April 7, 2021

Top Ten Tips on Selecting and Implementing a HRIS System

A Human Resource Information System (“HRIS”) is a centralized system that stores, tracks, and manages data related to the human resources operations of your organization. The advantages of having an HRIS are numerous: a database of employee data that can be easily tracked and reported, automation of previously manual tasks, simplified approval processes, and more accurate payrolls all of which potentially saves a substantial amount of time.  

Information that can be stored on an HRIS system may include information on time and attendance, recruiting, benefits, absences, compensation, and training and performance management. Information can also be used to generate reports like organizational charts and EEO-1 reports, as well as statistics related to turnover, retention and new hires that can drive an organization’s strategic initiatives.   

As you contemplate whether or not to purchase and implement an HRIS system and decide what system is best for your organization, it is important to consider the following questions:

  1. What is your current payroll system’s capacity to integrate with the HRIS system you are contemplating? Does your current provider offer HRIS as an add-on?
  2. Is your organization planning to grow over the next five-ten years or stay the same size? Larger organizations may need more sophisticated and complex solutions, and even the smallest organizations may benefit from a solution.
  3. What are the budgetary parameters that you are working with? Keep in mind that the average budget per user is $125/user/month, according to a 2020 survey conducted by Software Path.
  4. What are your technology constraints? Do you have the server space, infrastructure, and IT staff to handle a purchased software product or is it better to purchase a cloud-based system (known as an ASP) that is hosted on the vendor’s servers instead? Again, according to Software Path’s 2020 survey, 88% of HRIS customers choose a cloud-based system that charge a monthly fee based on the number of users. A system that resides on internal servers may result in a higher initial investment but may become more cost-effective over time.
  5. What are your staffing constraints to select and implement a new system? Do you want to hire a consultant or do it yourself? It takes an average of 16 weeks from start to finish but can take much longer depending on competing priorities and the size and scope of the project.
  6. Do a thorough job investigating your options! It’s best to create an RFP and send to at least four vendors, form an internal committee that includes someone from IT, and include onsite demos and client references as part of the process.
  7. Make sure that you factor in time for training on the new system and ask about the level of support available after implementation. There is often resistance to change on the part of employees and management. Training helps. 

Here are some additional tips and advice from Matt Oldani, Vice President, Operations at Deaconess Foundation, an HR/AA client who recently selected such a system. 

  1. When you identify what you need and don’t need, make a list of “must have and would like to have.” It is easy to get carried away by what is available. Keep coming back to what you really need. Don’t buy a mansion if you only need a studio apartment!
  2. Don’t let someone else tell you your business. Often you will hear that you are too small for an HRIS system.  If you’re willing to make the investment now, there might be other savings down the road. Even the smallest organizations can benefit from the automation and recordkeeping that an HRIS system brings!
  3. Keep in mind the end result: Eliminating some of the transactional work of HR leaves us time to focus on onboarding, staff development and HR strategic matters like retention and engagement. 

HR Advantage/Advisory is ready to assist you and talk through options or implement the solution you select. 

Sources: HR.com, “Factors to Consider When Evaluating an HRIS System” Software Path, “2020 HRIS Software Support Survey” SHRM Tools and Samples, “How to Select an HRIS”

The views and opinions expressed in the article represent the view of the author and not necessarily the official view of Clark Hill PLC. Nothing in this article constitutes professional legal advice nor is intended to be a substitute for professional legal advice.
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