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How Does a Good HRMS Benefit an Organization?

By OrangeHRM | Published on Jul 9, 2019 | minute read

Today, organizations that proactively embrace and strategically integrate the right technology into their core operations invariably enjoy a significantly higher level of competency when it comes to managing mission-critical processes. This elevated state of operational excellence is consistently achieved through the adoption of ever-evolving technological solutions that are meticulously designed, integrated, and often customized to meet the specific and nuanced needs of modern businesses. Now, more than at any other period in the history of commerce, technology plays an indispensable role in streamlining service delivery in a way that not only ensures greater profitability and enhanced operational efficiency but also leads directly to increased external customer satisfaction.

Without doubt, customer satisfaction has become the single most important success factor for any organization, regardless of its industry category, size, or market position. In an increasingly competitive global marketplace, the customer's experience and their perception of value are paramount. Thus, ensuring exceptional customer satisfaction should be the key emphasis and a central strategic pillar for every organization aiming for sustained growth and market leadership. It’s crucial to recognize that "customers" can be broadly categorized as both internal and external. While external customers are those who purchase products or services, the employees of an organization are, in essence, internal customers. It is fundamentally important that these internal customers are treated with the same amount of care, respect, and consideration as external ones. Their satisfaction is intrinsically linked to the overall health and performance of the organization.

Businesses should be acutely mindful of the undeniable fact that happy, engaged, and well-supported employees will be far more likely to treat external customers with the utmost respect, empathy, and professionalism. This positive internal disposition directly translates into superior customer service interactions, fostering loyalty and positive brand perception. It should be further noted that even employees who do not interact directly with external customers can have a profound bearing on the public image and overall reputation of an organization. This influence manifests through their treatment of their colleagues, their adherence to company values, their commitment to quality, and, crucially, their deep loyalty to the organization. A disgruntled internal workforce can undermine morale, create friction, and ultimately impact product or service quality, even without direct customer contact. Thus, the importance of fostering happy and satisfied internal customers to an organization cannot be overstated. Internal customers, the employees, are unequivocally the most important asset of an organization, without which an organization will simply not be able to effectively run its business, innovate, or achieve its strategic objectives. They are the engine of all operations.

The human resource department of an organization is primarily and strategically responsible for ensuring the happiness, well-being, and satisfaction levels of all its employees (its internal customers) by proactively enabling their professional growth and supporting their personal well-being. This requires efficient processes, effective communication, and the capacity to manage a multitude of employee-related tasks seamlessly. A good HRMS (Human Resource Management System) will significantly contribute towards enhancing the efficiency and effectiveness of the HR function within an organization. This, in turn, will contribute immensely to ensuring happy, motivated, and well-supported internal customers, directly leading to increased employee loyalty and reduced turnover. Extensive research and real-world evidence have consistently proven that a Happy and Loyal Workforce will inevitably provide genuinely great customer service to their external customers. This positive feedback loop ultimately results in a direct increase in profitability, sustained growth, and enhanced market standing for the organization.

The Tangible Benefits of a Good HRMS

The implementation of a robust and well-chosen HRMS offers a multitude of tangible benefits that extend far beyond just the HR department, positively impacting the entire organization.

  • Streamlined HR Operations: A good HRMS automates and centralizes many routine HR tasks that were traditionally manual and time-consuming. This includes managing employee records, tracking attendance and leave, processing payroll, and handling benefits administration. Automation reduces administrative burden, minimizes human error, and frees up HR professionals to focus on more strategic initiatives like talent development and employee engagement.

  • Improved Data Accuracy and Accessibility: By centralizing all employee data in one secure system, an HRMS significantly improves data accuracy and ensures that information is consistent across all functions. This single source of truth eliminates discrepancies, making it easier for HR, managers, and employees to access reliable information quickly. Accurate data supports better decision-making and compliance.

  • Enhanced Employee Experience: A modern HRMS often includes self-service portals for employees. This allows employees to access their pay stubs, update personal information, request leave, and view benefits details independently. This self-service capability empowers employees, improves transparency, and reduces the need for constant HR intervention, leading to greater convenience and satisfaction.

  • Better Compliance and Risk Management: HR laws and regulations are constantly evolving and can be complex. A good HRMS helps organizations stay compliant by keeping track of regulatory changes, automating compliance checks, and providing robust reporting capabilities. This reduces the risk of legal penalties, audits, and reputational damage associated with non-compliance.

  • Strategic Workforce Planning: With comprehensive data on employee skills, performance, demographics, and career aspirations, an HRMS provides invaluable insights for strategic workforce planning. HR departments can identify skill gaps, forecast future talent needs, plan for succession, and optimize staffing levels, ensuring the organization has the right people in the right roles at the right time.

  • Support for Performance and Development: Many HRMS solutions, like OrangeHRM, integrate modules for performance management, training, and career development. This integration allows for a holistic approach to employee growth, linking performance reviews to development plans and training opportunities. This fosters a culture of continuous improvement and helps employees realize their full potential.

  • Increased Communication and Collaboration: An HRMS can facilitate better communication within the organization through internal messaging features, announcements, and feedback mechanisms. This improved communication fosters a more collaborative environment, ensuring employees are well-informed and connected, which is crucial for building a cohesive and engaged workforce.

  • Cost Savings Beyond Reduced Turnover: While reduced turnover is a significant cost saving, an HRMS also generates savings through increased efficiency, reduced administrative overhead, lower paper consumption, and optimized benefits management. The automation of tasks translates directly into reduced labor costs for administrative functions.

Why OrangeHRM?

OrangeHRM, with its world-renowned HR Software, has empowered businesses and HR personnel in over 100 countries to deliver a comprehensive and user-friendly HRMS solution to their employees – their most valuable asset. Headquartered in Secaucus, New Jersey, OrangeHRM offers an affordable and comprehensive HRMS that integrates all essential functions into one system, meeting the diverse requirements for any business to flourish.

OrangeHRM’s comprehensive, easy-to-use, and affordable system includes the following robust modules:

  • Employee Management

  • Time Tracking

  • PTO/Leave Management

  • Recruitment

  • On/Off-Boarding

  • Training

  • Performance Management

  • Career Development

  • Reporting & Analytics

Our HR Management System also comes with a convenient Mobile App, offering flexibility, and the ability to obtain individual modules for tailored solutions. Discover the numerous benefits of using OrangeHRM by booking your FREE demo here.