The Ultimate Guide To HRM / HRIS / HCM Implementations
A vendor-independent (unbiased*) and practical guide for picking the right solution and getting through your implementation with the least amount of headache.
HRM, HRIS, HCM Systems: What is the difference?
HRIS (Human Resource Information System)
HRIS systems include data management of various HR processes such as benefits, workforce management, payroll, and core HR. It is designed to manage people, policies and procedures.
HCM (HUMAN CAPITAL MANAGEMENT)
These systems have the functionality of HRIS plus talent management (TM). They cover a wider range of functions across the entire employee lifecycle.
HRMS (HUMAN RESOURCE MANAGEMENT SYSTEM)
These systems typically include employee data management to payroll, recruitment, benefits, training, talent management, employee engagement, and employee attendance.
Why do you want to implement an HR system?
Improve data security & Ensure compliance
Recently launched data privacy rules such as the GDPR require companies to implement professional electronic data management. Excel-based solutions for managing employee data or time tracking aren’t an option anymore. Sensitive data such as employee information — address data, salary, bonuses, social security numbers, allergy data, medical records — confidential data like that must be stored securely, access may only be given at the necessary level and data usage and maintenance must be auditable. Are you sufficiently protecting your employee records? Are you tracking headcount properly? So companies want their employee data to be secured in a cloud solution.
So in an HR system, you can segregate the permission level. Let’s say if you’re an employee, this is the only stuff that you can view a system. If you’re a manager, you can view your direct reports information but not but not people under specific persons. So you assign specific roles in security roles to your employees. So, ensuring that only HR, Finance or maybe the CEO can access certain information, you can decide on that.
Reduce errors and improve data quality
If you’re currently using spreadsheets to manage employee or payroll information, you know how vulnurable the process is. No error or plausibility checking is done, and it’s so easy to screw up stored information with the click of a mouse button. With an HR system, there will be less reasons to worry: because you set the permissions a user can have, and all transactions like payroll are automatically checked by the system and you can do a trial run, you can set up approval workflows where any changes are double-checked by the respective person — a supervisor, an employee etc. You can’t do any of that with a spreadsheet. So it’s gonna be a lot easier with an HR application and you’ll have more time for the important things.
Moving away from manual and Excel-based solutions for employee data management and switching to an HRIS/HRM application has the benefit that you simplify or even automate some of the common processes. The best example are employee self-services: An employee got married and needs to change her last name? An employee moved across town and wants to provide their new address? An employee just completed a Project Management Course and would like to add that skill to their employee record?
With an HR systems in place, employees have logins on their own. So it’s gonna be up to them to update their address, credentials, nicknames, pronouns, favorite color and whatnot. So having that compared to the manual process of a spreadsheet, an HR system is really beneficial. And it’s no longer a deal for HR admins or HR personnel to keep an eye on every change. Employees can update and track their personal data on their own.
Or take a more complex topic like holiday accruals: Like 1.5 a month so you can set that in the system, and it’s hard to do that on a piece of paper, in a manual process. So you want to automate that. And sometimes accruals differ per department, per level of the employee and, and per country. So if you’re managing multiple departments and multiple regions you want to have that holiday accruals tracking done automatically.
Gain insights & always know your numbers
Is your company really as great as you thought? How happy are employees with the company culture? Why do employees leave to a competitor? What is the company’s attrition rate? Is the talent hired actually utilized or do you waste a lot of money on hiring and see employees leaving again after 2 weeks? With an HR system, you can roll out surveys and gain insights on the wellbeing and satisfaction of your team. From there, the surveys give you useful and specific insights on issues causing dissatisfaction, and you can improve the organization step by step to become a truly great place to work. Especially useful in times where it’s so hard to attract great talent.
This is an overview of the most common vendors of HR systems, grouped by target audience. This is not a complete list and the order does not imply any kind of qualitative ranking.
This is not a complete list.
Tips for your HRM/HRIS implementation
1. Have a dedicated project team. There's a lot of work to be done.
In an HR implementation, it’s good to have a dedicated team that can, you know, can roll out this they, they can, they can assess the data and how it’s gonna fit in the system, ensure HR processes integrate well with the other processes and systems. They need to know what the requirements for the system are. They need to assess like how many, how many customizations are gonna be in the system. At the minimum, the project team should consist of an HR, a Finance and an IT expert.
2. Get involved in the requirements discussion and be meticulous about the details
When you purchase an HRM system, most likely your company requirements don’t automatically align with the functionalities that the system can offer. The system has to be configured based on your needs. This requires a lot of meetings and a detailed discussion of your company’s policies, processes and data management: What employee information does your company track? What custom fields are required? How should security roles be segregated so that people can only access the data they are supposed to see? It may be painful to go over all these details, but this is what the implementer needs to know to set up your HRM system properly.
Ideally, you should discuss your specific requirements already before signing the contract! You want to be absolutely sure the vendor is actually capable of meeting your needs. In that context, it’s worth mentioning that the statement “Sure, our solution can do that” coming from a sales rep is worth nothing. You have to ask specific questions about features needed and get a Solution Engineer onboard to get reliable feedback. If you are not meticulous about the specific features of your future HRM solution, you’ll end up in an unfortunate situation like the one one of my readers faced:
The company was in the process of evaluating suitable HRM solutions. They had a specific request for an employee report to be generated automatically each week based on certain criteria and sent to the respetive managers every Monday. The request was discussed in the sales workshops, and the HRM software vendor confirmed they were able to accomodate it. A deal was signed, and the implementation was started. Fast forward 4 months, the HR system administrator logged onto the HRM system to set up the automatic email report. To his surprise, he discovered that there was not way to enable the automatic reporting. Filter criteria could be set the report could only be triggered manually and not automatically (as was expected).
The HRM/HRIS Implementation Playbook
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