What to look for in a Human Resource Management Software

As the business grows, human resource becomes a crucial department in the business. In your marketing mix, the ‘people’ play a big role in ensuring the success of a business.

Many software companies offer different HRM packages in the market and often it is difficult to choose one over the other. Using our experience both as a Software Development Shop and Human Resource expertise, we’ve put together few tips to help you choose the best software package for your needs.


When evaluating a human resource software package, make sure the system offers the features you are looking for and actually need. There are many software packages in the market and some cater to specific markets. If you are a small or growing business, you may not need all the bells and whistles that a package might offer. More bells and whistles generally means more cost. Carefully evaluate the features that you need and the associated cost. For example, most businesses large or small need features such as…

Time and Vacation Tracking

Performance and Goals Management

Compensation Management

Learning / Employee Growth

But small and growing businesses may not need features such as Asset Management etc.

Remember, more features means more cost and complexity.

Ease of Use

The software should be easy to use and should have an extensive help guide. It is normal to have a learning curve with any new package, but different packages have different learning curves and setup times. Some even require an expert to configure and customize the system before you can use. Bottom line – you need a system that is easy to use, intuitive, easy to setup and has extensive help available.


In this day and age, security is of paramount importance. While cloud based solutions are great for anywhere availability they need to be properly secured. When evaluating an online subscription based solution (often known as SaaS = Software as a Service) you need to ensure the software is secure. For starters, it should use SSL encryption, have the controls in place to ensure physical security, should require users to pick strong passwords and require them to periodically change their passwords. Finally, it should also have audit and logging feature to ensure who is accessing the system.


The Human Resource Management software should also have a set of reports that you can run on a daily basis or for a period of time to provide you the information that you are looking for. Be it – vacation hours for one or more employees, or time / attendance records, performance appraisals etc. The HR package should also allow you to print or download the report so you can use it offline.


It goes without saying that the system which you depend on every day to run your business activities should also be reliable. While every software vendor faces downtime every now and then, ensure all scheduled updates are done during off hours to minimize the impact to your business. Ask your vendor whether they have a proper testing procedures in place and how do they ensure that the software is free of major bugs.

Licensing Agreements

Finally, when evaluating an HR software package, you need to understand the licensing requirements that you will have to adhere to and your vendor will adhere to. Vendors are all over the board when it comes to licensing requirements. So require you to sign up to a year agreement and pay in advance, others don’t have any subscription requirements and you pay on a monthly basis. Some require you to pay a fixed charge per month, while others make you pay on a per user basis. Whatever you choose, make sure you understand it before signing on the dotted line. Most small vendors are willing to work with you to accommodate their fee structure. It is important, especially in the first few months that you have an exit clause without having to pay fines / penalties.

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