HRMS on a budget: a brief guide

It doesn’t matter what the state of the economy is, keeping costs down is always good business sense. However, when it comes to choosing HRMS software, there’s always a balance to be struck between functionality and price and the cheapest option is rarely the best one for your needs. But what happens when price really is the overriding factor? Is it possible to go low-cost and still acquire a solid, functional HRMS for your organization? Here are four possible routes to HRMS on a budget.

Keep your requirements realistic

Feature-rich, cutting edge systems are not really an option if price is an issue. Better to focus on sourcing a system with a few reliable functions that will provide you with benefits, such as the basic personnel database and time and attendance management than a feature-crammed system with a suspiciously low price tag – remember the old saying, you get what you pay for.

Cost-cutting measures

Consider what you might cut out of the HRMS selection and implementation process without risking the quality of the outcome too much. For example, buy off-the-shelf rather than a customized system; customization usually costs both time and money. Or consider not implementing employee self-service features. Yes, this limits the functionality but it also greatly limits the number of users, and fewer users mean less user training – another expense. Or select and implement your system yourself, avoiding the use of an external HRMS consultant. If your requirements are simple (and if your organization is small) this shouldn’t be a significant risk to a successful project.

This up-to-date software pricing guide will help you build an accurate HRMS budget forecast

You might be tempted to cut down on implementations steps such as data cleansing and migration… don’t.


Cloud, cloud, cloud. Cloud HRMS solutions tend to be sold with a subscription pricing model rather than a license fee. Not only is this a lower upfront expense, but given the size of your subscription will likely relate to either the number of users or the number of records on the system, you’re only paying for what use. Once upon a time ‘Pay As You Go’ was the budget entry into cell phone ownership; same thing.

Go open source

Open source software vendors usually offer a free version of their product. Open source also means you have access to the source code and therefore some very flexible customization possibilities if you have the necessary coding expertise. Open source HRMS used to be basic in terms of features but that’s changing rapidly. What’s more, while there may not be a structured aftersales support service (unless you pay extra) open source options are often well-supported by an enthusiastic developer community. Free-to-download open source HRMS include IceHrm, OrangeHRM, Sentrifugo and SimpleHRM.

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Dave Foxall

About the author…

Dave has worked as HR Manager for the Ministry of Justice for a number of years, he now writes on a broad range of topics including jazz music, and, of course, the HRMS software market.

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Dave Foxall

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