Your HRMS requirements guide and features list
HRMS is a broad church.
Under that simple four-letter acronym lie all kinds of HR technology systems, from the basic and solid to the absurdly complicated. When you’re trying to work out exactly what HRMS features your organization needs, the possibilities can seem endless.
This 2021 HRIS project report found that companies, on average, spend $8,750 per each user of their system - that's a lot of money to spend on a system. Especially if you're selecting one for the first time, which according to report data, is the case for more than 50% of organizations sourcing a new system are doing so for the first time. The purpose of this guide is to walk you through the essential stages of HRMS requirements gathering, looking into what your organization and workforce actually need from an HR system, including a walk through the various available features and functions.
- HRMS requirements gathering in-depth
- Core HRMS features and what they do
- Advanced HRMS features
This HRMS features list includes the most critical HR software features:
- Performance management
- Workforce management
- Time and attendance
- Absence and leave management
- Learning and development
- Talent management
- Payroll is also a common feature of HRMS, but sometimes an add-on
HRMS requirements – finding out what you need
The task of putting together a list of HRMS features should not be underestimated. In fact, whether you end up with the right system for your organization or not depends heavily on this early investigative phase of the project. In a nutshell, requirements gathering has three basic stages:
- Look at what you have
- Gather input about what you want
- Be specific about the technical requirements
1. Look at what you have
It’s a cliché but it’s true: you may know where you’re going but before you can work out how to get there you have to know where you are right now. In HRMS terms, this means referencing two things: first, your strategic goals, and second, your current HR operation.
The first is simple in concept: take a look at your current business priorities (e.g. expansion, diversification, consolidation, etc.) and your current performance measures (e.g. your KPIs and any other measurable company objectives). Ask yourself, how the available HRMS technology can support these priorities and measures. Any HRMS feature that does not contribute to your business is, at best, a nice-to-have; at worst, an irrelevancy.
A new HRMS is your chance to improve (or fix) your current HR operations.
Which of your HR activities or processes could work more efficiently? Do any currently require ‘work arounds’ because the designed process is no longer fit for purpose? Do you still keep some data on spreadsheets? Which processes attract the most regular complaints?
Questions like this will help you home in on the weaknesses in your HR operation that a new HRMS could help address. The key actions here are:
- Creating a map of current HR processes to identify bottlenecks in efficiency
- Identifing paper-based HR process and shortcomings of existing HR systems
- Identifing key operational challenges you aim to solve with the new HRMS system
2. Gather input about what you want
This is the stage in which you consult your HRMS stakeholders. A stakeholder is defined by their degree of interest or influence over the project. The most common stakeholder groups are:
- Operational HR staff: the people who deliver your HR services will have expert opinions, from everyday hands-on experience, regarding the best functionality for your HRMS. Ask them about current system pain points and opportunities for improvement. In many ways, this groups have the most ‘at stake’ and are likely to be keen to engage with the project.
- HR Leadership and C-suite Executives: HR leaders are often HRMS project sponsors and the C-suite are the organization’s strategic decision-makers. Between them, they probably have the ultimate power over your project and expect to see valuable and measurable organizational benefits. Fail to consult (or convince) this group and the project won’t get off the ground. Do so, and they will be your strongest champions.
- Managers and employees: this group is best-placed to comment on how an HRMS should impact on the organization’s products and/or services. Will it make their daily working lives easier, or not? On a practical level, this group will most often be using the system’s self-service features, so input here is invaluable.
- Non-office staff: one particular group within the “managers and employees” group worth singling out is those who are remote, mobile, telecommuters, or otherwise not based in a traditional shared office environment. Mobile access and functionality is increasingly critical in HRMS design and this group will be your frontline experts on what is required.
- Specialist staff: any large organization will have a number of specialists aside from HR. Examples include Accounting & Payroll, IT, maybe Procurement, and each will have specific and valuable input to your project, including on the issue of what HRMS features are needed.
- External stakeholders: not everyone impacted by your HRMS will be an employee of the company. For example, your goods and services have an obvious potential effect on customers, and the quality of those goods and services depends on the employees providing them. How will your HRMS support and improve the delivery of goods and services? Similarly, when recruiting, job applicants are not employees yet, but are nevertheless on the receiving end of your HRMS’s hiring-related processes. What functionality will make that hiring process more effective for both applicants and the company?
Engaging with stakeholders is a critical part of the HRMS requirements gathering process. As for exactly how you choose to conduct that engagement, consider the following influence/interest categories:
- High influence, high interest – must be fully engaged and have their needs satisfied (e.g. C-suite and senior executives with responsibilities connected to HR and people management).
- High influence, low interest – should be kept satisfied, but bear in mind that they will probably have little to do with your project (e.g. C-suite members not directly related to HR or operations, such as marketing or sales).
- Low influence, high interest – usually those who will be day-to-day users of the HRMS; as such most of the bugs and teething troubles may be identified and addressed with their input and help (e.g. HR administrators, low to middle management).
- Low influence, low interest – should be kept informed but otherwise little time should be spent here (‘shopfloor’ employees, though arguably is unimpacted by a new HRMS).
Having exhausted your business context and stakeholders as information sources, the various requirements must be documented, reviewed and prioritized, resulting in a single document that can then be circulated with key stakeholders and project personnel for review and input.
3. Be specific about the technical requirements
This is the other side of your HRMS requirements gathering process. So far, the focus has been on features and functionality relating to users and processes; now it’s time to pull together the more mundane (but absolutely essential) details that underpin your HRMS’ performance and specification.
- Preferred delivery platform (cloud, on-premises, hybrid)
- Mobile access requirements (e.g. web app, native iOS, native Android, etc.)
- Language and currency requirements (if any)
- Integration with existing systems
- Any regulatory requirements that dictate the database structure
- Number of personnel records
- Number of users
Core HRMS features list
When talking to stakeholders about potential HRMS functionality, it’s wise not to leave the questions too open. Far better to present people with details of options that actually exist on the market; otherwise you’re likely to collate all the input and find you’re tasked with searching for the HR technology equivalent of a chocolate-covered unicorn!
What follows is a summary of the core, ‘everyday’ features or modules that can be found as part of most HRMS packages. Of course, each one will be unique in its own way but that’s what software demos are for…
|HRMS feature||What it does|
|Recruitment||Internal form-filling and authorization processes; posting of job advertisements and supporting documentation online, applicant tracking and sometimes even initial sifting of candidates. Emerging social media features may enable you to build talent pools as a source of suitable candidates for when a vacancy becomes available.|
|Onboarding||Prompts managers and HR staff to follow your organization’s onboarding and induction procedures; new recruits are ‘introduced’ to the organization and relevant colleagues; may automatically facilitate issues such as building access, user logins, security passes, etc.|
|Performance management||Automation of the appraisal and review process, tracking objectives and targets, and recording performance feedback.|
|Workforce management||Linked closely to the time and attendance and leave management functions, this is essentially a scheduling feature; often including real-time functionality matching workforce deployment to shifting needs.|
|Time and attendance||Monitoring all time-related employee issues, including attendance tracking, time clock management, and biometric systems. The resulting data is often shared with payroll and accounting software.|
|Absence and leave management||Allocation, booking, approval, tracking and monitoring of all absence from the workplace, including paid time off, vacations, compassionate leave, illness, parental leave, and even jury duty.|
|Learning and development||Often sharing data with the performance management module, the outputs here may include individual training plans for staff, training activity bookings, and follow-up evaluation and feedback processes.|
|Talent management||“Talent” can be defined as individuals with potential. This type of module supports setting up talent pipelines with succession planning and specific roles in mind|
|Analytics||Strategic HR analytics can be a major selling point to the C-suite. Drawing on all system data, an analytics module may include a dashboard of ready-made reports, real-time reporting, predictive capabilities, and automated data-gathering.|
Advanced HRMS features list
Not all HRMS modules or features are essential by any means. While all of the above list will be of use to most organizations, the following features can be seen as more ‘optional’ depending on your needs…
|HRMS feature||What it does|
|Benefits administration||The management and monitoring of employee benefits, healthcare and pension/welfare packages, including annual enrolment and necessary ‘paperwork’ when an employee leaves the company.|
|Payroll||While payroll is essential, it’s not necessarily so as part of your HRMS. However, there are accuracy benefits to integrating payroll and HR data in a unified system.|
|Social HRMS tools||More and more, organizations are looking to leverage the average employee’s familiarity with social media, building social tools into its cross-organizational collaboration features.|
|Social media integration||Some HR processes are taking advantage of connection to external social media; e.g. to build talent communities for recruitment, or using gamified induction/onboarding processes.|
|Managing non-traditional workers||More of a functionality within other features, this HRMS aspect is about managing the use of ‘non-employees’ such as freelancers, consultants and contractors, members of the so-called gig economy. Such functionality should facilitate streamlined recruiting, vetting and hiring of temporary workers.|
|Gamification||As an engagement tool, the popularity of gamification continues to grow. Often associated with the recruitment (automated testing) and learning (to acquire and test knowledge) functions of HR, gamification is the use of game-type elements and activities for assessment and communication. Challenges, levels, quizzes, points, badges and trophies are all potential facets of gamified HR processes. Points may be acquired by ‘beating a level’ or simply accessing an HRMS feature (to encourage use of said feature); some organizations link the points system to their reward and recognition package (‘Points mean prizes’!)|
|Mobile access||As mentioned above, mobile access is particularly useful for “non-office staff”, i.e. remote, field and telecommuting workers. Many HRMS vendors now offer apps to enable remote HRMS access via a mobile device. Such access is often accompanied by some form of BYOD or Bring Your Own Device policy, accepting the reality that employees will use their own mobile or tablet to log in (often from home or out of hours – for example, to review their benefits package and options at enrolment time).|
|Artificial Intelligence||As artificial intelligence and machine learning algorithms become more and more commonplace in the world, it’s no surprise to see AI incorporated into HRMS designs. Uses include faster and more detailed analytics and reporting, auto-parsing of resumes in recruitment campaigns, interactive automated onboarding, and even HR chatbots as the first line of assistance for staff with HR-related inquiries.|
|Wellbeing||Finally, one for the future. What used to be called ‘health awareness’ is now a broader heading of employee wellbeing and includes not only physical health but also mental and financial wellbeing, prompted by rising rates of employee stress and burnout. As business and HR commentators acknowledge this emphasis (seen in the volume of material on dealing with and supporting mental illness and stress at work, and in the increasing number of financial awareness training options available) it’s only a matter of time before the technology catches up. Watch this space…|
A final thought…
The above material is a one-stop starter shop for collating the functional requirements for your next HRMS. However, it’s worth being aware of a couple of classic pitfalls which could blow your project off course…
- Insufficient consultation: the complexity of your stakeholder population plus the inevitable time pressure in any project can make it tempting to only consult the ‘important’ and/or ‘knowledgeable’ stakeholders. Certainly, everyone’s input doesn’t carry the same weight but you do need an understanding of the full breadth of your HRMS’ impact and reach. Skimping on the consultation is a sure way to a system that only serves part of your organization.
- Beware of software vendors: another temptation is that of using vendors’ materials to inform your requirements gathering. Yes, they are a useful source of what the market offers but they take no account of you as a unique organization with unique needs. If you absolutely need some third party help, consider retaining an independent HRMS consultant for their expertise and input.
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