Advantages and Disadvantages of an HR Suite vs Stand-alone HR Software

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After researching various HR software solutions, you’ve likely come across terms like HRIS, also called “stand-alone,” software, and HR suites also called an HRMS. As confusing as that is, most of the functions present in an HRIS are also found in an HRMS.

In this article, we’re going to describe the difference between an HRIS and an HRMS, why they each have several nicknames, and how each software solution could benefit your company.

What is a stand-alone HR system (HRIS)?

A stand-alone HR system or HRIS (Human Resource Information System) is the smallest bundle of HR software. HRIS platforms are designed to get businesses up and running quickly while providing the essential HR applications, systems, and functionality companies require.

The term “stand-alone” HR solution likely came after the invention of the HRMS (Human Resource Management Solution) to try and differentiate the two. You’ll know you’re working with an HRIS if it doesn’t contain features like payroll and time and labor. 

You also won’t get a paystub generator and various other templates, so you’ll have to use other websites for payroll management, setting up direct deposits, and end-of-the-year taxation.

The Advantages of Using Stand-alone HR Software

When you use stand-alone software, you receive the following advantages:

• Improves the application and recruitment process by tracking resumes.

• Includes software that automates onboarding tasks with checklists.

• Absent management, including unplanned sick leave and vacation time.

• Creates and manages business workflow to boost productivity.

• Manages health insurance and 401(k) plans.

• Allows businesses to set up salaries, overtime, and paid time off.

• Sets up education and training programs.

• Gives access to self-service employee portals for e-signatures and benefits.

• Manages all relevant employee info in one repository.

• Significantly less expensive than an HR suite.

Although stand-alone HR software has plenty of advantages, they have multiple disadvantages.

The Disadvantages of Using Stand-alone HR Software

When you use stand-alone software, you receive the following disadvantages:

• Less powerful than an HR suite and is limited in its use.

• HRIS software will become obsolete as you scale.

• Doesn’t offer integration with other systems.

• Can’t handle multiple international employees and their tax burdens.

• Doesn’t include payroll, time and labor management, and other features.

What is an HR suite (HRMS)?

Similar to stand-alone software, HR suites help businesses manage and organize employee-related data, like benefits information, job info, demographic data, performance reviews, and leave balances. However, they go above and beyond by offering more features.

HRMS software is a total solution that allows companies to manage all aspects of their HR and accommodates a global presence. Businesses can use customization tools to create country-specific tags that cater to employees in their locations.

HRMS solutions are much more powerful than an HRIS and are capable of using analytic, payroll, and time and labor management.

The Advantages of Using an HR Suite

When you use an HR Suite, you receive the following advantages:

• Businesses get an all-in-one software that suits their HR and payroll needs.

• Encourages collaboration through shared information gathering and data transfers.

• Companies control regulatory compliance to reduce social risk.

• Business processes become standardized.

• Customized workflows and employee management.

• Time-consuming tasks are automated.

• Supports integration with third-party apps.

• In-depth analytics on employee advocacy, brand shares, and social media follows.

• Keeps payroll secure with encryption.

• Can account for changes in the company.

• Optimized to adapt to the latest regulatory constraints.

• Provides a secure, safe and reliable infrastructure.

• Gives businesses total control over their operating and maintenance costs.

Although HR Suites have plenty of advantages, they also come with a few disadvantages.

The Disadvantages of Using an HR Suite

When you use an HR Suite, you receive the following disadvantages:

• Many companies prioritize one section of their suite over another

• Although more secure than stand-alone systems, suites contain payroll data, making successful hacks more costly for the company.

• More systems often mean more can go wrong.

• Significantly more expensive than stand-alone systems.

• Requires more research to find the best product.

Conclusion

Although HR suites appear to be the best option, don’t automatically assume they’ll fit the bill. Several business owners can’t afford an HRMS and will need to build a larger team before its other features become useful. We recommend starting with an HRIS if you’re a startup.