business.com receives compensation from some of the companies listed on this page. Advertising Disclosure
Home

4 Questions for a Successful HRIS Audit

Chad Brooks
Chad Brooks
Editor
business.com Staff
Updated Jan 23, 2023

When evaluating a human resources information system or auditing your current one, keep these four things in mind.

Your human resources department is responsible for a large amount of employee data; managing this information and turning big data into something useful can be difficult to do manually. However, what was once a time-consuming and overwhelming process can now be simplified, streamlined and automated with the right software and systems in place. In fact, regardless of whether you’re running a new or established business, there’s a good chance that a human resources information system (HRIS) can help you out.

If you’re a first-time HRIS buyer, you’ll want to carefully assess the options on the market to find the right solution for your business – but it doesn’t stop there. As technology changes and your business evolves, you’ll want to conduct regular audits on your HRIS system to ensure it’s meeting your current needs.

What is a human resources information system?

An HRIS is an integrated platform used to gather, store and analyze information about an organization’s human resources. It serves as a central hub for employee information and aids in common HR functions like: recruitment; applicant tracking; benefits administration; compensation management; employee training and development; absence management; administrative HR services; and HR workflows and workforce reporting. While one specific HRIS may meet your HR needs, some organizations find themselves using multiple HR platforms that integrate seamlessly (e.g., an applicant tracking system and performance management software).

An HRIS can be a powerful tool for workforce management and help companies streamline and automate many business processes related to human resources. Automation tools included in HRIS platforms can be especially helpful for reducing the potential for human error as well.

What are the types of HRIS platforms to consider?

There are many types of HRIS platforms, including the four outlined below.

  • Operational HRIS: This system is designed to provide managers with the data required to support routine and repetitive human resources decisions. They often include information about a company’s employees, employee positions and government regulations. An operational HRIS comprises various subdivisions: employee information systems, position control systems and performance management information systems.
  • Tactical HRIS: This type gives managers support for emphasizing resource allocation. These may include assistance with recruitment, training and development, design decisions and job analysis. There are a few subparts in a tactical HRIS, including job analysis and design information systems, compensation and benefits information systems, employee training and development systems and recruiting information systems.
  • Strategic HRIS: This kind focuses on supporting workforce planning, labor negotiations and certain specialized human resources software. The major types of strategic HRIS have subparts that consist of information systems supporting workforce planning and specialized human resource information systems software.
  • Comprehensive HRIS: This is an integrated database of human resources files, employee position files, affirmative action files, employee files, skill inventory files and a range of other HR files designed to produce reports for management.

The wide range of HRIS types can make it tricky to know which system (or combination of systems) is right for you. As such, you’ll likely want to conduct a recurring audit on the HRIS you  choose to ensure it continues meeting all of your needs. If it’s not, it might be time to evaluate new HRIS solutions to replace or supplement your system.

FYIFYI: To learn more about managing human resources with software, check out our guide to the different types of HR management software.

4 questions to ask yourself when auditing an HRIS system

When evaluating an HRIS for purchase or auditing your current system, there are two primary objectives you’ll want to keep in mind: information and security. To assess these components during an HRIS audit, ask yourself these four questions.

1. Does the HRIS support achieving your company’s HR objectives?

To determine whether your HRIS is meeting HR objectives, evaluate whether the technology provided by your system supports your goals and streamlines your operations. Objectives often include training and employee development, benefits administration or self-service and payroll and benefits administration. Does your HRIS help facilitate these things? It should.

2. Does the information available from the HRIS meet the needs of your human resources team?

If your HR team spends 25 percent of its time on record-keeping and auditing, your HRIS isn’t doing its job and is costing your business in terms of employee productivity. The information provided by your HRIS should reduce the time it takes to complete HR processes. The system should allow for easy report creation and management, data-driven decision-making and employee performance tracking. If the HRIS you’re evaluating or auditing doesn’t cover these bases, a change needs to be made.

Did you know?Did you know? An HRIS can automate several HR functions for you, and businesses are quickly realizing the value of this. According to SHRM, 1 in 4 companies now use automation and artificial intelligence for human resources tasks.

3. Is the data in the HRIS confidential and secure?

Human resources departments are responsible for a large amount of confidential data: employee Social Security numbers, bank account numbers for direct deposits, benefits administration details and so on. Your HRIS must protect this information, from the time it’s entered into the system to what would happen should a breach occur. Clear documentation is necessary, and protocols, policies and controls should be built into your HRIS so that only those who need access to sensitive information can get it. Your HRIS should minimize potential data loss and protect confidential information.

4. Is the data that flows into and out of other systems reliable and secure?

If you have seamless system integration with confidential information protection throughout, your human resources data flow is on the right track in terms of security and reliability. From policies to protocols for data management, a robust HRIS should allow your business to integrate multiple software solutions as needed without the risk of data loss or information vulnerability. Another element to check is whether the data coming in and out of your HRIS flows together so you can create accurate reports and make more decisions with the information available.

As you audit an HRIS, make sure you have policies and processes that allow for effective identification, communication, capture and validation of human resources data. Focus on the aspects highlighted above to determine whether or not the solution you’re considering or evaluating meets your needs.

Skye Schooley contributed to the writing and reporting in this article.

Image Credit: apichon_tee / Getty Images
Chad Brooks
Chad Brooks
business.com Staff
business.comb.
Chad Brooks is a writer and editor with more than 20 years of media of experience. He has been with Business News Daily and business.com for the past decade, having written and edited content focused specifically on small businesses and entrepreneurship. Chad spearheads coverage of small business communication services, including business phone systems, video conferencing services and conference call solutions. His work has appeared on The Huffington Post, CNBC.com, FoxBusiness.com, Live Science, IT Tech News Daily, Tech News Daily, Security News Daily and Laptop Mag. Chad's first book, How to Start a Home-Based App Development Business, was published in 2014.