On HRMIS Service

HR Today's Rebecca Nicholson presents the first in a two-part series on Human Resource Management Information Systems - HRMIS. We begin by looking at tips for selecting a new system. Next month we'll look at HRMIS installation. 

When asked about the key values of their organisation, managers often state that 'our people are our greatest asset.' It stands to reason, then, that organisations have a vested interest in finding out more about their most valuable asset and using that knowledge strategically and efficiently wherever possible. 

This is where an organisation's Human Resource Management Information System comes in. 

Barry, an IT manager with a manufacturing company, puts it this way: 

'The HRMIS is central to the way an organisation sees itself and how it operates. Beyond just keeping personnel records, the way that employee and operational information is handled and analysed can be a key to adapting to changes in the business environment, improving performance and ultimately to organisational success.' 

So how does an organisation go about upgrading the way it manages HR information? Barry talks about his experience prior to recently upgrading his organisation's HRMIS: 

'Part of my position at that time was to manage the IT side of the existing HRMIS and, as our organisation had expanded significantly over recent years, this meant more and more time was spent in having to add features here and there as required, to patch faults and create `work-arounds' in the software just to keep things running smoothly. Also, our managers were increasingly frustrated by the absence of useful reporting tools which they wanted but our old system was just not flexible enough to deliver. As you can imagine, while we had grown, the system we first set up was struggling to keep pace. We decided it was time to look at either a major overhaul or replacing the lot!' 

This is a situation that many growing organisations will find themselves in. So where do you start in trying to replace an HRMIS? 

Working Out What You Need

There are many questions that will need to be addressed in order to select the right system for you. For example, what do you really want the system to do? How do you know what products are on the market? Who can supply and install a new system? How do different systems stack up against each other? How would a new system affect the structure of the HR department? How much will a new system cost, and what are the hidden costs of switching to a new system (like training and reprogramming)? Would it be better just to update what you have? If you go to a new system can you automate the transfer of existing database information? If you can begin to answer these types of questions, you will have a clearer idea of your needs and will better be able to navigate the minefield of hype surrounding different vendor's products. 

Carole, an independent HR consultant, stresses the importance of analysing your information needs before looking at what the market has to offer: 

'If you are going to select a Human Resources Management Information System (HRMIS) that will enable you to effectively manage the company's most important asset as well as play a role in broader strategic planning, there are a few things you need to consider. 

The first thing is to find out what type and level of information both line and senior managers need in terms of the workforce. 

Secondly, you need to identify those areas where current systems and practices can be streamlined and automated.  

You should also determine what the company's employees are looking for when it comes to keeping them informed about and involved in the range of areas which impact on them individually and as a whole. 

The one thing I would really stress is that the success or failure of a new HRMIS depends largely on the effectiveness and thoroughness of the needs analysis undertaken as the first step in the project.' 

Chris, an HR manager from the finance industry, agrees: 

'Consult widely within your organisation, particularly with those who will most use or access the HRMIS. Talk to general employees, line managers, your HR team, the accounting department and senior management, and develop a comprehensive understanding of your organisation's HR information management needs. It's also important to be clear on your budget. The cost of the software is only one element. Installation, implementation and training are all variables to consider carefully. Many packages will offer a range of impressive features. These will not all be necessary in every context. Sometimes essential features for your organisation may be absent from an otherwise comprehensive system. 

Once you've determined what your organisation's needs are, the next critical phase begins - researching and selecting the most applicable HRMIS to meet those needs.' 

Types of HRMIS

At the macro level, your first choice is between what is known as a 'best of breed' HRMIS (such as Peoplesoft or Aurion) or an `integrated' product such as Oracle, SAP or Mincom's Elipse. 

'Best of breed', or stand alone HRMIS, are systems designed exclusively for HR information management. Many are suitable for use in most small to medium-sized organisations and others are tailored for specific industries like retail, hospitality or education. 

'Integrated' HRMIS products tend to be modules of broader Management Information Systems. These MIS are often referred to as Enterprise Resource Planning (ERP) systems, which enable organisations to take an integrated approach to all of their information management. This means that the one system will manage information for HR, accounting and finance, asset maintenance, sales and marketing, job costing and scheduling, and so on. These types of HRMIS are mostly seen in large asset-intensive industries like mining, defence and communications. 

Ongoing technical support, training, upgrading and maintenance are also big areas where HR managers have encountered problems with their HRMIS. This is clearly an area you need to explore with a potential supplier to ensure that the level of ongoing support matches your organisation's requirements moving forwards. 

Steve, an HRMIS consultant, has these tips: 

'You should quiz potential suppliers on the level of support they provide during the installation and implementation of the HRMIS and determine whether or not this is appropriate for your organisation. 

Another important point is to look for are those HRMIS with a modular design. What this means is that the system is comprised of independent and individual modules which can be added to a basic system over time. So you might start with basic payroll and time-sheet functions, and then add modules for managing training, recruitment and selection, performance evaluation and so on.' 

So while upgrading your organisation's HRMIS can seem a daunting task, by first working out what you need, doing some careful research, and asking the right questions, you can find the system that is right for your organisation.  

NEXT MONTH: Part two of our HRMIS report - HRMIS installation.