HUMAN RESOURCE

INFORMATION
SYSTEM (HRIS)
 AN INTRODUCTION TO HRIS

Human Resource Information System (HRIS) is a systematic way of storing data and information
for each individual employee to aid planning, decision making, and submitting of returns and
reports to the external agencies. It is an online solution for the data entry and tracking of a
company's human resources department information, payroll, management, and accounting.

A human resource information system (HRIS) is defined as a computer based application for
assembling and processing data related to the human resource management (HRM) function.
As in other types of information systems, an HRIS consists of a database, which contains one or
more files in which the data relevant to the system are maintained, and a database
management system, which provides the means by which users of the system access and utilize
these data. The HRIS thus contains tools that allow users to input new data and edit existing
data; in addition, such programs provide users with the opportunity to select from an array of
predefined reports that may either be printed or displayed on a monitor. Reports may address
any of a number of different HRM issues (e.g. compensation planning, equal employment
opportunity monitoring). HRISs also generally include tools by which users or system
administrators may generate ad hoc reports and select specific cases or subsets of cases for
display.

It merges HRM as a discipline and in particular its basic HR activities and processes with the
information technology field.

It can be used to maintain details such as employee profiles, absence reports, salary
administration and various kinds of reports.

An effective HRIS provides information on just about anything the company needs to track and
analyze about employees, former employees, and applicants.

Thus, in a nutshell, an HRIS system serves the following functions:

 Storing information and data for each individual employee.

 Providing a basis for planning, decision making, controlling and other human
FUNCTIONS

 resource functions.
 Meeting daily transactional requirement such as marking absent and present and
 granting leave.
 Supplying data and submitting returns to government and other statutory agencies.

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 PROCESS OF HRIS

Step 1. Inception of idea: The idea for having an HRIS must

originate somewhere. The originator of the idea should inception of idea
prepare a preliminary report showing the need for an HRIS
and what it can do for the organizations. feasibility study

Step 2. Feasibility study: Feasibility study evaluates the selecting project team
present system and details the benefits of an HRIS. It
evaluates the costs and benefits of an HRIS.
defining requirements
Step 3. Selecting a project Team: Once the feasibility study
has been accepted and the resources allocated, a project vendor analysis
team should be selected. The project team should consist of
HR representatives who are knowledgeable about the package contract negotiations
organization’s HR functions and activities and about the
organization itself and representatives from both training
management information systems and payroll. As the
project progress, additional clerical people from the HR tailoring the system
department will be needed to be added.
collecting data
Step 4. Defining the requirements: A statement of
requirements specifies in details exactly what the HRIS will
do. A large part of the statement of requirements specifies
testing the system
in details of the reports that will be produced. This includes
the written descriptions of how users collect and prepare starting-up
data, obtain approvals, complete forms, retrieve data, and
perform other non-technical tasks associated with HRIS use. running in parallel

Step 5. Vendor analysis: This step determines what maintenance

hardware and software are available that will better meet
the organization’s needs for the lowest price. The result of
evaluation
this analysis will determine whether to purchase with whom
at what price level?

Step 6. Package contract negotiation: After a vendor has been selected, the contract has been
negotiated. The contract stipulates the vendors’ responsibilities with regard to software ,
installation, service, maintenance, training and documentation.

Step 7. Training: Training beings as soon as possible after the contract has been signed. First,
the members of the project team are trained to use the HRIS. Towards the end of the

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implementation, the HR representatives will train managers from other departments in how to
submit information to the HRIS and how to request information from it.

Step 8. Tailoring the system: This step involves making changes to the system to best fit the
needs of the organization. A general rule of thumb is not to modify the vendor’s package,
because modifications frequently cause problems. An alternative approach is to develop
programs that augment the vendor’s program rather than altering it.

Step 9. Collecting data: Prior to start-up of the system, data must be collected and entered into
the system.

Step 10. Testing the system: Once the system can been tailored to the organization’s needs
and the data is entered, a period of testing follows. The purpose of the testing phase is to verify
the output of the HRIS and to make sure it is doing what it is supposed to do. All the reports
should be critically analyzed for accuracy.

Step 11. Starting up: Start- up begins when all the current actions are put into the system and
reports are produced. It is wise to attempt start-up. Though the system has been tested, some
additional errors often start-up.

Step 12. Running in Parallel: Even after the new HRIS has been tested, it is desirable to run the
new system in parallel with the old system for a period of time to examine its accuracy.

Step 13. Maintenance: It normally takes several weeks or even month for the HR people to feel
comfortable with the new system. By this time errors are adjusted and handled.

Step 14. Evaluation: After the HRIS has been placed for a reasonable length of time, the system
should be evaluated for the successful survey in the organizations.

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 MODEL OF HRIS

INPUT SUBSYSTEM

HR research subsystem:

It gathers data about various aspects of human resources management such as

job analysis, job evaluation, employee morale, employee absenteeism and
employee turnover.

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HR intelligence subsystem:

It gathers human resources information from external environment both formally

and informally.

OUTPUT SUBSYSTEM

HR acquisition system:

The functions involved in this system are human resource planning, recruitment,
selection and placement.

HR development system:

HRD system requires information about the competencies that are to be

developed among employees.

 Appraisal system:

Appraisal involves evaluating an employee’s quality and performance for
devising suitable compensation package training, promotion, demotion etc.
compensation involves determining the incentives, benefits etc.


 Compensation management:

It is concerned with designing and implementing total compensation
package. Compensation is referred to as money and other benefits received
by an employee for providing services to his employer like provident fund,
gratuity, insurance scheme and other payment.

HR maintenance system:

HRM system deals with maintaining employees in the organization. It involves

human resource mobility in the form of promotion, demotion, transfer and
separation, caring for employees safely and health and managing stress that
employees may experience at the workplace.

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Industrial relation system:

IRS is concerned with managing good relations between management and

operatives. This involves designing of industrial relations mechanism, managing
employee discipline, redressing employee grievances and managing industrial
disputes.

THREE LEVELS OF HRIS

DATA APPLICATIONS

 Training Projects
• Economic trends
 Manpower planning
• Industry forecasts
 Pension fund investments
STRATEGIC • Manpower demand forecasts 




 Employee background and
 Recruiting
experiences
 Employee selection
 Performance
evaluation and  Employee placement
FUNCTIONAL rewards  Employee promotion
 Skills inventory  Assignments matching


 Internal Reporting
 Absentee rates
 Benefits programs
 Human resources accounting
 Compensation programs
 Productivity assessments
 Insurance programs
 External Reporting
 Employee demographics
OPERATIONS  Equity monitoring
 Position description
 Vacancy reporting
 Health & safety reporting

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 USAGE AND BENFITS OF HRIS
NEED:

Costly exercise:-

Personal records, when kept manually, do not offer up-to-date information at short
notice. It was difficult to make entries. The clerical involved is quite labor-intensive and
costly.

Inaccurate:-
NEED OF AN HRIS

The manual transfer of data from one record to another may increase the chances of
errors.

Fragmentation:-

Information is not available at a central, easily accessible place since records are kept at
different locations.

Difficult to analyze:-

The manual analyzes of data is time consuming and quite often not readily available for
decision making purposes.

When the organization grows in size the manual system fail to offer reliable, accurate
data at short notice.

APPLICATION & UTILITIES:

Personnel Salary Leave & absence Skill inventory

administration administration recording

HR Performance
planning USES appraisal

Recruitment Collective Career Medical

bargaining planning history
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Personnel administration - It will encompass information about each employee, such
as name address, personal details etc.

Salary administration - Salary review procedure are important function of HRM, a

good HRIS system must be able to perform what if analysis and present the reports of
changes.

Leave and absence recording - Essentially be able to provide comprehensive method of

controlling leave/absences.

APPLICATION & UTILITIES

Skill inventory - It is also used to store record of acquired skills and monitor the skill
database both employee and organizational level.

Performance appraisal - The system should record individual employee performance,

appraisal data, such as due date of appraisal, scores etc.

Human resource planning - HRIS should record details of the organizational

requirements in terms of positions

Recruitment - Record details of recruitment activities such as cost and method of

recruitment and time to fill the position etc.

Career planning - System must be able to provide with succession plans reports to
identify which employee have been earmarked for which position.

Collective bargaining - A computer terminal can be positioned in the conference room

linked to database. This will expedite negotiations by readily providing up to date data
based on facts and figures and not feelings and fictions.

BENEFITS:

Higher Speed of retrieval and processing of data

Reduction in duplication of efforts leading to reduced cost

BENEFITS

Ease in classifying and reclassifying data

Better analysis leading to more effective decision making

Higher accuracy of information/report generated

Fast response to answer queries

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Improved quality of reports

Better work culture

Establishing of streamlined and systematic procedure

More transparency in the system

Employee – Self Management

ADVANTAGES

The four principal areas of HR that are affected by the Human Resource Information System
(HRIS) include; payroll, time and labor management, employee benefits and HR management.
These four basic HR functionalities are not only made less problematic, but they are ensured a
smooth running, without any hitch. A Human Resources Information System (HRIS) thus
permits a user to see online a chronological history of an employee from his /her position data,
to personal details, payroll records, and benefits information.

The advantage of a Human Resource Information System (HRIS) in payroll is that it

automates the entire payroll process by gathering and updating employee payroll data
on a regular basis. It also gathers information such as employee attendance, calculating
PAYROLL

various deductions and taxes on salaries, generating automatic periodic paychecks and
handling employee tax reports. With updated information this system makes the job of
the human resource department very easy and simple as everything is available on a
24x7 basis, and all the information is just a click away.

In time and labor management a Human Resource Information System (HRIS) is

TIME & LABOR
advantageous because it lets human resource personnel apply new technologies to
effectively gather and appraise employee time and work information. It lets an
employee's information be easily tracked so that it can be assessed on a more scientific
level whether an employee is performing to their full potential or not, and if there are
any improvements that can be made to make an employee feel more secure.
EMPLOYEE BENEFITS

Employee benefits are very crucial because they help to motivate an employee to work
harder. By using a Human Resource Information System (HRIS) in employee benefits, the
human resource department is able to keep better track of which benefits are being
availed by which employee and how each employee is profiting from the benefits
provided.

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 HR MANAGEMENT
A Human Resource Information System (HRIS) also has advantages in HR management
because it curtails time and cost consuming activities leading to a more efficient HR
department. This system reduces the long HR paper trail that is often found in most HR
divisions of companies and leads to more productive and conducive department on the
whole.

HRIS TRACK

EXAMPLES
WITHOUT HRIS:
PERFORMANCE EVALUATION

• Prepare evaluation forms

• Print and copy them

• Distribute forms to employees

• Employees fill in evaluation

• Evaluation forms personally submitted to HR Manager

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 • Re-write results to the computer or file them

• Manual processing of data gathered

• Prepare result sheets

• Print, copy and distribute them to employees

• File all the forms for future use

WITH HRIS:

  Define evaluation forms

  Online evaluation Entry
  One-click access to results
  History info captured
  Evaluation reports
 Strategic Decision making process can take place

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WITHOUT HRIS:

LEAVE APPLICATION ADMINISTRATION

  Prepare leave application forms
  Print and copy them
  Manually maintain employee attendance information daily
  Maintain company calendar
  Employee applying for leave fills in an application form
  Application form personally submitted to Supervisor
  Manual check for employee’s leave status history
  Supervisor’s approval or rejection
  Application form personally submitted to HR manager
 Manual update of employee’s personal leave information file

WITH HRIS:

 Define company
specific leave
admin processes

 Online leave
application form

 Online leave
 approval/Rejection
 History info captured

 Leave balance
reports generated by
the system

 Saves strategic
resources

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 COMPANY ILLUSTRATIONS

SHAW’S SUPERMARKET

The Situation:

Shaw’s Supermarkets is the second largest supermarket chain in New England. With a
workforce of 30,000 located at 180 stores throughout six states, Shaw's HR staff is responsible
for managing employees' personal data. Their employee mix includes approximately 70 percent
part-time employees, consisting of students, senior citizens, second-job part-timers, and career
part-timers. One third of the workforce is made up of union associates, and Shaw's staff
oversees the company's involvement with three unions and six separate contracts (Koven,
2002). In order to help manage the workforce, the HR staff became interested in centralizing its
HR operations.

The Response:

In order to centralize HR operations Shaw’s decided to implement an ESS (employee self-

service) solution. The use of self-service applications creates a positive situation for HR. ESS
gives HR more time to focus on strategic issues, such as workforce management, succession
planning, and compensation management, while at the same time improving service to
employees and managers, and ensuring that their data is accurate. With this solution,
employees have online access to forms, training material, benefits information and other
payroll related information.

The Outcome:

Shaw’s has had positive feedback since implementing the ESS solution. "The reaction from our
employees has been extremely positive," Penney, VP of Compensation and Benefits, says. "We
even had a significant increase in our medical coverage costs, and it was almost a non-issue
because the online enrollment featured the plan choices, the employee cost, and the company
subsidy. An employee self-service application makes it very easy for them to understand their
contributions and coverage options. I received several e-mails from employees saying this was a
great change and how easy ESS was, which the case is not often when employees are selecting
their benefit options." (Koven, 2002). By giving the employees more access to their information
they are able to see the benefit choices available to them. Employees are also able to update
their information online, which helps reduce the paperwork of the past. Shaw’s has also seen
improvement in productivity because employees are updating information at home, not during
work hours.

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 LIMITATIONS
 It can be expensive

 Its effective application needs large-scale computer literacy among the employees
responsible for maintaining HRIS.

 Absence of continuous up-dating of HRIS makes the information stale.

 Thorough understanding of what constitutes quality information for the user.

 Computer systems are only as good as the data they have to work with, so if a public
agency or company starts out with bad information, there's not much a new system can
do about it.

 Small firms are internally incapable of HRIS applications and hence they need the help of
external resources.

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 CONCLUSION

HRIS is considered a strategic way to develop a new philosophy towards the way in which
people are managed in an organization. Many decision making strategies are based on HR
analysis, which is used to determine whether current HR capabilities are congruent with the
desired organisational objectives. The development of HRIS applications that cater to the needs
of human resources is very important. From a broader perspective, an HRIS yields a well
managed business with better informed employees. The implementation of HRIS applications
results in two benefits:

a) Efficiency of operations and streamlined HR administration.

b) Effectiveness when management can spend more time in decision-making and strategic
planning, and less time on information input and day-to-day HR administration.

In summary, this report has revealed the following:

 By automating Human Resource practices, HRIS saves time and money, effectively
reallocates work processes and thus provides competitive advantage and adds strategic
value to the organization.

 HR managers must make use of HRIS to achieve improved performance and removing
routine administration allows them to become professional consultants to the rest of
the organization.

 Comprehensive HRIS provides the needed information within the shortest period and at
reduced cost.

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