There are thousands of different HR tools and software packages with each their own field-of-application. Many people have tried to structure these packages according to different archetypes, with a lot of confusion and acronyms as a result. We'll explain the most commonly used terms and set you on the path to make the right HR software choice.
When first interacting with the HR software world, you'll soon realize there are a whole host of acronyms being used to indicate a certain type of HR system. Even between HR professionals, influencers en software providers themselves, there isn't much unity concerning what these terms mean and there is a lot of discussion surrounding which HR tool falls into which category. We went out and checked the opinions of multiple HR influencers, HR service and software providers to draw a general conclusion of what these terms mean. So what does HRIS, HCM, HRMS, TMS, ATS en LMS actually mean and what do I need these systems for?
Let's start with the most general term for a HR software package: an HRIS, which stands for Human Resource Information System. This is the most commonly used term to describe an HR system which retains and manages data around employees. This kind of software works primarily to support many different functions within the HR department. However this system affects processes, people and common rules throughout the entire organization. These systems offer functionality surrounding the following processes:
- Core HR *
- Absence management
- Payroll (compensation & benefits)
- Training & development
- Routine HR workflows
- Reporting / Analytics
* Core HR: This domain covers all processes and systems which are minimally required to have if you want to employ personnel. Storing employee data, paying of wages and retaining income tax and social securities are all part of core HR.
At this time, Officient can be best described as a HRIS. Our product offers functionality for almost all above mentioned processes, with the exception of recruiting and training & development. We do however go further than a traditional HRIS. We offer support to integrate an international workforce and also supply entry models for performance reviewing.
A HCM is the expanded version of a HRIS and stands for Human Capital Management (system). Generally speaking a HCM package should contain most of the previously mentioned functionality, but should also offer support for managing talent throughout their journey at your company. In the following segment we'll go deeper into Talent Management (systems) and how as a discipline it differs from traditional HR functions. On top of that, a HCM package will most likely be used by larger and/ or international organizations. This comes from the fact that these systems should consist of functionality to support multiple languages and have localization built in towards different countries and currencies. Subsequently we can categorize a HCM as a HRIS, complimented with one or more of the following functionalities.
- Performance & goal management
- Succession planning
- Global integration
- Extensive HR analytics & KPI monitoring
Officient isn't a full-blown HCM yet, but even thn we already go further than what a traditional HRIS system would offer. Through our unique integrations we help Belgian and Dutch companies support an international workforce. On the other hand we can help international companies integrate Belgian payroll workers. We don't offer extensive functionality for talent management yet, but we're already building entry models for performance reviewing and KPI monitoring for employees.
We mentioned earlier that a HCM package, is an extended version of a HRIS. With some added capabilities for talent management and better support for a global workforce. In some HRIS cases there might be functionality for courses and education, or workflows to manage coaching. However talent management goes a lot further than just having a performance review now and then and offering a folder of courses to your employees. True talent management has its effect on multiple domains and departments within the company and is often a strategic exercise which has to be made with the entire company. This means for one a complete overhaul of your recruiting strategy & tactics, but also designing flows around following upon individuals, related to their role and identity.
This means that TMS or Talent Management Systems are software systems which have as primary focus: attracting top talents, developing and nurturing them through their employee lifecycle and maximizing retention as a result. These systems often have to communicate with other HR tools or a HRIS to exchange to necessary information about employees ( f.e. targets and their completion might be captured in larger systems). That's why when supporting an international workforce, you need to be able to integrate the talent management tool with the global data in a HRIS. The need for the combination of these two means you'll have to start searching a HCM system.
Human Resource Management Systems is the overruling group of select HR software providers which offer a broad spectrum of functionality for managing a large and international workforce. These systems are often a combination of a standard package, but with the possibility adding optional modules. This allows for designing the systems around your organization and its needs. This type of software often comes with extra services added in such as a dedicated account manager. You will aso be able to recruit consultants or product experts to maximize the gain your company can get from the software.
Not all previously mentioned functionality has to necessarily be a parts of the HRMS. For example Talent management or learning systems could be smaller and independent software tools, but should have to possibility to communicate with the main HRMS. Critical is that the HRMS offers support for a global workforce, with a combination of well designed payroll and time & attendance systems for multiple countries. Well-known systems like SAP Succesfactors and Workday are part of this type of HR systems.
ATS or Applicant Tracking Software, is the group of HR software tools which helps your company attract and recruit potential candidates. This type of software often has integrations with different job boards (Indeed, Linkedin..) to push the job openings and can often generate a unique page or environment for your company to house all their vacancies. The software will most likely support a candidate pipeline you can configure around your recruiting process, where candidates have to go through different stages and/or perform different tests. Often these pipelines can be defined per role or categorized around functional requirements. An ATS could be an independent software tool (Recruitee) or could be integrated as part of a larger HRIS, HCM or HRMS package. Some HR-tools have a more narrow focus and support certain parts which are part of the recruiting process, f.e. Talmundo is a product which will help you succesfully onboard new employees.
LMS stands for Learning Management System and is the category of HR software which supports different kinds of courses, education and customizable learning tracks. On one hand there are tools which help employees follow courses or learn different skills. On the other hand there are also systems which are built to test knowledge or emplot games and puzzles to get employees acquainted to the company or a certain workflow. Often times these software systems employ gamification (Introducing game like components into regular software to encourage completion by earning points or winning awards). This is mostly used to follow-up on goals or KPI's around different roles and the possibility of defining learning workflows around different roles or functional requirements. Our good friends at Intuo.io offer a LMS product which boasts functions s.a. learning management, 360° feedback, engagement surveys & more.