You've heard it before: every business needs to have a Human Resource Management System, or HRMS. In fact, you've probably heard it so many times that the words make you want to box your own ears. But there's a reason there's always been so much hype about HRMS, and there's a reason that the hype isn't about to die down any time soon. There's a reason that we, and other companies like ourselves, exist to help businesses find and implement HRMS software. The bottom line is that they're inescapably important: HRMS provide a unique and vital link between human resource management and information technology.
So Why The Hype?
HR management systems enable businesses to automate many of the tasks involved in human resource management. This has a double advantage: it not only lightens the HR department's workload, but it simultaneously improves HR efficiency by standardizing many of the different processes throughout that department. Efficiency, of course, is key – and most especially in the Human Resources sector, where half the job is basically to function as smoothly and invisibly as possible. Fairly or not, the HR department is generally expected to operate unobtrusively; successful HR administration within a business will often go practically unnoticed, and only when there are problems does HR attract much in the way of attention. The result of this is that when it comes to business management, the HR department is frequently given too little priority and consideration, and thus it is prevented from optimizing its organizational potential.
The Human Resource department, however, is of extraordinary importance to a business's integrity and development. Among other things, the HR department is responsible for recording and evaluating the activity and work patterns of a company's employees, providing upper management with valuable information to help formulate business strategies – an essential element of business success. The software industry has long been clued in to the value of human resources, and this brings us back to our original point: Human Resource Management Systems. Over the years, there have been increasing developments in the availability of applications designed to assist the HR department in carrying out their responsibilities. These HRMS are indispensable when it comes to automating a wide variety of tasks and helping to better coordinate a number of others.
The Components of HRMS
Human Resource Management Systems are loosely characterized by fulfilling the four core responsibilities of the HR department: payroll, time and labor management, benefits administration, and human resource management. Because of this, the majority of HRMS software incorporate discrete modules to independently target the requirements of each of these responsibilities.
The HRMS payroll module provides the invaluable service of automating the payroll process, guaranteeing that payroll functions are always carried out on time and without any errors. At the most fundamental level, the payroll module operates in conjunction with manual submission of work hours and attendance data based on paper time sheets completed by the employees. More sophisticated payroll systems can monitor employee hours automatically, either through a “clock in” system or a tracker linked to employee computers. Either way, once the attendance data has been entered into the system, the payroll module can automatically compute payment totals and deductions such as income tax, before proceeding to generate employee paychecks and tax reports.
Time and Labor Management
The HRMS time and labor management module is an effective tool for compiling and evaluating employee work information in order to facilitate business cost accounting. The synthesis of data taken from the timekeeping systems with the data processed through the payroll module allows the time and labor management module to present upper management with useful and intuitive data depicting the utilization of labor resources within the business.
The HRMS benefits administration module allows the Human Resources department to supervise and adjust employee engagement with the business's variety of benefit programs. These programs can be as diverse and customized as a business chooses, ranging from programs designed for employee welfare, like health insurance and pension plans, to programs geared towards making profit, like profit sharing and stock options.
Human Resource Management
The HRMS human resource management module is designed to make data organization and analysis as simple and effective as possible. This module coordinates employee demographic data with data on the business's technology, production, future goals, and more, enabling the HR department to efficiently manage its human labor resource by monitoring the development and capabilities of the workforce as a whole side-by-side with the qualifications of each individual employee. Sophisticated human resource management modules can even automate the application process for specific positions by sorting through general application data and filtering matches through to any related database.
HRMS: Tipping the Scales
The important thing to remember here is that while each of the above HRMS modules is certainly handy for the Human Resources department, that is by no means the limit of their influence – they are beneficial to the business as a whole. Human Resource Management Systems allow a business to translate information on human resources into an electronic format, enabling that information to be fused with larger, more comprehensive data pools within the business. This integration of human resource data into the broader domain of business resource planning then consequently facilitates an increase in the business's overall effectiveness and efficiency. Comprehensive and well-organized employee data is vital to the formation of business strategy; a solid HRMS can tip the scales between good, informed management decisions and ignorant executive mistakes.