Development of HRIS: Streamlining Human Resource Management

The development of HRIS (human resource information system) is crucial for organizations looking to streamline their people processes. It has a centralized employee database, user interfaces with dashboards and mobile apps, and integrations for automated workflows. This article explores the evolution of HRIS, the key features it offers, its benefits, challenges faced in its implementation, and future trends shaping the development of HRIS. 

A human resource information system (HRIS) refers to a digital platform with three components – a centralized employee database, user interfaces with dashboards and mobile apps, and integrations that power automated workflows. The development of HRIS is the first step all organizations must take to grow their workforce and scale their business in a compliant and sustainable manner.  

Evolution and Development of HRIS 

The history and evolution of HRIS can be traced back to the era of manual record-keeping in the early days of human resource management. Before the advent of technology, HR professionals had to maintain employee records and data manually using paper-based systems. This process was time-consuming and prone to errors. 

In the 1950s and 1960s, the first automated HRIS systems were introduced, primarily focusing on payroll management. These systems replaced the manual calculation of employee wages and improved accuracy and efficiency in payroll processing. 

As technology advanced, HRIS systems began to incorporate additional functionalities beyond payroll. In the 1980s, HRIS systems started offering features like recruiting, training, performance management, and benefits administration. These systems aimed to attract, retain, and reward employees effectively. 

With the rise of the internet and cloud computing, HRIS systems underwent a significant transformation. Cloud-based HRIS solutions emerged, enabling organizations to access their HR data from anywhere, at any time. This eliminated the need for on-premises infrastructure and provided scalability and flexibility. 

Today, HRIS systems have evolved further to include integrations with other business applications. These integrations allow seamless data flow between different systems, such as HRIS and payroll or HRIS and applicant tracking systems. These integrations streamline HR processes and eliminate the need for manual data entry and reconciliation. 

Mobile apps have also become an integral part of modern HRIS systems. Employees can access their personal information, apply for leaves, view pay slips, and participate in training programs using their smartphones or tablets.  

These advancements have revolutionized the way HR departments manage employee data and streamline HR processes, leading to increased efficiency and productivity in organizations. 

Key Features of HRIS 

The development of HRIS (human resource information system) must focus on three core functions: data management, payroll and benefits, and recruitment. 

1. Employee data management

HRIS systems provide a centralized database where HR professionals can securely store and organize employee records, such as personal information, employment history, training records, and performance evaluations. 

With HRIS, searching and retrieving employee data becomes fast and efficient, eliminating the need for manual file searches. Additionally, HRIS systems enable the tracking of employee performance and appraisals. They offer features like goal setting, performance management, and appraisal workflows, simplifying the process of evaluating employee performance and providing timely feedback. 

This functionality promotes transparency, consistency, and uniformity in performance management, ultimately contributing to the development and growth of your employees. 

2. Payroll and benefits administration

The development of HRIS plays a crucial role in streamlining payroll and benefits administration. First, it automates payroll calculations, relieving HR professionals from manual, time-consuming tasks. By integrating with attendance and timesheet systems, HRIS accurately calculates employee salaries, overtime, bonuses, and deductions. 

Moreover, it ensures compliance with tax regulations by automatically calculating tax deductions based on employee data, such as dependents and filing status. This minimizes errors and reduces the risk of non-compliance. 

Second, HRIS simplifies the management of employee benefits. It centralizes data regarding benefit plans, options, and eligibility criteria, making it easier for HR to communicate and administer benefits effectively. Employees can review their benefits, make changes during open enrollment periods, and access relevant information using HRIS self-service whenever needed. 

HRIS also enhances leave management by providing a central platform for employees to request time off and for HR to process and approve those requests. It automatically enforces company policies regarding leaves, guaranteeing transparency, ease-of-use, and fast resolution.  

3. Recruitment and onboarding processes

This feature of HRIS enhances the recruitment and onboarding processes. By integrating with an applicant tracking system (ATS) or having an embedded ATS within it, it provides a seamless experience for hiring managers and candidates alike. The integration allows for the smooth transition of applicant data from the initial application stage to hiring and onboarding. 

HRIS offers a singular database that stores candidate information, facilitating easy access, retrieval, and analysis of resumes, qualifications, and interview feedback. Moreover, it enables automatic notifications and updates, keeping all stakeholders informed throughout the recruitment journey. 

During onboarding, HRIS acts as a comprehensive platform, automating and simplifying several tasks. For instance, it securely stores necessary documents such as employment contracts, tax forms, and company policies. Through customized forms and checklists, HRIS also streamlines the collection and verification of new hire data.  

Learn More: Everything You Need to Know about a Global HRIS  

Benefits of HRIS Development 

Given the expanse and complexity of these features, the question then arises, why invest in the development of HRIS in the first place? Well, companies either build or purchase (i.e., subscribe to) human resource information systems for three reasons: 

1. Time and cost savings

HRIS platforms unlock time and cost savings for companies by reducing manual paperwork and administrative tasks. By automating various HR processes such as employee onboarding, attendance tracking, leave management, and payroll processing, an HRIS eliminates the need for manual data entry. It also reduces costs arising from errors. 

With an HRIS in place, employees can input and access their information digitally.. This not only saves time but also reduces the risk of lost or misplaced documents. 

Thanks to self-service, HR professionals can focus less on routine administrative tasks and more on value-added activities like talent management, employee engagement, and strategic planning. 

Through data centralization, an HRIS also facilitates analytics and reporting capabilities. HR professionals can easily generate reports on employee data, such as headcount, turnover rates, and training needs. This data-driven approach allows companies to make informed decisions based on real-time insights, leading to greater profitability and more savings. 

Ultimately, the development of HRIS streamlines the entire HR workflow, saving valuable time and resources that can be redirected toward more strategic initiatives. 

2. Improved data accuracy and security

By centralizing all HR-related information in one system, the HRIS eliminates the need for manual data entry or multiple data sources. 

The system ensures that data is entered consistently and accurately across various HR processes, such as employee onboarding, performance management, and payroll. 

Furthermore, an HRIS enhances data privacy and compliance by implementing robust security measures. 

Organizational data stored in an HRIS system is typically encrypted at rest and in transit. Additionally, you can set access controls and user permissions within the HRIS, limiting access to only authorized personnel and protecting against data breaches. 

In terms of data privacy and compliance, an HRIS allows companies to conform with relevant regulations, such as GDPR (General Data Protection Regulation) and CCPA (California Consumer Privacy Act). The system can track and manage consent for data processing and action mechanisms for data subject rights. Companies can easily generate reports and audits to demonstrate compliance. 

Modern HRIS systems integrate with firewalls, intrusion detection systems, and vulnerability assessments, to identify and mitigate potential threats. Regular updates and patches can be applied to ensure the HRIS remains resistant to emerging cyber risks.  

3. Enhanced decision-making

HRIS powers smarter decisions by providing access to real-time HR analytics (via dashboards) along with historical reports. 

With an HRIS, you can generate comprehensive reports on various aspects of the workforce, such as employee demographics, performance, training, and attendance. This wealth of data enables a deeper understanding of the workforce and facilitates data-based decision-making.  

By using real-time HR analytics, HRIS allows organizations to identify trends, patterns, and potential issues within their workforce. For example, you can identify high-performing employees who may be suitable for leadership roles or detect skills gaps that need to be addressed through targeted training programs. 

Through this data-driven approach, organizations can make more informed decisions regarding talent management and succession planning, ensuring that the right people are in the right positions. 

You can also leverage insights from the HRIS to anticipate future workforce needs and develop effective workforce planning strategies. By analyzing historical data, you can forecast fluctuations in workforce demand, plan for retirements, identify skill shortages, and proactively recruit and retain top talent. 

Learn More: The Need for HRIS: A Comprehensive Guide To Transforming Employee Experience for HR Leaders   

Challenges in HRIS Development 

When developing a human resource information system for your company, you’re likely to face a few speed bumps. Knowing these challenges can help you stay ahead of and address common HRIS development issues: 

1. Implementation and integration issues

A common challenge is data migration, as transferring large amounts of historical data from legacy systems to the new HRIS can be complex. You may encounter compatibility issues between different systems, formats, or data structures, leading to data quality and integrity concerns. 

To address this, work closely with your IT team and the HRIS provider to develop a data migration plan and conduct thorough testing before going live. 

System compatibility can also pose challenges during HRIS integration. Connecting the HRIS with your existing systems like payroll, time-tracking, or performance management systems may require technical expertise and external support. 

Training and user adoption hurdles are another common challenge. Introducing an HRIS may alter established workflows and require employees to learn new processes. This can lead to change resistance or a reluctance to adopt the new system. 

To overcome this, develop a comprehensive training plan that includes hands-on sessions, user manuals, and ongoing support. Involving employees in the decision-making process and clearly communicating the benefits of the HRIS can also foster user adoption. 

2. Data privacy and security concerns

When companies start using HRIS, they may face data privacy and security concerns. Ensuring compliance with data protection regulations can be challenging due to the complexity of new laws and varying legal requirements in different jurisdictions. 

Safeguarding sensitive employee information has to be a priority because it not only protects individuals' privacy rights but also maintains trust and confidence within the workforce. 

Remember that employee data often includes personally identifiable information (PII) such as social security numbers, addresses, and bank details, which can be targeted by cybercriminals. By prioritizing data privacy and security, you demonstrate your commitment to your employees, promoting a culture of trust and security within your organization. 

To address these concerns, implement robust security measures such as HRIS data encryption, access controls, and regular data backups. Monitor systems to detect and prevent any unauthorized access or activities. Partner with legal experts (or a technology vendor who does) to conduct risk assessments and audits. This will help identify any discrepancies and ensure compliance with data protection regulations. 

Additionally, training employees on data privacy best practices and establishing clear policies and procedures for handling and safeguarding sensitive data is crucial. 

Learn More: HRIS vs HRMS vs HCM: What's the Difference?  

Future Trends in HRIS Development 

Despite being a mature technology, companies are not slowing down when it comes to the development of HRIS. In fact, two notable trends are revolutionizing how human resource information systems work: 

1. Artificial Intelligence (AI) integration

Artificial intelligence (AI) is revolutionizing HR information systems (HRIS), improving efficiency and transforming how HR teams work. 

With AI, you have the power to automate routine tasks. For example, AI-powered chatbots and virtual assistants can handle employee queries, streamline recruitment processes, and automate onboarding and offboarding processes. Optical character recognition (OCR) technology integrated into HRIS digitizes and extracts data from physical documents like resumes and employee records. 

Along with automation, AI brings the potential of predictive analytics to talent management, allowing you to make data-driven decisions. By analyzing large volumes of employee data, AI algorithms identify patterns and provide insights into future outcomes. With this information, you can better understand talent acquisition, retention, and development needs. 

Predictive analytics also helps predict attrition risks and facilitates the design of effective training programs. Thanks to AI, analytics insights are easy for anyone to understand and implement, even without knowledge of data science. 

Generative AI is another exciting area – a subset of AI – that enhances HRIS functionality. With generative AI, you can effortlessly create content such as job descriptions, performance evaluations, and personalized development plans. 

2. Employee self-service portals

Employee self-service portals are a critical  HRIS trend for the future as they empower individuals with easy access to their HR information. This fosters a sense of ownership and control over HR data, particularly with advancements in mobile apps. 

Moreover, self-service portals facilitate the self-management of benefits and leave requests. By logging into the portal, employees can view available benefits, enroll in or make changes to plans, and access relevant policy documents. They can also submit leave requests, track their status, and view the remaining leave balance. This reduces the administrative burden on HR teams to a huge extent.  

The importance of this HRIS trend lies in its ability to enhance employee engagement and satisfaction, especially in a remote and hybrid working world. By providing easy access to HR information on any device in any location and allowing employees to self-manage tasks, they gain more control over their work-life balance. 

Moreover, self-service portals promote transparency and accuracy, great for both organizational culture and HR compliance. With direct access to all necessary information, employees can verify their accuracy and rectify any discrepancies promptly.  

Learn More: The Power of a Complete HR Software Singapore  

Conclusion 

The development of HRIS is essential for any organization, big or small. It allows you to centrally store employee data and use it for various purposes, from running payroll to demonstrating your compliance with labor laws.  

Fortunately, advancements in HRIS technologies, like the cloud, make it much easier to find and implement a human resource information system that’s perfectly suited to your company. HRIS development no longer has to be a costly and complex affair that you cannot manage without extensive technical resources. This makes it possible to gain from powerful benefits like thousands of hours in effort savings and happier employees.  

See what HRIS can do for you, with a Darwinbox demo!