Role of HRIS systems in decision making

HRIS systems allow you to analyze your HR data in such a way that you can be responsive to market realities and turn your insights into a demonstrable business growth. With lower HR costs and overall HR productivity improvements HRIS systems help in business management and help outperform the competition.

Initially, HRIS systems were only used as an information resource that allowed data input and storage capabilities. However, in the past decade, the focus of HRIS has shifted from an information system to a fully operative decision-analysis tool.

How HRIS systems help in decision making

HRIS has evolved from the Office Automation System tool of 1980s to a modern tool that includes the features of transaction processing system, decision support system, and communication system. In addition, the new generation features of HRIS system such as Employee Self Services (ESS) and Manager Services have provided the ability to employees and their managers to complete the HR-related transactions without the intervention of HR. This has significantly reduced the administrative burden from the HR and has helped HR function to align itself with the company’s core business strategy as a true business partner.

HRIS systems help organizations in decision making and HR planning in following ways:

• Availability of Information on wide range of data: Today companies have started integrating HRIS system to other HR systems, such as payroll, leave, travel and expense, time and attendance, career planning, and skills inventory to store, retrieve, update, classify, and analyze data easily. The integration of data with other systems has enabled HRIS to provide detailed information on mostly all HR systems. With improved access to metrics, faster information processing, and greater information accuracy the fast decision making and better HR planning is made possible for decision makers.
  
• Human resource analysis: HRIS system allows human resource analysis, which is the basis of HR planning and most business decisions making. The organizations make many business decisions on the basis of the capabilities of their employees and many decisions to make their workforce happy and skillful. To improve their HR resource, company’s management can design effective programs to improve employees’ and company’s performance and build a happy workforce.
  
• Quick reports and dashboards: HRIS offers ability to quickly run reports and view dashboards, which allows the CEO and management of the company to take important decisions concerning employees and the areas that affect company’s business as a whole. For example, HRIS dashboards and reports can show real-time data and provide quick information on return of investments made on human capital and trainings provided to employees. They help you find out the cost per hire, the cost of healthcare benefit on each employee, and the pay benefits as a percentage of operating expense. This can be further drilled down to locations, business units, functions and departments in a variety of ways.
  
• Forecasting and Planning: The input of HR analysis can be transformed into predictive feedback about organizational future needs. HRIS can be used to forecast future workforce demand to initiate recruitments for vacant positions to maintain a high service, forecast turnover in service delivery positions, and understand requirement to conduct trainings to manage succession planning and to build a skilled workforce, in advance.

The HRIS functions can be made to comply with organization’s policy to help the organization manage its human capital on the basis of the organizational vision.

Thus, the new advancements in HRIS systems have helped the top management of companies to gain greater visibility into human capital for better decision making.