Human resources technology refers to all of the software used to track, manage, pay, understand, find, inform, remember and deliver benefits to the people in an organization. As you might guess, the more people in the operation, the more complicated the HR software. For example, larger organizations have people problems that are unimaginable in small businesses.
There are between 70 and 100 discrete types of HR technology in total. This article will act as a cheat sheet to the 20 most important types of HR software.
Core HR Technology
Core HR includes all of the tools required to do the basics.
- Payroll. There are often many bits of software combined to make the payroll system. It includes all of the elements and data required to make payday happen. Executive bonuses and sales compensation are the primary complicators of the payroll process.
- Time and attendance. Time clocks, attendance and time keeping are the foundation of this area, which often includes scheduling.
- Workforce management (WM). WM includes keeping track of time off, vacation schedules and the allocation of people to shifts. In highly technical environments (e.g., aerospace or nuclear), a specific set of skills may be required to have a shift.
- Benefits administration (BA). The core challenge is making sure that benefits are effectively and equitably distributed. BA complexity grows when organizations decide to become self-insuring. Pension management falls under this category. When medical information is included, some of the data is governed by the Health Insurance Portability and Accountability Act (HIPAA).
- Human resources information system (HRIS). The HRIS is the central repository for information about employees. Usually, the data is assembled in profiles that can include a skills inventory and personal contact information. The HRIS is often referred to as the “system of record”. The HRIS can serve as an employee directory.
- Org charting. The more complex the organization, the more time is spent figuring out how to explain who works for whom. A good org chart helps everyone understand who goes together. Great org charting software is indispensable when the operation is required to adjust due to layoffs or changing business conditions.
- Data and analytics (D&A). The depth and array of data in the HR department (and the company) make it useful to have tools specifically designed to illuminate the performance of both the HR department and the people in the company. Usually, installing a D&A toolkit requires solving a series of data integration problems. The project is often undertaken because the benefits extend well beyond simple data integration. It takes a clear data strategy to be able to effectively understand how the organization operates.
- Employee communications (EC). In the old days, EC was as simple as publishing the employee newsletter and getting the benefits brochures right. Today’s EC function includes engagement surveys, email campaigns, feedback loops, recognition software and collaboration systems.
Talent Management Technology (TM)
The contemporary TM function is responsible for employees, from acquisition through disposition. Where Core HR technology focuses on administrative details (like inventory management), the TM function is focused on the match between employees and the actual work. TM identifies staffing requirements and is responsible for the development of employees.
- Talent acquisition (TA). TA is the sum total of the technology required to identify, recruit and onboard a new employee.
- Applicant tracking system (ATS). This is the heart of the recruiting operation. Most recruiting workflow is wrapped around the ATS. A good ATS ends up being a tool for tracking regulatory compliance on hiring issues. It usually contains a searchable resume database and the elements of hiring.
- Sourcing (recruitment marketing). Sourcing is the discovery of potential employees. This area grows faster than any other aspect of HR technology. It includes over 35 discrete functions that range from job postings to email campaigns to database tools.
- Pre-hire assessment and screening (A&S). Pre-hire processes range widely depending on industry, region and level of employment. Drug testing, background checks, polygraphs, personality tests and reference checks all have levels of automation and data flows. The data can be kept in either the HRIS or the ATS depending on the software.
- Onboarding. Onboarding software is used to standardize the completion of regulatory forms, the allocation of software and passwords and, sometimes, to enhance the new employee’s move to productivity.
- Performance Management (PM). PM technology is used to track goals and assess employee performance. These tools used to be executed on an annual cycle. Today, the PM world is being re-evaluated. Some very large companies have stopped using traditional PM tools.
- Succession Planning (SP). SP software tracks and manages the decisions associated with the management of replacements. It contains the promotion plan and the executive succession plan. The idea is to understand what will happen in unforeseen circumstances as well as who the most promotable leaders are.
- Compensation (Comp). Comp software houses market-based compensation studies, job descriptions and (sometimes) competency libraries. Comp management software is used to assure that the company is adhering to its compensation philosophy and offering wages that are competitive.
- Learning and Development (L&D). The L&D (or training) department is responsible for the acquisition, development, design, delivery and recordkeeping of company training. The software used to do this is called a learning management system (LMS). This is often the largest function in the HR department. Technology changes are making this a dynamic part of HR.
- Workforce Planning (WP). WP is the long-range strategic look at the company’s need for various kinds of people. It is a reality check on strategic plans. One aspect of WP is trying to understand how to help the workforce develop to meet those future requirements.
Now that you know HR technology basics, check out “How to Use Technology In Your Recruitment Process.”
John Sumser is the founder, principal author and editor-in-chief of the HRExaminer Online Magazine. John explores the people, technology, ideas and careers of senior leaders in human resources and human capital. John is also principal of Two Color Hat where he routinely advises human resources, recruiting departments and talent management teams with product analysis, market segmentation, positioning, strategy and branding guidance.
