HRIS Optimization and Business Strategy Alignment
HRIS technologies are designed to support specific size organizations and industries, each providing unique human resource metrics to support your talent management and business strategy.
HR & Business Strategy Alignment
HR objectives and corporate objectives should be one in the same. One strategy should not be formulated without input from the other. This strategic alignment needs to happen at all levels of the organization and across all key areas of the business (Cherington, 2023). Ultimately, a sound HR strategy and competent HRIS system will improve the capabilities of the organization, thus propelling it to achieve organizational success. The organizational strategy and objectives are going to drive a lot of the decision making for which HRIS system is selected and how it operates.
Four areas of focus for HRIS systems
Leonard (2024) outlines four broad areas of focus for HRIS systems and these focuses include: operational, tactical, strategic, and comprehensive. Companies that are looking to primarily use internal data will have more of an operational focus and may look for HRIS tools that optimize internal processes.
A tactical focus might look like an organization that works closely with outside vendors and a temporary workforce thus needing to streamline those activities.
Some HRIS platforms might offer leaders a strategic lens into their human capital and workforce, helping them plan for business change or expansion.
Then of course there is a comprehensive HRIS focus which would collate all HR activities into a single platform, allowing seamless integration of all human capital related functions in the organization. A comprehensive HRIS system may also be called a human resource management system (HRMS). To further simplify, an HRIS system is designed to support data tracking initiatives with minimal interaction. An HCM is designed to help develop employees. The HRMS is the best choice for organizations that want to leverage data and develop their workforce.
Lastly, an HRMS, may be part of a larger system called an ERP (enterprise resource planning), but can also stand alone. Oracle, and SAP are two of the largest ERP providers in the world, and also are leaders in the Gartner magic quadrant for HRIS systems for enterprises. Other Vendors in the magic quadrant include Workday HCM, UKG Pro, Paycom, and Ceridian Dayforce. The HCM market is estimated to be worth $58 billion (Workday Investor Report, 2023).
What can an HRIS system offer?
Most HRIS vendors offer similar capabilities, however, they tend to differentiate by sector, industry, and size of the business. Some of the baseline features include onboarding management, document management, time management, payroll, performance management, and mobile accessibility. These functions all need to satisfy key stakeholders in the organization, and some of their functions include HR, IT, Payroll or Accounting, and managers (Leonard, 2024). Over the last 10-15 years, organizations have needed to evaluate a much more impactful feature – on-premise or cloud. Most vendors now aren’t giving new customers an option.
On-premise or Cloud?
On-Premise HRIS
One of the key elements of an on-premise environment includes organizational ownership of the hardware and the organization purchases licenses to use it. This includes the servers, which generally last 5-10 years before an upgrade is needed. On-premise comes with initial high costs for hardware and software and then additional maintenance costs. A few reasons why companies opt for staying on-premise include the advanced customization ability and to mitigate cyber security concerns (Carlson, 2021). In a recent global tech trends survey (Equinox, 2022), cyber security was the number one priority and threat for business leaders. For organizations that do go to the cloud, they tend to have their data stored across multiple cloud platforms and prefer the private cloud over the public cloud. Customization is extremely valuable for businesses that have unique or complex business processes because, quite often, an HRIS out of the box won’t report the data necessary to make critical business decisions. In fact, it may create a number of gaps. Over-customization could also be a reason a company stays on-premise. Some companies see the cost of migrating to the cloud as an expense, while others see it as an investment.
Cloud HRIS
The case for going to the cloud is becoming significantly stronger as technology advances and there are more client success stories to share. Some of the benefits of going to the cloud include a reduction of physical resources needed to run applications, a reduction of financial resources needed to maintain the system, and risk mitigation for system down time. Services can also be purchased on-demand and the cost is spread out over a monthly basis via a SaaS model.
There are some additional considerations for businesses depending on industry, sector, and company size. Organizations in highly regulated industries such as Healthcare, Medical Devices, and Aerospace & Defense (A&D) will have very different needs than retail organizations. As an HRIS vendor, they need to understand the differences between industries and how it impacts required features. This is why so many vendors break up their sales teams by industry and size of company. In a TechValidate study shared by Griffis (2021), the larger your business, the more likely you are to improve time to value with a move to the cloud. Mid-market organizations saw the biggest improvement in employee satisfaction, and small businesses reported more peace of mind after a migration than any other category. To summarize, large organizations tend to look for efficiency, medium organizations often prioritize performance, and small organizations look to maximize their resources.
Conclusion
Successful talent management stems from having a strategic alignment of business and HR goals. The needs of an HRIS system will vary depending on the size of the business and the industry, and the resources required to implement and maintain the system will vary accordingly. An independent HRIS consultant is generally advisable in early stages of an implementation project to assess needs and opportunities, and an in-house or contracted project manager is always a good complement with your implementation partner’s team. If your organization has an upcoming HRIS project and needs a temporary HRIS consultant or is looking to hire on a full-time basis, please contact Main Line Talent Group at support@mainlinetalent.com or call 610-879-1941 to outline your requirements and schedule a consultation.
Cited Works
2022 Global Tech Trends Survey. The accelerated evolution of digital—a critical time for
transformation. (2022, March). In Equinix. Retrieved October 9, 2023
Cherrington, D. & Middleton, L. (2023) 2023 PHR/SPHR Unit 1 Business Management.
Edition 2023, (rev.15)
Griffis, G. (2021, July 15). What your business size says about your cloud migration.
Atlassian. https://www.atlassian.com/blog/platform/what-business-size-says-about-cloud-migration
Leonard, K. (2024, January). Best HRIS systems of 2024. Forbes.
https://www.forbes.com/advisor/business/software/hris-systems/
Other Helpful Resources:
HRIS Landscape Report - https://www.outsail.co/hris-landscape-report
About Main Line Talent Group:
Main Line Talent Group (MLTG) is a premier human capital consultancy and talent agency dedicated to optimizing human capital through the lens of ERP and HRIS technologies. Our team boasts expertise in talent attraction, development, and retention, partnering with businesses of all sizes to align their business objectives with strategic human resource initiatives. MLTG’s holistic approach to talent management ensures that clients leverage the power of their people to achieve organizational success while minimizing employee turnover costs. We pride ourselves on fostering long-term relationships and providing exceptional service, helping businesses thrive in a competitive marketplace. MLTG is located in the Greater Philadelphia Area and is the preferred human capital partner in the Mid-Atlantic region including, but not limited to Central and Eastern Pennsylvania, New Jersey, New York, Maryland, Delaware, and Virginia.
