Informatization in the field of personnel management is a necessary prerequisite for its successful functioning and significantly reduces the risks of economic miscalculations and financial losses. Automation of HR management processes makes it possible to obtain additional profits. At the same time, it motivates the workforce to work even more efficiently, because it is one of the main resources of any company. The rationality of personnel policy and a well-built personnel management system are the determining factors of high business efficiency.
What Is HR Software System and What Business Tasks Does It Solve?
HR management is understood today as a wide range of tasks designed for the effective management of human resources of an organization. These tasks include the following:
- Planning and selection of personnel;
- Personnel accounting;
- The system of remuneration and bonuses;
- Staff training and development;
- Personnel assessment;
- Ensuring normal working conditions and social development;
- Staff motivation;
- Legal support of personnel management, etc.
The solution of all these tasks is laborious. Some of them can be easily formalized. But some are difficult to formalize due to their specific features (for example, non-material motivation of staff). To facilitate the solution of most of the tasks presented, business management uses hr software development services and implements effective HR software systems.
HR software systems are a set of methods, approaches, techniques, and technologies designed for the effective management of human resources of a company. Currently, most of the functions of the organization’s HR management system are automated.
To automate the HR service within the organization, an information system is being created. Typically, such systems are designated HRMS and represent a set of specific software and technologies that allow automating and improving business processes in areas such as personnel management, calculation and payment of salaries, time accounting, and document flow.
The software human resources management not only allows the coordination of the activities of various departments but also the work of various channels of interaction between staff and management. In addition, it gives HR specialists access to complete information about the employee, necessary for the best planning and control of budgets for salaries, training, business trips, etc.
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Main Varieties of HRMS
There are several types of HR software systems. But the most widespread are the two described below.
According to the degree of process automation, HR software systems can be divided into three levels:
- First-level systems. Include solutions designed for automated payroll. This is a typical software with rather limited functionality. Its further customization is impossible, and the circle of potential users is extremely narrow;
- Second-level systems. Include more advanced solutions to automate personnel accounting. Such a human resource management system is provided with good functionality for maintaining a competent personnel policy. Software of this level can be easily supplemented;
- Third-level systems. Include the most progressive solutions, which, in addition to payroll and accounting for personnel movement, allow developing individual training programs for specialists, planning promotion, and conducting certification.
Another classification of HRMS is based on the composition of functions. According to this classification, software products can be divided into five separate groups:
- Software for business calculations. Provide calculation of wages, travel expenses, bonuses and deductions, execution of work orders, etc.
- Accounting software. This includes the preparation of staffing, personnel reporting, accounting for vacations, business trips, sick leave, and maintaining personal files of employees;
- Software for business calculations and accounting. Such systems combine the first two groups;
- HR software systems with incomplete functionality. The software products of this group, in addition to accounting and settlement functions, include motivation management, personnel performance analysis, certification and assessment of the professional suitability of employees, and personnel reshuffle planning. It also defines the ways to improve the organization’s personnel management system as a whole;
- Fully featured HR software systems. This group is supplemented by the function of generating reports for control bodies or the management of the company, maintaining statistics.
Does Your Business Need a Human Resource Software System?
To determine whether hrms software development is necessary for your business, it is important to understand what tasks it can solve. Here is just a basic list, but it can certainly be expanded:
- Attract, retain and motivate the best employees;
- Achieve the effective implementation of the company’s strategic goals;
- Carry out the development and training of employees in accordance with the goals of the company and its divisions;
- Implement strategic planning for organizational change and budgeting;
- Make timely effective decisions based on accurate and comprehensive information analysis;
- Carry out accounting functions in the field of personnel management at a minimal cost.
Key Criteria for Selecting HR Software System
If you decide to implement software in the HR management of your business, you should understand that choosing an effective system is not easy. It should be preceded by a deep study of the market, analysis of the functionality of various software products, and their correlation with the needs of the company. Therefore, before reviewing the proposals from the HRMS developers, it is recommended to pay attention to several criteria and answer the following questions:
- Does your business really need an HR software system? There is no need to follow the trend of automation. The purchase of the program must be economically justified. Otherwise, the costs will be untargeted;
- Will hr software development solve existing problems? It is important to understand how the hr software program will improve the efficiency of personnel management. This will determine exactly those functions of the personnel management system that will be in demand;
- What is the purpose of implementing an HR software system in your business? Goals should be specific. This will allow concretizing the idea of the functionality of the product;
- What is the budget? HRIS software prices vary, so it is important for you to understand in advance how much you can spend on software development;
- Is the project supported by senior management? If the project is not approved by the management, there may be difficulties both with its payment and implementation in the company’s activities. Therefore, it is important to think about this in advance;
- What business processes will be optimized? Before purchasing a software product, you should make a list of business processes that it will optimize;
- What requirements must the program meet? There are several basic requirements, including compliance with current labor and tax laws. It is important to find a developer who can ensure the implementation of all requirements.
Modern technologies make possible a real revolution in HR management. Employees and management personnel get access to a comprehensive system of HR data of the organization, which increases the level and speed of decision-making, as well as automates and systematizes routine processes, allowing them to concentrate on strategic tasks. As a result of the implementation of this kind of solution, a variety of managerial procedures of the personnel department are brought to a qualitatively new level.
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