What Is HR Software and What Are Its Benefits?

by Anna Khrupa on Jul 28, 2022

The human resource department often has much admin-heavy work, which is essential for the entire company and not limited to HR processes. Its activities touch upon such aspects as hiring, HR policy development, and staff interaction and collaboration. Businesses can significantly improve the level of organization and increase productivity by digitizing and automating the HR department’s work.

Nowadays, it becomes possible with software solutions. Why HR software is important and how it works, we’ll learn further on.

What is HR Management Software?

Like any other software solution, HR software is a tool for a human resource specialist or a team that helps to reduce admin activity and store employee data in an easy-to-access place, usually a cloud. It provides a centralized location for staff records, corporate policies, and contracts, making it easier for both managers and employees to access valuable information. 

It makes HR software beneficial for multi-site located companies, traveling workers, or remote specialists. Mobile versions allow checking data even when an HR is out in the field while employees can log in and input their details, correct timesheets, check invoices, find resources, submit time-off requests, and much more.

Various solutions, often referred to as HRMS (Human Resources Management System) or HRIS (Human Resources Information System), are available on the market. 

Let’s check, what is an HR software system? It’s a suite of software apps utilized to manage the human resources of the company throughout the employee lifecycle and all the processes that relate to these, with all the labor regulations and tax laws taken into consideration. Executives can also use the system to generate data concerning workforce trends and their business implications.

What Does HR Software Do?

The key function of the HR software is managing people, data, and processes throughout the hire-to-retire cycle.

Such solutions work by optimizing, rationalizing, automating, and speeding up the corporate end-to-end HR processes, like: 

  • Hiring,
  • Onboarding,
  • Scheduling,
  • Creating workflows and tracking approvals,
  • Employee engagement monitoring, 
  • Managing the employee performance and goal tracking,
  • Securely storing and organizing employee data,
  • Document management,
  • Federal and state health, safety, and labor laws compliance management,
  • Compensation and succession planning,
  • Payroll,
  • Offboarding,
  • Reporting and analytics.

It results in reduced errors, better compliance, and increased productivity.

The software used can be variable: simple apps can be as effective for smaller companies as a sophisticated suite of technologies for big corporations. Such advanced software products can include the entire employee experience, from worker onboarding through employee document management to benefits administration.

How Does HR Software Work?

There are pure-play and all-in-one HR software solutions. The first ones are, as a rule, super-narrowly focused, and deal with just one aspect — payroll, for instance. Such software is efficient if you need to transform only one HR element but may cause you a headache when integrated with other solutions or modules.

So, let’s check how all-in-one solutions work.

Such solutions handle the entire HR function from one place and help medium-to-large businesses grow and centralize multiple complicated processes. 

This software forms a single system of records, allowing businesses to keep control over large sets of employee data and maintain compliance with current regulations in various spheres. 

When new hires become employees, they proceed from the onboarding to employee engagement modules. HR software allows the human resource department and other employees to share corporate policies and company best practices with everyone. Thus, all information is stored in one place and can be accessed from any device by those who need it.

Being primarily cloud-based, HR software simplifies the work of those who work flexible hours or remotely. They receive reminders with the same frequency as on-site workers. 

HR software allows to decrease the training time for the company newcomers, ensures their better adoption, and lowers overall HR management costs. At the same time, HR software makes HR-related reporting and analysis, because all the data is stored in one single place.

Why Use HR Software?

Good HR software inspires HRs to add more value and achieve better business outcomes. It facilitates the continuous enhancement of a modern workplace and the highest caliber talent attraction. 

With modern HR software, managers can help employees develop new skills and progress in their careers faster. They can also track their workers’ performance, schedule them for work and make notes of all the workplace issues that arise. 

HR tools are valuable to financial specialists for simple reporting on tax compliance, payroll, and benefits expenditures, as well as headcount analysis, to project future costs.

So, with HR solutions, financial and document errors are reduced, legal compliance risks go down, and corporate policies are more consistently enforced. More than that, reduced paperwork and streamlined processes release certain time for both managers and employees, allowing them to become more strategic and deeper engaged in their work. 

To cut a long story short, the key benefits of using HR software are the following. 

  1. Increased efficiency and productivity
  2. Enhanced employee experience/morale
  3. Faster employee development/longer retention
  4. Better regulatory compliance
  5. Reduced errors
  6. Cost savings
  7. Advanced attendance monitoring
  8. Simplified benefits administration
  9. Higher data security
  10. Improved access to metrics for analysis
  11. Improved decision-making

Final Thoughts 

As you can see from the above, the benefits of human resources solutions go far beyond an HR department, simple processes automation, and cost reduction. They help streamline the workflow, improve employee engagement, increase overall business performance, facilitate wringing more financial insights out of human resource data, and support processes for the benefit of the whole company’s wellbeing. So, by investing in your corporate HR software, you invest in your business development and welfare.


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