If you are looking at automating your HR tasks, you may have heard of a number of terms like HRIS, HRMS and HCM. Are they all different from each other? Do they do different things and is it important for you to know the differences? What are these different acronyms and what do they really stand for? In simple terms, when it comes to using or creating these software programs, there isn't much difference between the three.
All the three are software suites that come with databases and enable you to automate HR related tasks. They may or may not be cloud-enabled. They seek to manage all aspects of an organization's workforce. In this article, let us take a look at how different these software programs are; or if they are really different from each other at all.
HRMS – Human Resource Management Systems
The better known acronym of the three, HRMS is usually viewed as more comprehensive than either HCM or HRIS. Today, most companies with a sizeable number of employees use one or the other form of an HRMS.
An HRMS reduces the number of manual tasks and automates HR processes. This brings about efficiency within the organizational system and enhances productivity. HRMS implementation is usually recommended when there are a good number of employees and managing them causes undue pressure on a company’s resources.
HCM – Human Capital Management
HCM or Human Capital Management is another name given to HRMS or HRIS. There really isn't much difference, at least from the perspective of the author of the software. However, we must bear in mind that HCM also refers to the management of HR activities.
It does not necessarily refer to a particular software or information system. HCM is an acronym often used to describe the process of workforce management by keeping in mind that employees are a company asset. It is almost like the acronym HRM, which is widely used across the world.
HRIS – Human Resources Information Systems
HRIS was originally a software program that connected databases related to human resource departments. Though an older version and an older name, HRIS is almost the same as an HRMS. HRIS is also assumed to be the more technical version of an HRMS. However, this assumption is usually wrong. HRIS and HRMS, as of today, can be used interchangeably. Some vendors like to market their HRM software as HRMS and other, as an HRIS. It really depends on the cultural context in which the software is being marketed.
Does this mean that we can use all the terms interchangeably?
This is true to an extent, depending on whom you are speaking to. Like described above, all the three acronyms could refer to a set of software programs that help companies to manage their employees better by automating certain aspects of HR.
However, in some cultures and in certain countries, HRMS is more preferred over the term HRIS. Moreover, HCM can refer to the management of human capital, without making any reference to a particular software program. Thus, we can say that all the three terms can be used interchangeably but we must also have it in the back of our minds that terms like HCM can have a different meaning altogether.
As long as you know that you are referring to a comprehensive software suite that helps you to automate HR processes, you can use any word you want. However, the terms HRMS and HRIS are more easily recognizable. Of these two, HRMS is beginning to be increasingly used in corporate and marketing circles.