Human resources (HR) play pivotal roles in a business, no matter how small or big it is and how much profit it makes. For this reason, small business owners should follow the lead and consider investing in human resource management software.
While most small businesses aim to keep their expenses low, investing in such a software solution reduces business costs in the long-term. The cloud-based system safely stores essential documents and ensures other HR-related functions are fulfilled, thus keeping the business out of trouble.
If you own a budding start-up and think about whether HR software is good for your business, then carry on reading. We listed down how such technology can benefit you and your business in several ways.
What Is Human Resource Management Software?
As its name suggests, human resource management software (HRMS) streamlines a host of HR functions—recruitment to training and development, employee data management, performance reviews, absence and leave management, and more—in one tech solution.
This tool typically covers every element of a human resource information system or HRIS. It executes critical HR activities, such as payroll and benefits administration.
How Small Businesses Can Benefit from This HR Software Solution?
1. Save Time & Resources
With an HR management system, business owners can save time and resources from the routine workflow processes, including onboarding, records and employee benefits management, tax compliance, and more.
The software allows users to perform these repetitive manual tasks with great precision, not to mention that it also saves them time, energy, and resources.
For instance, applicants submit their resumes to the HR department, and the recruitment staff prints out the documents and give them to the hiring managers. Then, the best candidates will be forwarded to the department heads for one or more interviews.
If only HR software is in place, then the recruitment process would not consume a lot of time and resources on both the employer and applicant side.
HRMS publishes an application form on a business website, filters the applications according to the candidate’s credentials, and creates individual reports based on the candidate’s status (i.e. shortlisted, rejected, offered a job, etc.), ensuring hassle-free hiring and candidate selection.
2. Single & Secured Data Storage
Since human resource management software works under the cloud, it processes and safely stores data electronically. This functionality helps small business owners hit not only two birds but three or more with one stone.
With this HR tech solution, businesses can store their important files and documents without physical storage. They can get rid of their filing cabinets for good because HRMS provides unlimited storage space.
Employees can also request a change in their address, make other updates, and submit time-off requests through the self-service employee portal. The employee portal gives employees their own space but also helps to manage administrative tasks.
3. Boost Productivity & Improve Accuracy
The human resource unit is critical to any company. It keeps businesses legally compliant, assists organizations reach their goals and protects their most important resource (people), among other benefits.
Given the big responsibilities of HR professionals, their work productivity could affect the company’s bottom line. If they are not doing their jobs effectively and accurately, chances are several HR tasks are falling through the cracks.
Say, for example, a small marketing firm with less than 50 employees is not using HRMS yet. Its HR staff still manually prepare payroll but is also wired to the repetitive admin tasks, such as updating employee records and going through the timesheets.
If HR software is in place, HR payroll specialists can focus on more value-added activities and complete work with high levels of accuracy. The technology is typically built with automation tools that allow users to automate complex payroll processes.
The HR system deals with payroll preparation and calculates all unique points, such as overtime hours, salary increases, benefits, absences, automatically. This function not only guarantees faster processing of payroll but also reduces errors in invoices and paychecks.
4. Review & Monitor Employee’s Performance
Performance appraisal motivates employees and boosts their morale. Companies of all sizes should conduct such a program to assess training needs, build strong bonds, and set new goals.
Through human resource management software, HR departments can keep track of every employee’s performance. The tool helps companies maximize efficiency and provide more accurate feedback for their employees.
Most HRMS solutions can be configured and tailored to the needs of a business, allowing managers to do the following tasks:
• Assign individual goals to employees
• Check performance against the goals
• Plan and track training sessions
• Write notes and leave feedback
5. Ensure Compliance & Drive Business Growth
Compliance is critical in human resources management. If a company is not in compliance with the employment laws and other Federal or State regulations, it may face significant fines and worse lose its credibility.
This is why small businesses should also strive in meeting HR compliance the way large corporations avoid HR complexities. When it comes to ensuring compliance, HRMS also comes in handy. Such a software solution covers four important features needed for compliance, including:
• Payroll – A human resource management system helps with making accurate and legislated deductions and submitting mandated reports.
• Documentation – It is crucial to keep employee records and files updated. Thankfully, HRMS makes it easy for HR professionals to update documents across all systems.
• Recruitment – Federal state and local employment laws prohibit discrimination in recruitment. Up-to-date HRMS comes with a wide variety of automated and customizable templates that have been approved as non-discriminatory.
• Auto-updating – Laws and trends change constantly. The good thing is that most HR software solutions are scalable; they can evolve together with the organization’s growth.
The Bottom Line
The functions of the human resources department are all-encompassing. Regardless of how small a company is, it still performs a series of HR tasks that are essential for business growth.
For that reason, small business owners should consider investing in human resource management software. Doing so not only simplifies repetitive and complicated HR duties but also helps drive better business outcomes.