Benefits of HR Software
4 min readFeb 27, 2023
The principles of human capital management dictate that most people within an organization will interact with HR software at the same point during their careers. It is widely used by employees to manage the many important matters that aren’t directly related to their jobs or tasks but are part and parcel of the employee experience, including time off, benefits payroll and more. It is leveraged by human resources professionals and leaders in the department to streamline the process of collecting and maintaining accurate employee-related data and making sure the business is in compliance with federal and state health, safety and labor laws.
Managers use HR software to help employees develop new skills and progress in their careers and to track their performance, as well as scheduling employees for work and making note of any workplace issues. HR software includes:
- HRMS or HRIS functionality helps HR manage personnel information; payroll; and benefits administration and HR service delivery functions, such as HR help desk and employee self-service.
- Workforce management functions include time clocks, time off and absence management and scheduling.
- Talent management functions, such as recruiting, on-boarding, career planning, performance, learning and development, compensation and succession planning, help HR teams stay on top of what skills the company needs.
The benefits are as follows :
- Efficiency and productivity: Almost majority of the organizations are using HR software to facilitate information gathering or add process efficiencies.
- Employee experience: The largest decline in employee engagement was among those in managerial or leadership positions, and among other trends, was more pronounced for those working onsite vs. at home. The tools found in HR software play a role in enhancing the employee experience. Some examples are like measuring sentiments regularly with pulse surveys, connecting people with apps that allow for peer recognition and offering discounts on benefits.
- Employee development — The HR software provides the ease of performing top functions like recruiting, onboarding and performance management with accuracy and efficiency. Getting good people on board is important but keeping them is even more so — the experience and morale functionality mentioned above play into retention efforts.
- Cost savings: Managing payroll and benefits costs is a top priority for all organizations, given that salaries, payroll taxes and benefits are generally among the largest line items. HR management systems provide human resources teams with a number of ways to save, without cutting back on the employee experience. By better tracking data around benefits, a company has more leverage to negotiate rates with carriers.
- Reduced errors: Automating payroll is a high-value area for small businesses because manual data entry results in the most payroll errors. Besides the time required to correct mistakes, errors in tax withholding open the company up to IRS penalties.
- Regulatory compliance: Making sure the business is complying with regulations at the state and federal level has long been the responsibility of human resources — and that job is only expanding in scope. HR must now account for HR compliance violations borne of everything from cyber security breaches to entirely new work models and changes to labor laws brought on as a result of the pandemic.
- Attendance monitoring: Time card fraud happens, and it costs organizations time and money. Time clock systems require employees to swipe their employee IDs to punch in, which eliminates some of those issues. They add another layer of security by requiring manager approval and can also be configured to send alerts to managers if timelines aren’t adding up.
- Simplified benefits administration: The process of designing and managing employee benefits is complex, even for small companies. Keeping up with changing government rules and regulations and the time required for administration and paperwork are also challenging. Benefits administration functionality in HR software automates calculations of benefits eligibility, allows self-service by employees to pick coverage and integrates with payroll to make sure the correct amount is deducted from the employee’s paycheck. This is more accurate and saves time.
- Data security: HR, working with the internal communications team, must ensure that relevant security policies are kept up-to-date and that employees know how to identify and what to do with, for instance, phishing emails that contain malicious attachments or links. HR software processes keep policies current and ensure employees have signed off. On the HR side, the system provides role-based access and rules in the system that guard against unauthorized access to employee data in the first place.
- Metrics: Access to metrics for analysis is critical for HR cost management, compliance risk management and improved employee engagement. The top source of that information is the HR system. Easy access to data that is both accurate and that can be viewed in real-time helps the business connect metrics to business goals. For instance, organizations trying to rein in recruiting costs can easily track crucial metrics, such as time to hire and cost per hire, alongside voluntary and involuntary turnovers. This helps tie costs to quality of hire.
- Improved decision-making: When HR professionals aren’t spending lots of time on administrative tasks and can trust that day-to-day benefits, payroll and personnel administration are accurate, they can focus on improving the overall employee experience. If the benefits administrator isn’t mired in trying to ensure compliance and providing reporting, she can look for new ways to educate and engage the workforce on the benefits available to them — thereby raising morale and aiding in retention.
