Benefits of Using HR Software

HR software is a cloud-based and automated online system to manage the human resources of the company. The Benefits of Using HR Software are massive starting from recruitment, onboarding, and hiring to payroll management, employee engagement, and final offboarding. HR software plays a vital role in the success of modern HR businesses.

Businesses have significantly saved their money by cutting paper costs and digitalizing every HR-related day-to-day operation. They have become smarter, more productive, and more efficient. Another crucial role is that organizations have ample free time to focus on strategic, macro-level key business areas that have improved decision-making.

On the one hand, large enterprises with big employee sizes can upgrade their existing systems to better HR software features. On the other hand, HR software has huge importance for startups and small businesses. They can adopt the concept of HR software to simplify, streamline, and automate mundane & time-eating HR operations.

As a startup, the major focus should be on employee satisfaction, better policy designing, and overall company growth rather than wasting time manually on basic HR tasks. With the help of meaningful insights into HR trends and metrics, SMEs can take their business to new heights in a few months.

According to Verified Market Research, the HR software market will grow by 10% CAGR in upcoming years. In this blog, we will discuss the Benefits of Using HR Software in detail.

10 Key Benefits of Using HR Software

Here are the top benefits of HR Software:

1. Automate HR Processes

According to McKinsey, 50% of HR operations can be automated to make the process faster, and more efficient. One of the major Benefits of Using HR Software is that it automates monotonous day-to-day HR operations, e.g., payroll, attendance tracking, salary, etc. It is the best time-saving and cost-effective solution for startups and large enterprises as they don’t need to handle complex HR tasks manually via paperwork and Excel sheets.

Everything related to an employee, such as tax, benefits, salary, feedback, leaves, working hours, attendance, etc is stored in a central automated system & is accessible from there. According to SHRM, 69% of the organizations that adopted the automated HR software system noticed massive time savings in the whole employee hiring process.

2. Cost Savings

Cost savings is one of the great advantages of human resource management software. Companies always look out for alternatives to cut down on additional or irrelevant costs & bringing HR software into your company is the best way to accomplish this. The HR software digitalizes the complete HR tasks reducing the need for manual data entry operation.

This way there is negligible need for paper-based processes, therefore companies can save money on paper. Moreover, HRM software saves money by eliminating the need to hire & pay salaries to HR professionals for time-consuming tasks. Such tasks are manually handling monthly payroll, tracking attendance, and managing leaves.

According to SHRM, HR software has led to massive cost savings as the cost of purchasing the HR software is comparatively lesser than the salary of an HR admin. HR software cost would be between $1 to $5 per employee per month which is less than an HR professional’s monthly salary.

3. Data Management

Data is the biggest resource for every company, especially employee data. Such data plays a big role in deciding the future of an organization where it can grow or go in loss. Raw data needs to be properly utilized to get quality applicants, understand future risks, and take necessary measures. Tracking the employee data manually is difficult, time-consuming & is prone to human-made errors.

Moreover, it increases the chances of data duplication, underutilized data, data changes, outdated data, incomplete data, etc. Such careless data handling leads to disputes, dissatisfaction, and compromised productivity. One of the biggest Benefits of Using HR Software is effective data management that solves all the manual data handling issues.

With the help of HR software, all the data related to an employee can be stored, updated, and retrieved online. Such data includes the employee’s job history, banking, leave request, insurance, personal information, salary, tax, etc.

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4. Employee Self-Service

Employees had to interact with the HR team to update their personal information, and to get answers on basic terms & conditions of the company. Every single HR operation previously was paper-based which created communication barriers within teams & increased the waiting period for approvals & modifications.

It put an extra burden on HR professionals and caused delays by answering one-on-one to every employee. The solution to this is the Employee Self-Service feature of the HR software, where employees get access to the HR relevant data such as reimbursement details, benefits information, upcoming events, etc through a web portal or the company’s intranet.

With the help of HR software, employees can view their offer letter-related data & make changes to their personal information, such as bank details, address, phone number, etc all by themselves. Furthermore, HR professionals can use this saved time to focus on strategic issues, complex tasks & key business areas.

5. Recruitment and Onboarding

One of the undeniable Benefits of HRM is how effortlessly it manages the employee lifecycle from recruitment and onboarding to full and final settlements. It has an applicant tracking system and offers seamless integration with existing tools. Such HRM software comprises advanced-level automated features that streamline and simplify the entire recruitment and hiring process.

For example, the HR software will design a job description, post job openings on varied job portals on your behalf, filter out all the eligible candidates by accepting or rejecting the profiles based on pre-set criteria, and automatically schedule the job interview sessions till the final hiring steps. This way you can hire the most suitable candidate for a job role.

6. Performance Management

The Importance of HR software is immense and has allowed the HR team to manage the performance of every employee digitally. Imagine a situation where the performance of an employee isn’t tracked on time. It will create huge confusion while providing salary increments, incentives, promotions, etc. Employees can also use it to their benefit by making false claims to get increments.

Moreover, their overall growth will be hampered due to no improvement in the current performance, leading to a decline in company growth. Due to this HRM platform, HR professionals can set performance goals, smoothly assess the skills of an individual employee, and track improvement areas. Moreover, the system allows us to take feedback about each other employee, dig into the loopholes in their performances & suggest what relevant skills can fill those gaps.

The overall aim of a performance management feature of HRM software is to consistently address job expectations, performance gaps, and strategic plans to optimize individual performances.

7. Benefits for Admin

Admins are the first ones to be knocked at whenever employees face minor issues. They had to enter manually and process data for every employee one by one. Moreover, there are a lot of time-consuming and repetitive HR tasks that require an immediate solution. Some of these tasks are salary disbursement, checking attendance records, new employee enrollment, liaising with suppliers, etc.

According to Frevvo, more than 73% of time is consumed in performing monotonous administration tasks. With the help of internal HR software, administrative work gets easier, more efficient, and faster, and saves a huge amount of time for the HR team.

It creates, updates, and changes the benefits of employees online so that employees don’t have to communicate with administrators for information. The software stores all the HR-related information in its platform, which is simplified, organized, and easy to retrieve whenever required.

8. Compliance and Reporting

The non-compliance acts associated with mandatory laws, rules & regulations cause serious repercussions to the company. In severe cases, the business might completely shut down, the employee turnover rate would increase, and the cost to the company would multiply.

The only solution to deal with such unseen faults is by adopting an HR system in your organization that will monitor the internal systems adequately. HRM software is generally ISO-certified, which ensures the safe storage of confidential employee data.

Moreover, it generates & sends reports that comply with the pre-set regulations such as EEOC, GDPR, etc. With the help of HR software, you can automatically track all the legislative updates, compliance with the industry standard, and changing labor laws. Therefore, there is no risk of unwanted penalties or litigation cases.

9. Employee Engagement

Employee engagement explains the overall dedication of employees towards their job role. Without this dedication, the productivity of employees is severely affected, increasing the rate of dissatisfaction and employee turnover. Employee engagement is critical for the overall success of an organization as it boosts employee morale to perform better than yesterday.

Companies working on a manual mode of handling HR operations find it difficult to retain employees for the long term due to the absence of HR software systems in the workplace. HRM software has an employee engagement feature that recognizes employee achievements and provides regular feedback to improve the areas where they are lacking.

This keeps employees engaged and dedicated to their work. The more engaged employees are within the company, the more motivated & satisfied they will feel, leading to higher performance and productivity. It creates a positive working environment, leading to minimal absenteeism and better retention.

10. Analytics and Reporting

The HR software is a prominent tool to convert raw data into actionable insights and generate automated reports on employee lifecycle using advanced-level analytical methods. Some such methods as Natural Language Processing (NLP), Deep Learning (Dl), Artificial Intelligence (AI), Machine Learning (ML), etc. ‘AI is the future,’ and none of us can deny it.

Implementing the latest AI tools will make your team efficient, smart, and productive. The HR software generates comprehensive dashboards & reports on different HR metrics, that allow strategic planning for human resource management & data-driven decision-making.

Due to this analytical analysis, HR managers assess training requirements, recognize ongoing trends, forecast recruitment needs, predict turnover rate, and identify leadership candidates. Moreover, with the help of such analytical tools, your company will always stay ahead of its competitors.


HR software is the digital solution to manual HR problems. It has greatly optimized everyday human resource (HR) operations, bringing in cost-effective solutions, efficient employee data handling, and high-end productivity. There are several Benefits of Using HR Software, such as employee engagement, automation, employee self-service, onboarding, analytics & reports, etc.

All such benefits improve the overall HR performance and productivity in compliance with labor law. Moreover, there will be better human resource management leading to employee motivation, higher retention rates, and 100% satisfaction. Now, the question arises of finding the right HR software vendor that meets your personalized HR software needs.

StartupHR Software is the answer to this question as we suggest the most suitable custom-made HRM software that suits your HR requirements. You also get a free demo session beforehand to get familiar with the systems & their benefits for your business growth.

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