Master the fundamentals of HR software to address the unique needs of your business
Human Resources Information System (HRIS), Human Resources Management System (HRMS), Human Capital Management (HCM) software, HR software, human resources system... All these terms and acronyms pertain to a single area: the automation of core Human Resource management processes. However, even though these HR solutions address the same function, their methods and area of focus can vary significantly.
Some solutions automate only the HR administrative aspects of HR monitoring. Others extend beyond daily task management to become strategic tools for decision-making and team performance management.
The functional scope of HR software
HR tools address four key areas: compensation, administration, personnel management and talent management. While some solutions focus solely on one of these areas, others offer broader functional coverage and can manage all four simultaneously.
HR administrative monitoring software solutions
Known as "Core HR", this type of HR software meets the needs of all businesses. It helps organize employee HR files and facilitates management by automating administrative tasks related to the centralization and updating of employee data (such as postal address, social security number, position within the company, contract start date, and so on).
Additionally, it may include an HR information access portal, that allows employees to update their own data. For companies with growing workforces, onboarding solutions automate the administrative tasks required to welcome new employees.
HR software for talent management
These HR solutions target companies that have reached a certain size, are growing and face challenges related to performance, recruitment and talent retention. They provide insights into the skills available within the organization, help identify high performers and facilitate corrective actions such as recruiting specific profiles or developing training plans.
HR review management solutions fall under this category, simplifying the preparation of annual reviews and tracking objectives, enabling HR departments to measure team performance and identify future leaders.
Personnel management solutions
These solutions go beyond basic administrative monitoring. They manage team schedules, track time and activities, and handle leave requests.
Leave and absence management is often the first process companies digitize when they reach a critical size, making manual data management impractical. Automated solutions can also help meet legal obligations, such as a time and activity management systems.
Technical differences between HR management software
Beyond the functional differences, HR software is divided into two main types: HR SaaS solutions and software known as on-premises (i.e. installed on the company's servers). The distinctions lie in how they are sold, maintained and used.
HR SaaS
A SaaS HR solution is an online application accessible via a web browser. Billing occurs as a monthly subscription and includes updates and bug fixes. Both the application and the data it contains are hosted on external servers, meaning companies cannot customize the software. Instead, businesses must adapt their practices to fit the tool.
Software on-premises
Licence mode software, also known as "on-premise", requires installation on the company's physical servers making the company the owner. This necessitates having an IT department responsible for the maintenance of the software. It creates a dependency on the service provider who managed the rollout.
In addition to the purchase price of the licenses, companies incur extra costs for software maintenance such as updates, configuration adjustments, and licence renewals.