How to Create a Human Resource Management System?
Human Resource Management System, or HRMS, is a set of software solutions used to optimize and automate the management of human resources and related processes throughout the entire life cycle of an employee. In this article, you will learn how to create a human resource management system and integrate it into your business.
When planning the development of a human resource management system, it is worth remembering that this is not a goal in itself, but a tool to achieve your business goals. Therefore, before starting to create an HRMS, you need to determine what goals you intend to achieve with its help. This will help direct your thoughts on the right track and align the project goals with the business goals of the company.
For example, if you have high employee turnover and your income is based on how quickly you can hire new employees and get them ready for the job, then your HRMS platform should be focused on helping you achieve those goals. More specifically, the goals of HRMS implementation will be:
To map the hiring business process, you need to interview all employees who are involved in this and describe the entire process: determining the need for hiring new employees, preparing a job description, finding suitable candidates, considering candidates and choosing the best among them, preparing for an interview, preparation of a recruitment proposal, interview and the final selection or selection of several people for the internship.
Example of a business map of the recruitment process by source. Source
Now that you have a complete understanding of how everything is working in your company at the moment, see if the process is well-ordered and if it follows one common pattern. If your business processes are chaotic and confusing, then integrating a human resource management system is likely to only multiply the mess rather than improve your HR experience. The saying goes very well here: "Garbage in, garbage out".
To avoid chaos in personnel management, bring all business processes to one standard: develop job descriptions and regulations, communication rules, etc. These do not have to be strict instructions, it is enough to draw up standard action templates (tips).
When you have regulated your business processes, see what can be optimized in them with the help of a human resource management system. The simplest example is the transfer of workflow from paper to digital format and its automation. HRMS can also automate the placement of hiring advertisements (on social networks and on other specialized platforms), collecting responses and screening candidates according to the most basic criteria (education, experience, expected salary, location, etc).
How exactly HRMS integration can improve your business processes, you can find out by consulting with the companies that develop HRMS solutions.
Once everything is in order with the previous step, you can start thinking directly about the vision for your human resource management system. If you are not a technician, it is recommended to seek professional help at this stage. How to find a technical partner, and what to look for when choosing one, is described in the article: «How to choose a developer company?».
Together with the developer company, you must develop a project specifications document that will indicate: goals, functions, design requirements and a development plan for your project to create an HRMS.
Typically, HRMS solutions have five modules: core, human resource management, talent management, recruitment and / or tracking systems, and learning management. When developing your human resource management system, you do not have to implement all of them. You can create only one or a few modules that you need, and add the rest as needed.
Main. A key part of any HRMS is its central employee information database, also known as core HR. This is where records about your staff are stored: personal information, job classification, benefits, employment history, compensation information, etc. This module also usually includes a self-service interface so that employees can view and update their information as needed.
Example of HRMS ADP employee profile
If analytical tools are built into the personnel management module, then this will make it possible to track personnel performance and its change over time - a very useful function for any business.
Employee Schedule Calendar in CakeHR
Some advanced HRMS can also help even with career planning, finding and training successors. This is done by tracking competencies and skills. The system itself will offer the prospective employee suitable career paths and recommend appropriate training to obtain the skill level required for the position planned for him.
Employee performance evaluation chart at Bamboohr
Viewing the structure of company employees in Paycor
Learning Management System interest in Ascender HRMS
Company leaders can use this data to make decisions that affect employee retention or business growth. In addition, sometimes in this way you can notice non-obvious things, for example, that after the installation of some equipment, the number of accidents at work increased, which may indicate the need for additional training of personnel.
Trendline reports for vacations, attendance and more
You need to plan the development and development of HRMS for your business in such a way that you have the opportunity to test the system or its parts without waiting for 100% software availability. Otherwise, you risk wasting time and money before you can see problems that may be related to the confusion of business processes, the transfer of data from your current database to a new HRMS, or a common mistake in the code.
The optimal solution here would be to divide the system into several segments, which the development team can create in a short period of time and immediately start testing them on real data and business processes. This way, you can see early enough if you are heading in the right direction to adjust the course of the system and stay on budget.
You can plan this development of your human resource management system using a method called SMART, which helps to define project goals and track their achievement. Use SMART to evaluate your HR processes and see if you can improve them.
You can integrate HRMS into your business in two ways: use a ready-made solution (for example, a SaaS service) or develop the desired product from scratch. HR ready-made products are more suitable for companies with standardized and well-established business processes like McDonalds, Walmart or Starbucks. If the company has a unique workflow, or it falls under the rules that were not taken into account by the standard HRMS, then the software for its personnel management system needs to be developed through custom development.
If you choose custom development, then the process of creating your human resource management system will look like this:
It is important to note that some time before the full readiness of the HRMS (usually at the testing stage), the company's personnel are trained to work with the new system. To do this, the product is launched in demo mode, when it can work with real data, but without affecting real business processes (like a demo account on exchanges).