Best HR Software of 2023

What is HR software?

The growing human resources (HR) software market is forecasted to reach $33.58 billion by 2026. While most companies and individuals are somewhat familiar with HR software packages, the landscape is rapidly changing with the addition of new best-of-breed apps and to keep pace with the ways changing technology affects how users want to interact with software.

In its inception as licensed on-premise software, HR management software was restricted to employee data, payroll, and benefits. But the market has expanded significantly due to automated workflows and demand for cloud technology. These changes in customer expectations and the greater willingness of the workforce to use self-service models now mean HR tasks like payroll, time-off requests, benefits management, and org charts take up less administrative time, which frees up the HR team to focus their attentions on recruiting, employee experience, workforce management, company culture, branding, and other tasks that now fall under the descriptor of talent management.

Top Human Resources Software

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Current trends in HR systems

As the human resources software market grows and changes, there are a few additional considerations to make when choosing a solution. Features such as HR analytics, social integration, and mobile capabilities are becoming standard issue for most platforms rather than innovative selling points.

Here are the most prominent and ongoing trends for some of the best human resource management software providers on the market today:

Artificial intelligence (AI) and machine learning

The growth of AI and Machine Learning in the software space is undeniable, with nearly 50 percent of businesses saying they’ve adopted AI in at least one aspect of their business. Currently, AI companies are building tools that help HR managers with recruiting and onboarding new employees, and some companies are using the technology to make more intelligent pulse surveys.

Machine Learning can most often be found in the elearning fields and within LMS software to better understand what types of courses employees should take next. These tools can also be used to offer learners new resources based on established learning patterns and behavior. They’re also helpful in recruiting tools to reduce hiring biases and find qualified candidates quickly.

AI and Machine Learning are both still relatively new fields of technology that are just finding applications within HR systems. Expect to see big strides within both of these fields over the coming years as the technology matures.

Team management vs. talent management

As with any trend in HR, team management, also called workforce management, styles go through swings along the personalization scale. And while greater personalization is a huge trend across both employee and consumer management, many companies find that managing teams of employees who share similar business outcome goals makes sense.

This trend has changed how management and employees communicate, how managers and HR professionals look at performance, and how the whole company looks at employee engagement. Expect to see this trend play out in team goal-setting and business organizations. While perhaps not fully affecting recruiting yet, workforce management will have an effect on interviews as managers will need to ensure candidates can work well with their teams.

HR consulting services

Small and medium-sized businesses (SMBs) don’t typically prioritize HR staff, which can create delays or difficulties with core HR processes like payroll and recruiting. Luckily, many HR software companies have started to offer HR services as an add-on in their packages. With these services, the vendors act as an HR managed services provider, allowing these small organizations to outsource their core HR functions.

These HR services allow SMBs to cover these core functions at a cheaper cost than hiring in-house personnel. It also removes some of the burden from the business’s workforce, allowing them to improve their own productivity and optimize their department.

Best of breed vs. integrated systems

Driven largely by the overall move to cloud software, many companies now choose to use several separate HR platforms to manage the entire employee life cycle rather than contract a fully featured HRIS. This choice is sometimes financially motivated, but there are many factors at play here.

HRIS can be difficult to implement at first, requiring several months or years of onboarding (depending on the size of the company). However, once it’s in place, the HRIS can act as a central source of truth for everything related to employee information including:

• Payroll software
• Time tracking
• Performance management
• Employee engagement
• LMS and elearning
• Succession management
• Benefits

Companies that choose to implement separate software for each of these items may find comfort in SaaS’s subscription model that gives them the freedom to switch providers at any time, or they may choose to only implement each software as it becomes necessary to the company’s growth.

A third option employed by many companies is to skip both HRIS and SaaS software and implement an ERP system instead. This software tends to be more complicated than HRIS systems, but can include vital features like supply chain management and financial systems.

Company branding & culture

Workplace culture and company branding have affected all points in the employee lifecycle. Recruitment strategies that look more like marketing and employee health and wellness programs help companies plan and involve employees in positive company cultures. These programs help companies combat the rising cost of mental health issues that impact time loss and benefits coverage.

Companies can expect HR teams and individual employees to push for professional development, elearning, wellness benefits, and greater attention to harmful workplace cultures than ever before. These priorities can be tracked and improved through the use of HR systems including performance reviews, LMS, and recruiting systems.