Understanding HRM systems

HRM vs HRIS

The main difference between HRM and HRIS lies in their scope. An HRIS system stores, organises and processes employee records, usually benefiting smaller organisations the most. An HRM system builds on that by adding tools for managing people and processes across the employee lifecycle, ideal for businesses scaling past basic employee data management.

HRM vs HCM

Strategy is the key difference between HRM and HCM. HRM systems handle core HR tasks and workforce administration. HCM is more complex, tying HR to business strategy with tools for talent acquisition, succession planning and workforce development. Workday is an example of an HCM solution.

What are the core features of an HRM system?

A solid HRM setup provides payroll, scheduling and performance tools in a way that eliminates busywork, ensures organisational compliance and generates clean, usable reports to make HR run more smoothly.

Employee data management

An HRM system acts as an employee database system. Everything lives in one place, including personal information, job history, contracts and I-9s. Benefit from quick updates, instant searches and streamlined, organised records. Though it lacks the comprehensive talent management features of HCM, HRM can still track employee training, progression and performance to support development.

Payroll and benefits administration

A modern HRM system builds upon the features of a standalone payroll management system, such as salary oversight and benefits administration. Integrations push clean data to accounting without manual effort or the need for multiple platforms. Built-in HR automation software lets you sync payroll and benefits to one another to reduce errors, speed approvals and pay people accurately for every cycle.

Time and attendance tracking

An HRM system can log hours, shifts and leave requests in real time to prevent scheduling conflicts and ensure proper coverage. Many platforms allow employees to clock in from their mobile devices or laptops, while the backend tracks attendance patterns and overtime automatically. Alerts and reports keep you updated at every turn to control labour costs and stay compliant.

Employee self-service portals

Employees can manage much of their own data and requests with modern HRM systems through self-service access. Updating personal records, checking benefits and viewing pay slips are common features available on HRM platforms. These tools cut down on HR inquiries, free staff for higher-value work and give employees faster access to the information they need.

Compliance and reporting tools

Replace a disconnected HR analytics platform with a unified HRM system to produce reports on payroll, overtime, benefits and workforce demographics as soon as you need them for legal and auditing purposes. Enterprise HRM platforms also protect sensitive records with encryption and role-based access to keep organisations compliant and secure employee data.

Why invest in an HRM system?

An HRM investment can start delivering value within months of implementation. Mid-market teams often go live in about four to six months when they use a prescoped programme; large enterprises usually roll out in phases over a longer period but could quickly realise ROI after each phase.

Strategically implementing your HRM can lead to significant benefits for your entire organisation, including greater compliance and a solid infrastructure that grows with the company.

Greater efficiency and automation

Automation and mobile self-service cut out manual work for HR teams, which can boost efficiency and productivity across your organisation.

When Asda implemented Workday HCM, it unified HR for 140,000 colleagues across over 700 locations, helping to give leaders cleaner, real-time visibility and enabling time-off and training information to display correctly on employees’ phones. This gave HR room to focus on higher-value work. “After go-live, our recruitment journey became fully end-to-end,” said Loretta Smith, senior director for HR Transformation. “Now candidates move through the system seamlessly, reducing manual work and improving efficiency across the board.”

Improved data accuracy and compliance

Accurate data reduces payroll errors and lowers compliance risk. HRM systems type data directly to payroll, benefits and employee data so you can reduce manual corrections and the risk that often follows.

When Land O’Lakes moved payroll to Workday, it pushed accuracy above 99.9% and reduced off-cycle fixes and paper-based payroll while strengthening regulatory compliance.

Better employee experience and engagement

HRM systems tie in performance management software to put the right tasks, apps and updates in front of each employee. They personalise onboarding and development, which can translate into higher engagement and more consistent training outcomes for managers and teams.

After Sun Life implemented Workday into its processes, the company improved its knowledge management and ability to tailor professional development to each employee. This led to increased employee engagement and productivity across the organisation.

Scalable infrastructure for growing teams

Disconnected systems usually experience stress from headcount increases, but unified platforms are designed to handle growth. An integrated system uses one data model, so you can add people and locations without extra rework.

When Opteon used Workday to harmonise 31 acquired businesses into one operating model, it connected all data, technology and processes to align strategies across the business. “The more we can have one connected, integrated set of technology and data at our disposal, the more successful we’ll be,” said James Harkness, Opteon’s chief strategy and finance officer.

Frequently asked questions

What features should I look for in an HRM system?

HRM systems typically include must-haves for most businesses, such as payroll and benefits administration and time and attendance tracking. Compliance and reporting features and secure employee data management tools are also necessities. While not always critical, a system that offers employee self-service tools with mobile accessibility can reduce admin for HR and boost employee satisfaction.

How much does implementing an HR management system cost?

The cost of an HRM system generally depends on company size and what you need. Smaller businesses often pay a monthly fee per employee, while larger companies may pay six figures each year for more functionality. In addition to the cost of your subscription, budget for time and monetary costs related to setup, training and data migration.

Which HR software works best for remote teams?

Remote teams need systems that work anywhere, which is why many remote-focused organisations prioritise cloud-based software. Employees can connect from anywhere using their laptops or mobile devices and access their own accounts to request time off, update details or check pay from home or while travelling.

What are the benefits of automated HR processes?

Automation can make virtually everything easier for HR teams. Automated tools speed up routine tasks such as payroll and leave approvals, reducing manual labour for HR. Plus, employees get accurate pay and fast responses. Organisations can reinvest the time automated tools save into strategising to support growth.

What is the difference between HRM, HRIS and HCM?

HRM, HRIS and HCM have different scopes. HRIS is the narrowest, mostly supporting employee data storage and organisation. HRM offers HRIS features but adds processes such as payroll, scheduling and basic talent management. HCM expands both with strategy-focused features, such as learning and development and workforce planning.

What compliance features are essential in HR systems?

The best HR systems offer secure storage, audit logs and reliable reporting to comply with regulations and auditing. Systems should also automatically look for and flag issues such as expiring certifications or excessive overtime to catch problems before they escalate. If your business operates in multiple locations, look for an HR system that syncs its processes with changing labour and tax laws.