HRMS Software: Benefits, Content, Requirements, Types

HRMS Software supports HR work by digitizing HR processes. As a result, HR departments experience administrative relief above all. Furthermore, HR professionals and employees benefit from intelligent software functionalities for both operational and strategic HR work.

What Does HRMS Software Include?

HRMS Software can map different personnel areas and personnel processes. The most common are:

• Recruiting
• Onboarding
• Target agreement & performance assessment
• Development planning/personnel development
• In-company training
• Succession management
• Compensation and benefits
• Payroll accounting and electronic mailing of payroll
• Time management
• HR master data /  digital personnel files
• Reporting & analysis
• Social collaboration
• Appointment management
• Travel management 
• Workforce planning 

Most HRMS Software products have a modular structure. This means that the software supports different personnel processes as required. What is not required therefore does not have to be paid for. This also reduces the follow-up costs for maintaining and servicing the software.

What Are the Advantages of HRMS Software?

HRMS Software can be used for a variety of reasons. Usually, several advantages come together:

• Administrative relief and time savings through standardization of tasks and processes
• Uniform HR data basis (across locations and countries)
• Better service and process quality
• Cost reduction through streamlining and simplification
• Secure HR data storage and compliance with data protection and the GDPR
• Easier collection of data
• Better evaluation options and easier reporting
• Great user-friendliness, also for managers and employees (Employee Self Services)
• Better access options through the use of apps for smartphones and tablets

There are therefore advantages for employees, managers, and HR managers. 

Who Is HRMS Software Suitable for?

As soon as companies employ their own employees, HR activities arise. HRMS Software is therefore aimed at companies of all sizes and in all industries. The software providers usually focus on a specific segment, such as craftsmen, medium-sized companies, or corporations. Which software fits the company should be clarified with the provider. This can be compared with the average company size of the existing customers, for example.

What Types of Models of HRMS Software Are There?

There are basically two models available on the market:

1. HRMS Software as a purchase

When purchasing software, the software is acquired via a license agreement, but an additional recurring fee (usually per user) must be paid.

Through the purchase of the software resulting advantage is that the software itself more closely aligned can be. Configuration, as well as new developments and modifications, are possible. But the effort is greater and so is the maintenance itself. However, there are also pre-configured software solutions as packages. 

2. HRMS Software as a service

With the Software-as-a-Service (SaaS) model, the software and its use are only rented as so-called cloud software. Cloud software is made available via the Internet and this is also where the user accesses the software application. There are costs per user, often called subscription costs.

Because the software is only rented, customer-specific adaptations can only be made possible within a given framework via configuration. The positive aspects are the lower costs for introducing and maintaining the software.

Both types/models incur additional costs for:

• Introduction / implementation
• Adjustment / maintenance
• Support

These services can either be billed at a flat rate or according to expenditure.

What Are the Requirements for HRMS Software?

Ease of use: Intuitive operation and easy to find information and functions are important with any software selection.

Data security: GDPR-compliant and data storage within the EU is important.

Degree of coverage of requirements: Appropriate HRMS Software should be able to map the desired personnel processes. Generally better if the software can map as many HR processes as possible, even if these are not yet needed in the first step.

Modularity: If the software can be implemented per module (i.e. per process), then this is an advantage. Because not everything can be introduced at once, as that means effort. Thanks to the modularity, the system can be expanded very easily later.

The seriousness of the software provider: Since sensitive data is processed with the HRMS Software, the provider should be known on the market and be able to demonstrate a long-term strategy.

Innovation: HRMS Software should continuously improve and expand its scope and functionality. This is the only way to ensure that the software is not out of date and, in the worst case, no longer meets the legal requirements.

User acceptance: There are numerous opportunities for you with powerful HRMS Software. However, the potential can only be fully exploited if many users are also convinced.

How Do You Choose the Right HRMS Software?

There are many HRMS Software on the market. Not all of them fit the needs and requirements of the company and its users. The following points are helpful when choosing HRMS Software :

Step 1: Clarification of needs - Why should (new) HRMS Software be purchased? What is the goal?

Step 2: Define requirements - what does the software have to be able to do and what must it support?

Step 3: Selecting the software - which software suits your needs and requirements?

Step 4: Select implementation partner - Who will carry out the initial implementation and also provide technical support?

Step 5: Establish responsibilities - who is responsible for what and when?

Step 6: Test phase - Does the implemented system match our requirements and the agreed content?

Step 7: Rollout - How can the new software be rolled out in the best possible way?