Personnel management software

What is HR management software?

HR management software is a computer application – usually web-based today – that is used to digitally map and support work processes and information in HR work or the HR department. Depending on the software, more or fewer tasks can be effectively planned, executed and documented by HR managers. It therefore serves as a management system that meets the strategic and operational requirements of a company.

At its core, software helps to record, process, document and archive complex processes and information from various data sources and from multiple parties in a structured manner. HR software solves various challenges for the responsible HR departments.

The scope of services varies depending on the HR software. In principle, the description covers all processes from applicant management through to payroll accounting and the departure of employees. Ideally, all processes of an employee life cycle are mapped within one software.

Are HR software and personnel management software the same thing?

Yes, HR software and personnel management software describe one and the same thing. HR software stands for human resource software, which translated from English means personnel resource software. Since people are translated as “resources” in the German translation and this has a pejorative connotation, the term is becoming less and less important in Germany. After all, people are not resources, they are human beings. This is why “human resource departments” are once again becoming “personnel departments”.

Why is HR management software so important?

There are many reasons why HR management software is important or even indispensable for companies. One of the main reasons is often the necessary working time and associated costs for HR managers.

HR departments usually spend a large part of their working time on administrative activities. These include collecting and querying personnel data, checking personnel details, creating and managing contracts, forwarding data to the tax office, for example, calculating wages and salaries, keeping track of documents, vacation and absence management and many other activities. They enable the formal work situation of an employee in a company. There is often a legal basis that requires these activities, such as the Working Hours Act, Vacation Act, Temporary Employment Act, Dismissal Protection Act and many more.

HR departments need a lot of time to compile and evaluate all this information due to the many different lists, contact persons and parties involved. This is precisely where HR management software can help, by digitizing, bundling and documenting these processes and linking all parties involved on a single platform.

Furthermore, such a tool also helps to comply with the legal requirements in the first place. From a certain number of employees, it is hardly possible to comply with all regulations, e.g. compliance with the minimum wage, exceeding the maximum permitted working hours, compliance with rest periods and much more. Data protection also often suffers enormously when personnel data is distributed across many different and unprotected systems.

What are the advantages of HR management software?

Basically, the more employees a company has, the greater the positive effects of introducing HR management software will be. This is because more and more people benefit from the advantages and the savings per employee increase.

Saving working time and efficiency

The digitalization, automation and centralization of personnel data, from applicant management to personnel files, resource planning, time recording and payroll, can eliminate an enormous number of proprietary systems and standardize processes. Instead of having to check or transfer something three or four times, with a personnel tool it only takes one click to obtain or process the required information. This gives HR managers more time and allows them to deal with requests and requirements from even more employees.

More time for real HR work

HR managers can invest the time freed up in a company’s most important production capacity: people. Existing employees can be trained, motivated and managed through high-quality HR work. This allows the company to stabilize and grow.

Employee motivation

It’s not just HR staff who need time to administer an employment relationship. The employees themselves also need time to provide and retrieve their information. With personal access to HR management software, they can record their working hours, request their absences, e.g. leave, view and provide their contracts and documents or even provide their employer’s personnel details centrally. Everything in one place, digitally and without paperwork.

Employee participation

Human resources is work with people. People don’t want to be told what to do, they want to have the chance to participate proactively. They often lack the opportunity to do so. HR tools give employees the opportunity to get actively involved, to get in touch with their employers and to actively decide how their data is used. This allows employees to be proactively involved in the process.

Deadlines and legal requirements at a glance

Deadlines such as expiring employment contracts, expiring qualifications or certifications, exceeding KFB days per year or reaching the maximum assignment period are particularly important in HR. Keeping an eye on these deadlines is a complex and often error-prone process. HR management software can help here with automated processes and optimized views. Data validation and technical automation can significantly reduce the susceptibility to errors. This automatically reduces the risk and stress for everyone involved.

Data protection and data security

Storing personal data on paper or in an Excel file, for example, is highly questionable from a data protection and data security perspective. The paper can be easily stolen or removed without leaving any residue. An Excel list can quickly be shared with unauthorized third parties. Such actions can no longer be reversed or traced. Many companies process their personnel data, which is particularly worthy of protection and confidential, outside the current state of the art for the storage and processing of personnel data.

Personnel management software can prevent access by unauthorized third parties through data encryption measures and various security techniques. It is also possible to trace any changes based on users so as not to break the chain of custody. Such procedures are not financially or technically feasible for individual companies. Manual and hand-operated solutions cannot keep up with this level of security. However, legislation is increasingly demanding the protection of corresponding data through correspondingly stricter legislation. The penalties for non-compliance or violation of legislation, e.g. through the imposition of fines, have increased noticeably in recent years.

Decentralized working – Remote Work

Decentralized working models and decentralized working, also known as remote work, have become increasingly important in recent years due to digital networking and global communication options. With cell phones, tablets and laptops, employees and HR planners can work around the clock from anywhere in the world. Thanks to digitalization, employees are discovering a new freedom.

Accordingly, they also expect to be able to access their tools, data and processes from anywhere. With cloud-based HR management software, HR planners and employees can access their information, such as rosters, documents, working hours and much more, at any time. access at any time. This increases the flexibility, deployment speed and motivation of everyone involved.

Which sub-processes does good HR management software cover?

The more comprehensive a personnel management software is, the more processes can be digitized and automated. The more processes can be bundled into one tool, the fewer tools and therefore media disruptions and manual transfers are required. In our view, HR management software should cover the entire life cycle of an employee. This includes the following sub-processes:

• Recruitment
• Onboarding
• Talent Management
• Personnel administration
• Personnel development and controlling
• Personnel communication
• Qualification management
• Personnel deployment planning
• Performance recording such as time recording with working time accounts
• Vacation and absence management
• Contract and document management
• Payroll accounting
• Handling external parties
• Evaluation options for strategic personnel planning
• Offboarding

What types of HR software are there?

There are many names and abbreviations for HR management software. These include human resource information systems (HRIS – Human Resource Information System), human capital management software (HCM – Human Capital Management) or human resource management systems (HRMS – Human Resource Management System).

At the end of the day, however, they refer to one and the same thing. The only difference is often the scope of services, i.e. which sub-processes these systems map.

Who should use HR management software?

Administration software is of interest to any company with more than one employee. Because regardless of whether there are one or a thousand employees, the legal requirements are the same or very similar. The more employees a company has, the more important and significant the effects that can be achieved with such a tool. However, close attention should be paid to the company’s industry-specific requirements. As with any other software, each has strengths and weaknesses that the company should be aware of before implementation.

How expensive is HR management software?

No exact statement can be made here due to the variety of options. The range is wide, from a few euros to tens of thousands of euros per month. The price is often based on the range of functions and the number of employees. Here too, the following applies: the more employees, the lower the costs and the greater the effectiveness.

In the price structure, it is essential to differentiate between the billing type. There are offers per employee and month, per personnel planner or flat-rate packages. It is recommended that you carry out a precise price analysis in advance to avoid any nasty surprises as the number of employees increases.

When is HR management software worthwhile?

This question is quickly answered by extrapolating the working time to be saved by those involved. The working time saved by both HR staff and employees can be extrapolated. Implementation often pays off after just a few months.