What is HR Software?

  • Business Advice
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Peninsula Team, Peninsula Team

(Last updated )

In this guide, we'll discuss HR systems, the benefits of using HR software, and how Peninsula can make your HR processes easier.

HR software is a set of digital tools designed to streamline your business's HR and management of staff. Also known as HR systems, or HR management systems - they are a necessity in the modern business world.

HR software allows you to handle HR tasks with ease. For example, in some systems, you can digitally manage annual leave requests. As a result, you save time - which you can then spend on growing your business.

In this guide, we'll discuss HR systems, the benefits of using HR software, and how Peninsula can make your HR processes easier.

What is the use of HR management software?

Businesses use HR management software to assist in the management of important HR processes, such as succession planning. But there are many more. Other examples of what HR software and HR systems cover include:

Not every business uses HR software, but if you’re struggling to record your documentation - or ensure your legal compliance, it might be time to invest in one.

Why is HR software important?

Using HR software comes with extensive benefits. For example, it can speed up the employee onboarding process, by allowing you to signpost all the information your new hire needs to succeed.

Let's discuss the reasons why HR software is important in more detail:

Aids efficiency

One of the main reasons why using HR systems is important is that it can aid your efficiency. Manual processes, such as approving holidays or other paid leave can be time-consuming.

So by using an HR system, you can add an extension to your calendar and see when people have booked leave. Making your company more efficient and freeing up time to grow your business further.

Increases employee engagement

HR software allows you to gather direct feedback from your employees. For example, you could run a digital employee engagement survey. This is a survey carried out by employers to find out how engaged their employees are.

The information provided in these surveys can help you understand what parts of your business need improvement. Once you've listened to your staff and made changes, their satisfaction and engagement at work will likely increase.

Helps to organise HR information

HR software also helps your HR teams to secure and organise important information and HR data. This includes information about the company, employees, and customers. For example, you're able to store records that confirm an employee’s level of training.

Having an effective HR system in place will mean all your HR information and documentation is centralised and stored in one place. Making it easy for you and your HR team to find it when required.

Improves legal compliance

HR software can also help improve legal compliance throughout the business. Having all your important documents stored in one place will aid you when legislation changes - as you can update your records with ease.

This'll prove especially valuable if you ever have a Health & Safety inspection, as you may need to show your employees have the correct qualifications to work with certain machinery.

Protects employee data from security risks

HR software can also protect employee data from security risks. As a company owner, you'll have a high amount of sensitive employee information that falls under the control of HR departments, but having an effective system means you're protecting both yourself and your employees.

An HR system includes features to help with this, such as:

  • Permission controls that regulate user access to confidential information.
  • Password policies to protect against breaches.
  • Digital signatures that notify teams of document revisions.

Helps with remote or hybrid working

Having an online HR system in place can help ensure important HR processes and procedures are managed correctly, no matter where your staff are.

For example, your HR professionals may need some documentation signing urgently, but with HR software, they can do this digitally with ease. It can be a great way to oversee and motivate your workforce, whether they're working in the office or at home.

Different types of HR software

There are many different types of HR software available, each with its own set of benefits. You must become familiar with each of them so you can make an informed decision for your company. Remember, what works for one business may not necessarily work for another.

Let's discuss them in more detail:

Human resources information system

Human resources information systems (HRIS) store any data from an HR department. This includes personal records, employee pay, benefits, attendance records, leave allowances, and performance. They help with the daily running of all your core HR services, including:

  • Recruitment.
  • Management.
  • Legal compliance.
  • Employment details.

An HRIS system can help your HR professionals to make informed decisions on hiring, training, or compensation. As well as ensuring legal compliance, and helping with the day-to-day running of the business.

Human resources management systems

A human resources management system (HRMS) is different from other HR software systems as it's more focused on both talent and cost-efficiency. For example, HRIS is focused on storing information, whilst HRMS is more about managing information and employees.

Many companies use HRMS to manage payroll. This is because it can automate the process by calculating salaries based on the following factors:

  • Skills.
  • Experience.
  • Bonuses.

Human capital management

A human capital management HR system is fairly similar to HRIS, but includes more in-depth tools for analytics, reporting, and employee performance. This type of system can make employees feel more valued whilst working for you, and in turn, stay with your company for longer.

Human capital management can help build trust between employer and employee, by providing transparent performance information. It helps to support a variety of activities, such as development, learning and employee retention.

Applicant tracking systems

An applicant tracking system is an HR system which is entirely focused on making both the recruitment and hiring process easier for the employer. It can help the hiring manager sort through a large number of applicants, as well as manage information related to different candidates, all in one place.

As well as this, you can use this HR system to compare candidates against each other, helping you to find the perfect fit for your business.

Payroll software

This type of human resource system is focused on payroll and saving HR teams by organising employees' wages, bonuses, and commissions.

This automated system can speed up the process of calculating, processing, and distributing employee pay on time. As well as generating paychecks before the pay date. It can also help with:

  • Tax withholdings.
  • Payroll deductions.

Onboarding software

HR software for onboarding can make the process of starting someone new as easy and stress-free as possible. It can help your HR team to get all the relevant paperwork ready, and signpost information the employee can access as and when they need.

The last thing you want is for someone new to have a bad first impression about your business, and for their employment to start off on the wrong foot.

Performance management systems

This type of HR management system is focused on the performance of your employees, providing you with insights about how your teams work together.

It can also help senior staff and management teams to make informed decisions regarding internal promotions and other development opportunities.

How to choose the right HR software for your company

As an employer, choosing the correct HR system for your company is vitally important and shouldn't be rushed. To ensure you're choosing the right one, you should decide what the main priorities are for your business not just in the short term, but in the long term as well.

Speak with your HR team to see what areas could be improved, and how each different HR software available can help. There's no point in introducing an HR system that doesn't match the aims and needs of your employees.

As well as this, take a look at the results of your engagement surveys and the answers your employees have given you. If for example, a common theme is complaints about a slow annual leave process, then consider introducing an HR system that speeds this up.

How Peninsula's online HR software can streamline your HR

With Peninsula's HR management software, HR has never been easier. You can build and share rotas, approve holidays, track overtime, and even pull absence reports.

And on top of all that, you even get unlimited cloud-based storage space, helping you to keep all your legal documents secure.

Our complete HR management system can save you both time and money, allowing you to focus on growing your business even further. All your HR tasks will be stored in one easily accessible location, making the management of them easier than ever before.

If you're looking for full-scale HR solutions, contact Peninsula today for a free demo.

Get expert advice on HR software from Peninsula UK

When running a business, HR can take up a lot of your time. But having HR software in place can save you time and money.

Peninsula offers expert advice on all things HR. Our HR software provides you with the ideal solution for all your HR needs.

Want to find out more about human resource management and HR support? Contact us on 0800 028 2420 and book a free consultation with one of our HR specialists today.



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