HRMS vs HRIS vs HCM: what’s the difference?

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The short and practical answer is: none. Not least because so many vendors and software developers use them interchangeably. However, there are differences, so let’s explore a little further. First, what do these three acronyms stand for?

  • HRMS (human resource management system)
  • HRIS (human resource information system)
  • HCM (human capital management)

We can immediately see that HRMS and HRIS both refer to software systems (the ‘S’ in both stands for “system”) whereas HCM refers to a discipline or field. In that sense, HCM is arguably pretty much a synonym for “Human Resources”, just a somewhat fancier sounding alternate term. However, many vendors (especially those touting all-encompassing HR software suites for larger enterprises) use “HCM” as an umbrella marketing term. So far, so much the same. Time to compare…

 

HRMS vs HRIS

As to the two “systems”, you might imagine that differences might be found in the functions contained in the systems that these three labels represent, and certainly, a bit of googling will reveal various viewpoints.

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However, while most agree that the following functions and modules might be included – recruitment, benefits management, absence management, time and attendance, compensation, payroll, learning, self-service, reporting/analytics, onboarding, performance management, succession planning, analytics – there is little to no agreement at all on which function might be included under which acronym.

As a very rough guide, HRIS is often used for systems with more basic (more essential?) functionality, such as a personnel database, payroll, benefits, time and attendance, and applicant tracking. Whereas an HRMS would commonly include the HRIS functions plus applications for talent management, succession planning, and performance management.

However, HRMS is the broadest umbrella, having been used to describe anything from a fairly simple spreadsheet replacement database right up to the latest fully-integrated enterprise suite. In principle, a modern HRMS can potentially incorporate any and every kind of HR-related software application.

HRMS vs HCM

If HRIS indicates the more basic software, and HRMS is a fluid definition then it’s maybe logical that HCM as a software descriptor relates to systems at the all-singing, all-dancing end of the spectrum.

With a more specific emphasis than HRMS, HCM usually describes comprehensive suites of HR software, fully integrated, managing the entire employee life cycle, from developing talent pipelines for future recruitment to offboarding and pensions.

Furthermore, with the enterprise focus, an HCM suite’s analytics and reporting functions are likely to have a more strategic focus, aiming to dig deeper into the wide range of data available to such software.

As with our other terms, the marketing usage of “HCM” can make it frustratingly opaque but in general, HCM vendors are pitching at the top end of the HR software market.

HRMS vs HRIS vs HCM: is there really a difference?

One difference in how we define an HRIS used to lie in the type of data being stored. In the past, an HRIS would hold more static information (names, addresses, social security numbers, payroll figures) as opposed to some of the more ‘dynamic’ data associated with an HRMS or HCM, such as time-off days, performance management information, competency and development profiles, and so on.

Really though, these three acronyms have evolved organically, and often simultaneously; primarily driven by how software vendors choose to describe their products. One analogy that works is to imagine them as musical genres.

Jazz is very different to rock, and hip-hop to country. And there is no shortage of artists, record companies, writers and listeners who can define each genre in great detail. But those definitions are often subjective, not consistent, and subject to evolution over time.

Many bands cross and combine genres, not fitting neatly in any one category, and yet the person in the record store has to file them under one heading or another.

The bottom line is that whatever your HR software needs, there’s probably a perfect system out there for you. Knowing your specific requirements and using the above understanding of HRMS vs HRIS vs HCM, you can filter your search… but ultimately, whatever the vendor calls their system, your selection process needs to dig beneath the surface labeling.

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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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