What is HRIS (Human Resource Information System)? Know Its Benefits And Functions

What is the Human Resource Information System (HRIS)?

An HRIS or Human Resource Information System provides a shared repository of employee data and statistics that help HRM (human resource management) carry out HR formalities.

HRIS is an HR system or tool that encompasses and manages employee data such as their names, address, government IDs, phone number, work permits, and dependents lists. It is a cloud-based software solution that caters to essential organizational functions like recruitment, application tracking, time tracking, performance management, and benefits administration. It can also help in enhancing your company’s employee experience as a whole.

We can consider HRIS as an employee self-service tool to track time and attendance and store necessary data. It is smart, efficient, and modern data storing software to make work easier for HR professionals. This helps an organization and its HR managers smoothen their operations, positively impacting their company culture and employee engagement efforts.

With a functional human resource information system, we can see an interaction of data, the processes performed, and the data stored in the system that becomes easily accessible and usable.

Now that you have a basic idea about HRIS, let’s know its benefits!

Benefits of HRIS

An equipped and functional human resource information system enables the HR department to spend minimal time on clerical jobs, accurately store employee data, and allows employees to contribute equally to an organization’s management information.

Implementing a standard and centralized repository for employee information eradicates the need to store paper files, which can quickly get damaged or misplaced. Let’s not forget the tedious task of finding and searching employee information through multiple drawers and pages.

Depending on the specific type of HRIS software that you use, it can procure management reports and ad hoc and help HR analytics meter out important metrics like headcount and employee turnover. On the other hand, some modern HRIS software also helps in visualization, such as automatic rendering organization charts or nine-box grids.

Another significant benefit of HRIS is that you can expect recurring tasks with automation. Hence, it justifies the need for technology in the workplace. A good HRIS software helps to reach out to broader candidate pools when it comes to new vacancies. It can speed up the onboarding process as it reduces paper costs, and all employees can access it simultaneously.

HRIS has many other benefits, and below, we have mentioned some of them for you:

• Employee self-service options that enhance employee engagement
• Open enrollment benefit
• Employee Empowerment
• Improved training
• Reduces payroll and employee information errors
• Seamless analytics and organizational data processing

HRIS Security and Privacy

An equipped HRIS helps in securing employee data by keeping all information private and confidential. While doing paper forms, or spreadsheets, personal data can easily leak out and can become accessible to all. Thus, HRIS can secure any sort of information and make it accessible to assigned and designated people only.

When you are handling sensitive information, data security is the epitome of privacy protection and safety. Countries like Germany, Australia, France, etc., have strict work councils that work towards employee data protection, and if you work in such a company, you surely don’t want to mess up. Technology can protect your data, not lock and keys.

Types of HRIS Software

Based on the customer’s interest and business requirements, whether small-sized or global corporate giants, there are a variety of HRIS systems available. Generally, the distinction is found in the range and depth of features for each business.

Most of the HRIS systems cover a vast portion that we mentioned above. Still, many systems that focus on small and medium-sized businesses tend to show less functionality in each feature than those aimed at global organizations.

Therefore, one can easily see the similarities between the HRIS market and the rest of the corporate industry. Basically, the analogy is that all corporates have a set of policies and employees, but the primary distinction lies in the qualities and facilities that makes a great company culture.

Functions of HRIS

HRIS is an HR oriented tool, and it usually helps in carrying the following tasks:

• Master data management
• Organizational management like managing designations and departments
• Employee self-services
• Manager self-services
• Benefits management
• Workflow management
• Performance management/appraisals
• Recruitment and applicant tracking
• Compensation management
• Training management
• Reporting and basic analytics

A sound human resource information system performs all the necessary human resource functions to serve maximum HR needs. Without this software, people would have continued using unsecured paper documents or spreadsheets to store data. Also, while you enter data manually, it can cause multiple errors, and when you need to refer to them after a while, it will be a task to look for them. It is time-consuming and confusing, but with a human resource information system, you can access any information without a hassle.

Usually, payroll is a part of the human resource information system, but necessarily with all companies. However, many businesses do not have payroll as part of their HRIS offering, like Oracle, Workday, which considers payroll as a separate system but integrated with HRIS.

Importance of HRIS

Human resource information systems play a crucial role in enabling compliance in any organization. For instance- if you’re working in the U.S and storing regulatory data of Equal Employment Opportunity information or in Australia, storing data for the Fair Work Ombudsman, you must maintain privacy and protection of data. You must ensure the ultimate security of the information and HRIS help you do so.

It is also important because it efficiently stores payroll data and gives fewer chances of salary discrepancies. It is time-saving, efficient, and reduces human efforts. In reality, an organization that functions without an HRIS can experience costly errors or see a downfall in its employee engagement.

Let’s justify this with an example. Suppose a company manually enters and tallies HR data, and due to a silly error, they overpay or underpay their employees or might have given them extra vacation time. In such an instance, the company's employee engagement gets negatively affected, but with a functional human resource information system, one can avoid such unwanted situations.

What is the Difference Between HRIS and HRMS?

Human Resource Information System (HRIS) and Human Resource Management System (HRMS) are nothing but two sides of the same coin. People often use these terms interchangeably and refer to both as the same, just with different terminology. Nevertheless, even if these two are similar yet, there are fundamental differences between them.

HRMS focuses on all the HR functions, i.e., from an employee’s recruitment-to-retirement. This incorporates employee tracking and allows workers to perform tasks and analyze critical data. It also allows employees to follow new trends, create and innovate and manage reports efficiently. HRMS holds detailed information about payrolls, attendance, appraisal, rosters, etc. As a whole, it helps the HR department to manage workflows smoothly and seamlessly.

When we talk about HRIS, the scope is limited compared to HRMS in terms of employee information. It holds static data like employee permanent and temporary address, educational qualification, phone number, bank details, tax files, etc. It is beneficial for regular tracking and administration management. HRIS is crucial in recruitment management because with automation scrutinizing resumes, candidates become way faster and simpler.

Related Article: 15 Best HRMS Software in 2024

Conclusion

We just answered to what is HRIS or Human Resource Information System along with its benefits and functions.

If you also got your answers related to HRIS from this article, do let us know!

This article is written by Gautam Gayan. He works as a Content Marketer at Vantage Circle. Apart from being a passionate content creator for HR services and employee engagement, Gautam is a theatre enthusiast, an avid reader and an aspiring poet. For any related queries, contact editor@vantagecircle.com