workplace more engaging and employee centric.

  • Creating a healthy and employee-centric culture

    Nobody likes to come first when it comes to task distribution, and second when it comes to benefits. Do employees feel motivated at your company? Are they actually able to make use of their talent that compelled you to hire them in the first place? The collaboration and communication modules offered by the HR Software empower the management to find out the work culture at their company and to make it better over time.

    Now, let us move on to learn about the miscellaneous points of information regarding HR software.

What is Cloud HR Software?

Cloud HR Software is the HR Management platform that resides on the cloud server and the company computers. Mostly, the functional components such as customized modules reside on the company resources. The other operational components reside on the cloud server. You can add and remove the modules and features as per the requirements.

Best HR software vendors by specialty

HRIS Performance Management ATS & Recruiting Learning Management Employee Engagement
Netchex Workforce Now SmartRecruiters Docebo Culture Amp
ADP Paylocity Zoho Recruit LearnUpon Trakstar
APS Workday HCM Jobvite iSpring 15Five
Ascentis 15Five Greenhouse eFront Kudos

Frequently Asked Questions

Q. Which HRIS system is the best?

A.There are many commendable options when it comes to HRIS. Some of the best HRIS systems are:

  • Namely
  • Netchex
  • ADP
  • APS

Q.What are some examples of HRIS systems?

A. Some examples of HRIS systems are as follows:

  • Netchex
  • ADP
  • APS
  • Ascentis
  • Ceridian

Q.How much does an HRIS system cost?

A. The cost of the HRIS system depends on the number and types of modules and features you choose for your business organization. Sometimes having a standalone HRIS software for a company becomes more expensive as compared to having 2nd or 3rd party software and vice versa. So, the cost totally depends on your needs.

Q.What is the HRIS system used for?

A. HRIS is used to manage the HR information such as data tracking, data information, data entry, bookkeeping, and payroll. etc. So, you can also understand it as a central database of a company’s human resources.

5 popular HR Management Software are:

  • Netchex
  • ADP
  • APS
  • Ascentis
  • Ceridian

Techfunnel Author | is an ambitious publication dedicated to the evolving landscape of marketing and technology in business and in life. We are dedicated to sharing unbiased information, research, and expert commentary that helps executives and professionals stay on top of the rapidly evolving marketplace, leverage technology for productivity, and add value to their knowledge base.

Techfunnel Author | is an ambitious publication dedicated to the evolving landscape of marketing and technology in business and in life. We are dedicate...


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