Difference: HRMS vs HRIS vs HCM

You’ll be able to tell the difference between HRMS, HRIS and HCM once you have a basic understanding of them. But, it’s in the details where you will feel lost and confused. If you are struggling to understand the differences between HRMS, HRIS, and HCM, then we’ve prepared a post for you today. We’ll look at HRMS, HRIS and HCM, along with their key differences, to make things easier for you. Let’s get started.

What is an HRIS?

Human Resource Information System (HRIS)? It’s a bit like the old filing cabinets companies used to keep employee records. At one point, everything was written on paper: names, salaries and work hours. In the growing industries, it became necessary to find a better solution to manage this information. This was what HRIS did. It is, in that sense, the easiest HR software available.

A HRIS is a great tool for managing and storing information about employees, such as their names, titles, pay, tax, and time off. These systems are perfect for basic tasks like tracking payroll and benefits. An HRIS, in other words, moves all paperwork to computers, greatly simplifying the work of HR teams.

What is an HRMS?

HRMS is the next big thing. It is a bit more advanced than HRIS. HRMS is a record-keeping system that does much more than an HRIS. HRMS handles all employee issues and processes from obtaining applications from candidates to their departure from the company.

An HRMS can support recruiting, training and goal-setting. It also supports performance evaluation, salary increases or promotions. Imagine this as an HRIS with tons of extra tools to make HR operations more efficient and faster. This is a good option for HR teams that want to save time.

What is an HCM?

HCM, or Human Capital Management, is the focus of attention. It is the most recent and advanced of all three. HCM is more ambitious than HRIS or HRMS, which are focused on managing daily tasks and keeping records. HCM is not only about being organized, but also about using the skills of your employees in a more strategic way to benefit the entire company. Overall! Of course!

HCM offers all of the features offered by HRIS and HRMS, but it also adds value to the planning for future hiring, employee career development, and data-driven decisions. Some HCM systems are so advanced that they use AI to assist with candidate sourcing, or make training programs super simple and specific. It allows employers to treat their employees as assets instead of just resources.

What are the main differences between HRMS and HCM?

How they deal with data

As we would say, all three systems store employee data digitally but they do so in different ways. HRIS, being the most basic system, only stores names, job titles and salaries. Imagine these as a digital filing system that is completely organized. HRMS manages much more than data. It also includes tools for recruitment and performance reviews. HCM analyzes this data to help companies make larger decisions such as when new hires or promotions are made.

What tasks do they help with ?

HRISs can be used to do basic tasks by HR teams, such as processing payrolls, tracking leave taken, and administering benefits. The HRMS is better suited for organizations that need more advanced features, such as recruiting new employees, setting up performance goals or training them. HCM is a step above the rest (once more, of course!) HCM focuses on long-term plans, skills that the company will need next year and ways to keep employees motivated and productive.

What is their main goal?

The HRIS ensures that all records are accurate and safe. The HRIS is designed to keep everything organized. HRMSs are designed to streamline HR tasks, making them easier for employees to perform. This is especially important as companies grow. This is more about automating and saving time. HCM is distinct in that it does not refer to HR. HCM is about investing in the people of an organization to help it grow.

What kind of business needs them?

An HRIS can be a good fit for a small business that has simple HR requirements. An HRMS is the best option for a mid-sized business that wants to grow and hire more employees or manage performance. HCM is the best option for large companies that are globally spread or have big growth plans.

Reports and Analytics

These systems are able to deliver useful and meaningful information through reports. HRIS systems produce basic reports such as the number of vacation days taken by an employee. A HRMS can create custom reports based upon hiring trends or employee performances. HCM uses the latest technologies, including AI, to determine which employees will leave sooner and which training programs perform best.

Conclusion

It’s done. You should no longer be confused by the meaning of these terms, their purpose, or why they are used. This post on the differences between HRMS and HRIS as well as HCM should have made your head a lot clearer.