Human Resources Software: Factors That Make It Pay Off
Human resource software can reduce staff turnover, enhance transparency in a company’s operations and employee performance, and decrease recurring education and software expenses — these benefits only amplify as your company grows in size.
It’s no surprise then, that over 95% of employers plan to increase their investment in recruiting technology: HR software can streamline information gathering for human resource professionals and boost the efficiency of their internal business processes.
Here at Surf, our 12+ years of experience in crafting web and mobile apps, including HR software for top global companies, has given us valuable insights. We’ve learned the ins and outs of designing software that truly helps both the company and its employees.
In this article, we explore the growing market of human resource software and its benefits for businesses and employees. We’ll cover various types of HR software, discuss custom vs. out-of-the-box solutions and how to choose the right tech stack, and highlight essential features to consider when choosing or developing HR management software.
State of the human resource software market
The human resource software market is booming. As the pandemic prompted a quick change in work models, HR teams and departments have been inspired to adopt inventive strategies for addressing employee and workforce needs. This adaptability has contributed to a steady market growth, with a compound annual growth rate (CAGR) of 7.5% year over year.
Benefits of human resource software for users and businesses
Given how many benefits HR software brings to both companies and employees, the market growth we’ve highlighted in the previous section is easily explained. Here are some of the main advantages.
Why companies should consider using HR software
Companies can harness HR software to refine various facets of their human resource management. Ultimately it enhances staff productivity through:
- Better staff training and development. HR software enables remote corporate training without sacrificing quality, helping companies to increase staff qualifications and slash educational budgets.
- Simplified employee evaluation and talent search. HR software allows companies to collect extensive information about employees, assisting managers in better understanding their needs, abilities, and potential. This data-driven method can lead to improved personnel decisions, boosting efficiency and performance.
- Boosted team effectiveness. By relying on data about each employee and considering their strengths, HR solutions can help improve employee engagement and create high-performing teams.
- Reduced staff turnover. HR software can help companies detect employee burnout by monitoring factors such as long-term employment in a single position without salary increases or career growth. In our experience, this can result in proactive measures and help reduce turnover to just 5%.
Benefits for employees
HR software can support teams and team leaders in staying aligned regarding career development, offer training, streamline onboarding, and more:
- Additional career path clarity. HR software can guide employees in pinpointing the skills they need to cultivate to reach their career aspirations, offering tailored training suggestions, checklists and clear-cut goals.
- Better communication opportunities. An in-house HR solution can integrate a corporate chat and newsfeed, helping employees stay connected with colleagues and informed about the latest news in the company. This can nurture a sense of teamwork and enhance overall team performance.
- Opportunities for self-assessment and alignment with management. HR software empowers employees to seek feedback from peers and managers, as well as share their thoughts on company events and innovations. A personal page within the HR application lets employees highlight their successes and achievements, fueling motivation and boosting efficiency.
- Efficient training. HR apps empower employees to access customized courses, exams, and a variety of corporate training resources, including quizzes, videos, and tutorials. By facilitating growth and alleviating the stress that may accumulate from continuous training and performance review cycles, these apps contribute to a more positive and productive work environment.
- Improved employee engagement. An HR app can include features that allow employees to recognize and reward their colleagues for outstanding achievements — like a digital wall of fame. This feature fosters a culture of appreciation and acknowledgement, which can help boost morale, motivation, and overall job satisfaction.
In KFC ERP, digital employee data aids managers in devising efficient work schedules.
Boosting employee experience with HR software: Surf’s insights
Let’s delve into how a thoughtfully implemented digital HR solution can revolutionize the employee experience and contribute to business growth, using a real-life case study as our guide.
We were approached by one of the largest manufacturers in the world with a request to streamline training for their 10,000 employees. The client’s objective was to engage all employees in the company’s digital transformation, tapping into their combined knowledge and creative input.
To realize this vision, we developed a high performance backend using Kotlin, implementing a microservice architecture with tools such as Spring Boot and JWT token for authentication.
On the frontend, we concentrated on designing a simple yet informative UI, ensuring the app was user-friendly for all skill levels — and the client approved our layouts from the first iteration.
In terms of technology, we utilized Flutter — a cutting-edge frontend development framework. Leveraging the cross-platform technology allowed us to deploy to both Android and iOS from a single codebase. Thanks to Flutter, we managed to save about 30% of the budget compared to the costs of native development.
Types of human resource software
Training automation is just one facet addressed by HR software. There are numerous other types of these applications designed to streamline various aspects of human resource management. Here are some of the most commonly used ones:
- HumanResource Information Systems (HRIS) or HumanResource Management Systems (HRMS) are central databases for managing employee data, benefits, and payroll. Implementing an HRIS/HRMS can lead to cost savings, increased efficiency, and improved compliance with labor regulations. Standout example: BambooHR.
- Applicant Tracking Systems (ATS) streamline the recruitment process, from job postings to candidate selection. They help businesses speed-up hiring by automating tasks like resume parsing, interview scheduling, and candidate communication. This enables businesses to secure top talent quickly and stay ahead of competitors. Standout example: Greenhouse.
- Performance Management Software helps organizations track employee performance, set goals, and conduct evaluations. By providing a centralized platform for monitoring progress and giving feedback, businesses can identify areas for improvement and align employee objectives with company goals. Standout example: 15Five.
- Payroll and Time Management Software: streamlines payroll and attendance tracking. These tools can reduce payroll errors and decrease labor costs through more accurate timekeeping. Standout examples: Gusto (payroll) and TimeClock Plus (time and attendance).
These tools excel at automating individual or multiple processes within your HR department. However, for a more holistic approach, you might want to consider an Enterprise Resource Planning (ERP) system.
ERP systems provide all-in-one solutions to break down data silos, enhance efficiency, and deliver cost savings through the seamless integration of HR tools. These systems allow enterprises to plan resources effectively, combining accounting, HR, and communication software into a single, cohesive solution.
Take KFC’s experience, for example. They sought to transition from outdated paper-based processes in their restaurants and approached us to create a custom ERP system.
We incorporated features like automated scheduling, facial recognition-based time clocks, and dashboards displaying crucial restaurant performance metrics. Digitizing this information — and storing it on their servers, where it was readily available — allowed managers to plan more effectively, ultimately saving KFC an average of 10 hours per week.
Custom vs out-of-the box HR software
The market is brimming with quality services offering ready-made HR automation on a subscription basis. The ones mentioned earlier are just a few highlights. Other noteworthy options include:
The adoption of HR software services is also on the rise. For instance, a study found that in 2021, 46% of companies used an HR Software-as-a-Service (SaaS) platform or hybrid solution, a significant increase from the 20% adoption rate just two years prior. However, in some cases, opting for a custom solution might be a better fit.
When considering whether to opt for custom or out-of-the-box HR software, take into account factors such as:
- Company size
- Budget constraints
- Required features
- Integration capabilities
- Data security
- Privacy concerns
- And long-term scalability.
Typically, larger organizations with complex needs and a focus on scalability might prefer custom solutions, while smaller businesses with limited budgets could find out-of-the-box options more suitable.
Custom software allows for greater control over sensitive data and tailored features, but it requires a higher initial investment in terms of both money and time.
On the other hand, out-of-the-box solutions are easier to set up and have a lower initial cost, but they may offer limited customization and integration options.
3 impactful human resource management software features
A significant advantage of developing your own software is the ability to select features that best align with your business objectives and internal processes, such as:
1. An integrated chat can seamlessly exchange data with other HR services, promote communication, and save an average of $10-15 per employee. For a company with 1,000 employees, the initial investment will pay off in just three months.
2. A loyalty system can incorporate gamified mechanics to further motivate employees, while monitoring their performance to assist managers in objectively allocating bonuses. According to case studies we’ve conducted with our clients, implementing such a system can help reduce turnover to just 5%.
3. An education center can expedite the onboarding process for new hires and assist existing employees in enhancing their qualifications through digital training, while boosting their engagement through gamification. For a company, this approach can help keep education costs down by 30% in our experience.
Choosing the right tech stack for your HR software
To develop these and other essential HR software features, it’s important to narrow down the right tech-stack. It’s generally wise to opt for popular technologies among developers and steer clear of less common solutions when possible.
Innovative technologies such as SwiftUI for frontend or Rust for backend can address some engineering challenges. However, locating developers experienced in these tools can be difficult, and they often command higher salaries.
At Surf, we frequently utilize Golang, Python, and Java for backend development, along with Flutter for frontend development. By employing a cross-platform framework like Flutter reduces project budgets by approximately 40% compared to a native approach.
This ensures we deliver high-quality HR software solutions while optimizing development costs.
If you’re looking for a tailored HR solution that meets your unique business needs, Surf can help.
With our extensive experience in building web and mobile applications, including HR software for top global companies, we’re equipped to create a custom solution that aligns with your organization’s objectives and requirements.