The HR Wars: HCM vs HRIS vs HRMS
Tuesday, September 6, 2016 11:54:04 AM

They say that the universe is constantly expanding. Every minute a new planet is discovered and every minute a new star explodes. In many ways, the world of business emulates our universe. Every day a new business spurts while others crash down. Every day a new concept is devised while another is made redundant. With so many interconnected and interdisciplinary activities being conducted side by side in our economy, there rises a conflict when it comes to directing your boat of business towards the success island. One of these impediments that businesses face today have to do with the human resources.

Traditionally there was no separate department for human resources. There was finance, marketing, etc. but no human resource. Then with the industrial revolution came the need for a supervisor to maintain the labor force. This individual served as a middleman between the company and the labors. But with the onset of the tech-boom the need for skilled staff hiked overnight. The need for training and development of employees became vital to an organization and they soon realized the importance of the human resources.

Today, there are separate distinct firms that operate entirely in the field of human resources, whether it is through providing consultancy, certification, training, etc. The promotional measures taken by such firms created terms that were tossed like lettuce in a Caesar salad. This created more confusion than solutions. The most popular of these terms being HRIS, HCM and HRMS. So what exactly are they?

Human Resource Information System is essentially a software designed for effective management of procedures, policies and people. The majority of human resource vendors pitch HRIS only to cater to the U.S audience, i.e., the U.S citizens. There are nine major capabilities that actually define HRIS. These include:

  • Reporting
  • Open enrollment
  • Compensation Management
  • Recruiting
  • Absence Management
  • Training and Development
  • Self Service
  • Core Human Resources
  • Workflow

Human Capital Management, is a software that comprises of every element present in HRIS, with an additional topping of Talent Management and global abilities like country specific formatting, localization, multi-currency and multi lingual. Some of the major functional elements that categorize a vendor’s solution as an HCM are:

  • Analytics
  • Global
  • Salary Planning
  • Succession Planning
  • Budgeting
  • Goal Management
  • Onboarding
  • HRIS

Human Resource Management System, is a software that provides services that cover every essential ingredient of HCM and HRIS. Since the HRMS businesses are so massive and cover a wide variety of employee population and functional requirements, not all HRMS service providers possess a progressive Talent Management substance in their offerings. It can sometimes be regarded as highly comprehensive as compared to HCM and HRIS. This stems from HRIS initially being contemplated as an interconnected database system and HRMS being a pedestal above those interconnected databases.

What exactly do these systems manage?
The major objective of any HCM, HRMS and HRIS software solution is to provide a business owner the control over every aspect of talent and personnel management. Some of these responsibilities for the software include:

  • Tracking the contact information of potential hires, applicants and existing employees
  • Tracking overtime, bonuses, pay histories
  • Assessing the workforce needs
  • Benefit tracking
  • Employee goal and career tracking

What kind of opportunities prevail for HCM, HRMS and HRIS?
A plethora of companies sell hundreds of different types of systems. But before settling on one of these it would be highly advised that you determine which method of implementation would be paramount to your organization.

Subscription Solution
You will be required to pay periodic subscription fee and an initial set up fee to allow your company access to the HRMS or any of the other similar systems hosted by the vendor. These come with customization options which are managed and hosted offsite.

In-house Solution
You will have to purchase a license by paying some nominal fees. This will most probably include substantially more customization options than a subscription solution. Eventually the systems and the software are inculcated by your company’s in-house IT team with some additional support from the vendor.

Hosted Solution
This is essentially a hybrid of the aforementioned solutions. In a hosted solution, the software is licensed or purchased but it is still hosted and inculcated through a remote location and serviced by the vendor.