Imagine a busy startup that quickly expands from a few employees to a team spread across multiple continents. Managing this growth could easily turn into a logistical nightmare. To tackle this issue, business needs some technology to handle their human resources tactfully. 

Take, for instance, a tech company that adopted automation to streamline its global operations. The company now uses workforce management software for its HR trends and operations. With features like automated payroll, real-time attendance tracking, and seamless onboarding processes, the organization not only improved its efficiency but also enhanced employee satisfaction.  

This way, technology allowed managers to focus on strategic initiatives rather than being bogged down by administrative tasks. In this blog, we’ll highlight the main aspects of using a WFM solution i.e., SaaS HR system. 

Future of SaaS HR Software 

Research from 260 international firms indicates that subscription-based SaaS systems are the way of HR software advancement. Of the firms surveyed, 46% are now utilizing such software, and 57% plan to invest in it during the next four years.  

The reason is the trend of firms adopting cloud-based business models that facilitate hybrid working patterns and the advancements in cloud technology. 

It’s blowing up, not simply expanding. The human resources software industry is expected to grow from its estimated $15.59 billion in 2020 to $33.57 billion by 2028.

What is SaaS? 

Software as a Service (SaaS) is a cloud-based delivery model in which a provider creates and manages cloud application software, offers software updates automatically, and charges users for using the software they make available online. 

The SaaS software industry is crowded with options, offering a wide range of choices. SaaS products are categorized according to the industry or sector they serve, like communication or online banking.   

Some SaaS software categories include:  

• Customer Relationship Management (CRM) software  
• Enterprise Resource Planning (ERP) software  
• Accounting software  
• Project management software  
• CMS and e-commerce platforms  
• Communication platforms  
• HR/HRM solutions  
• Payment gateways and billing solutions

SaaS examples that you may be familiar with are Google Workspace, Microsoft Office 365, and Salesforce. 

Types of SaaS HR Software 

There are three main types of SaaS HR systems for organisation and management, which include:   

1. Human Resource Management System (HRMS) 

An HR Management System is particularly related to the administration and conduct of human resources activities. These include operational activities in human resources, such as:

Employee database management: The systems are prisms by which employees store every piece of information, such as contact history, employment history, and personal attributes.

Payroll processing: This involves holding and remittance of an income tax as well as preparation for salary payments to employees, and other financial components of an employee’s compensation package. 

Benefits management: This deals with all employee benefits like pensions, health insurance, and other cash spare parts.

Time and Attendance Tracking: This includes keeping a record of the working hours of an employee and information on attendance regarding absences and annual leave. 

2. Human Capital Management (HCM) 

HCM approaches human resource management in a more comprehensive and strategic manner. It has features not found in HRMS and focuses on:  

• Talent management: It refers to the methods and resources used by an organization to find, attract, and nurture talent.  
• Workforce Planning: Predicting and analyzing labor requirements to match them with organizational goals.  
• Analytics: Using data to understand worker productivity, engagement, and the general efficacy of the organization.  
• Employee development: The process of implementing plans to improve staff members’ competencies and skills.  
• Goals Alignment: Making sure HR tactics help the organization reach its larger objectives. 

3. Human Resource Information System (HRIS) 

The HRIS comprises technologies concerned with processing HR-related data and information. It comprises:

Data Management: Basically, data management means storing all the employee-related info, such as training records, performance measures, and demographic data (collecting, organizing, and preserving employee data). 

Analysing and Reporting: Provide tools to analyse HR data to generate insights and reports to help support decision-making processes.

Information Accessibility: The provision of up-to-date and trusted HR information for managers and HR professionals.

These characteristics become very important when it comes to the choosing a tool, since HR solutions must deal with numerous facets of HR management, which include administrative tasks, strategic planning, and the making of data-supported decisions. 

When concentrating on either strategic workforce management, analysing data efficiently, or everyday practices, organizations must ensure their needs and goals are compatible with their system choice.  

After the overview of various types of HR SaaS that is, HR software-as-a-service, we explore why these SaaS HR systems must be used. 

Why Use a SaaS HR System? 

An SMB may choose to employ a SaaS HR solution for many reasons. An effective technique for managing staff more effectively in small to midsize firms is online human resource management.  

By doing this, HR professionals can reduce labor-intensive, prone-to-error manual chores (such as managing numerous spreadsheets), which will help to manage, streamline, and optimize workloads. 

Furthermore, numerous tools and applications are available in the best HR SaaS systems to assist you in managing and supervising the entire HR process. Essential HR functions that you used to manage (such as benefit administration, record updating, and employee verifications) can now be efficiently provided through self-service in a cloud computing environment. 

Premium cloud-based HR systems are highly customizable, providing you with a plethora of choices for implementing functional or design alterations unique to your business. For example, if you would like to be informed when a staff member’s birthday is approaching, workflow management software makes it simple to accomplish this.  

Finally, HR software for SMBs can be an affordable option because it is typically paid monthly, per user, with little to no upfront costs. 

Benefits of a SaaS HR System 

• Automates and streamlines your workflow  
• No requirement for ongoing maintenance and upgrades  
• Use it whenever and wherever you are 
• An abundant supply of data for all HR metrics 
• Lowers the chance of errors and upholds compliance 
• A wide variety of features to help you stay on top of every aspect of HR management   

Although these characteristics can be found in all SaaS products, they differ depending on the targeted clients’ preferences and the product’s functionality. 

Final Words 

Although Smart Workforce strongly supports HR software, we also recognize that investing in any solution is a serious decision, particularly given the current state of the economy. If you don’t have the resources in place to handle this transformation, you might not be ready for the HR system. 

This blog post might help you decide if you’re investigating and shortlisting HR software suppliers. 

You may schedule a free demo at any time to find out more about how Smart Workforce functions. Even in cases where you determine that we are not a good fit, we are always pleased to offer advice that may be of good use to you.