Definition

HRIS

Contributor(s): Luke Marson

A human resource information system (HRIS), sometimes referred to as human resources management system (HRMS), is software that provides a centralized repository of employee master data that the human resource management (HRM) group needs for completing core human resource (HR) processes.

An HRIS stores, processes and manages employee data, such as names, addresses, national IDs or Social Security numbers, visa or work permit information, and information about dependents. It typically also provides functionality such as recruiting, applicant tracking, time and attendance management, performance appraisals and benefits administration. It may also feature employee self-service functions, and perhaps even accounting functions.

In some ways, an HRIS can be considered a smart database of employee information: The interaction of the data, the processes that can be performed and the reporting capabilities make the data stored in the system more accessible and usable.

HRIS benefits

An HRIS enables the HR department to spend less time on clerical tasks, helps ensure the accuracy of employee data and can enable employees to take a greater role in the management of their information.

Having a centralized repository for employee data removes the need to store paper files, which can be easily damaged, and the need to search through large paper-based employee files to find information. Depending on the type of HRIS software, it should generate various reports, provide ad hoc reporting capabilities and may offer analytics on important metrics such as headcount and turnover. Modern HRIS software also offers visualization capabilities for employee data, such as automatically rendered organizational charts or nine-box grids.

When an HRIS has employee or manager self-service, the process for making employee master data or organizational changes becomes more efficient and uses less time than with paper-based requests. Approval workflows enable changes to be approved or rejected, with the necessary individuals automatically notified. An HRIS might also offer mobile capabilities that extend self-service and provide additional flexibility for remote workers.

HRIS security and privacy

An HRIS also helps secure employee data and keep information private. When using paper forms or spreadsheets, information can easily be accessed by people who may not have the authority to access it. An HRIS can secure information so that it can only be accessed by the individuals that need to have access to it.

Data security and privacy are important factors when handling sensitive personal information, especially in countries like Germany or France, where works councils have a strong role in protecting employee data. With the exception of lock and key, protecting paper records can be extremely difficult.

Types of HRIS software

A variety of HRIS systems are available and aimed at different types of customers, ranging from small and medium-sized businesses (SMBs) all the way up to large enterprises. Usually, the difference is in the range and depth of features for each process area.

While most HRIS systems cover a large portion of the processes described above, many HRIS systems aimed at small to medium-sized enterprises (SMEs) have less depth of functionality in each feature than those aimed at large enterprises.

In this way, the HRIS market is similar to the automobile market. All automobiles will get a driver from A to B, but major differences exist in the quality and amenities offered.

HRIS functions

An HRIS usually features modules to handle the following tasks:

  • Master data management
  • Organizational management, such as positions and departments
  • Employee and manager self-services
  • Absence and leave management
  • Benefits administration
  • Workflows
  • Performance appraisals
  • Recruiting and applicant tracking
  • Compensation management
  • Training tracking (as opposed to a learning management system [LMS]) and organizational development
  • Reporting and basic analytics

An HRIS provides a comprehensive set of HRM functionalities to serve most human resource needs. Without this, unsecured or paper-based documents or spreadsheets are required to store data. Manual data entry can cause errors, and manual cross-checking of documents and spreadsheets can be time-consuming and sometimes confusing, especially with a lack of standardization in how data is captured and stored.

Even when a specific system is purchased to cover a process -- such as benefits administration -- it may mean manually entering employee data changes to keep the system up to date. If multiple systems are used, data re-entry may be required for each system, or users may need to export data from one system, change it and then import it into another system.

In some instances, payroll can be part of an HRIS. However, many vendors either don't have payroll as part of their HRIS offering, or -- as with Oracle, Workday and SuccessFactors -- they sell payroll as a separate system that integrates with their HRIS.

Importance of HRIS

An HRIS can play a critical role in enabling compliance (for example, to store regulatory data for a country, such as U.S. equal employment opportunity information or U.K. Working Time opt-out) and can offer a means of gaining insight into the workforce. Both are important and, in some industries, are interwoven.

Functions of an HRIS

In addition, downstream integration of systems that require employee data, such as payroll or LMS, and the immense time savings from having integrated applications means an HRIS can serve a critical role, since data entry in multiple systems -- a reality for organizations without an HRIS -- can lead to costly errors or reduced employee engagement.

As one example, suppose a company that manually enters HR data mistakenly overpays employees or gives out too much vacation time. That company will find employee engagement negatively affected if the error is reversed, a situation that could be avoided with an HRIS.

The difference between an HRIS and an HRMS

Exact definitions for HRIS and human resource management system (HRMS) vary, but many experts take the view that an HRMS offers greater functionality by adding talent management and human capital management (HCM) options.

The talent management functions often include:

  • Onboarding
  • Succession planning
  • Career development planning
  • Learning management

The HCM functions often include:

  • Labor tracking, typically a system that tracks all necessary work and distributes that work to workers, often in hourly roles, such as in manufacturing plants
  • Time entry and evaluation
  • Workforce scheduling and tracking
This was last updated in July 2017

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Considering purchasing HR software? Access our resources for an expert review of different types of human resource management software and find advice for determining your company's HR software needs and choosing the right tool for your organization.

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