ERP’s Role in Managing Human Resources

Last Updated: September 13th, 2023
Researched and Written by: Sydney Hoffman

ERP software integrates various business functions, like finance, manufacturing, and sales, into unified modules on a single platform. Originally built to streamline manufacturing and financial operations, ERP has evolved to include HR modules. Now HR teams can streamline recruitment, payroll, and employee performance tracking, improving operations and efficiency.

ERP and Human Resources Overview

For HR professionals, juggling administrative responsibilities such as onboarding with strategic tasks like culture-building can be challenging. This balancing act becomes even more difficult in organizations without advanced technological support. However, ERP software offers a solution by integrating diverse business processes, creating a cohesive platform accessible across departments.

Within these extensive systems, the HR module shines, equipped with tools like employee self-service portals, automated attendance tracking, and predictive analytics geared toward optimal talent management.

Why Use HR ERP Systems?

Implementing an ERP system with a human resources module can redefine how HR operations are managed. It expands beyond basic payroll and attendance, offering a comprehensive approach to employee management from hire to retire. HR ERP software enhances consistency and provides a broader, strategic workforce perspective.

  • Ensuring Consistency: It standardizes HR processes across the board, so from processing payroll to onboarding new hires, the operations remain consistent across various departments.
  • Boosting Efficiency: By automating manual tasks such as leave applications or benefits enrollment, HR professionals can focus on more strategic roles instead of getting bogged down with administrative chores.
  • Offering a Strategic View: With an integrated dashboard, HR ERP systems provide a holistic view of the workforce. This means HR can monitor real-time data, like employee engagement or productivity metrics, to make strategic decisions for the organization’s growth.
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Features Of An HR Module in ERP

ERP platforms offer a range of features designed to simplify human resources. By leveraging these tools, HR teams can foster greater productivity and more effective management of human capital.

  • Time and Attendance Management: This feature tracks employee work hours, overtime, and leave with accuracy, ensuring that payroll is precise and managers can oversee productivity seamlessly.
  • Recruitment: ERP streamlines the hiring process from job postings to onboarding, ensuring the best talent is efficiently brought on board.
  • Employee Portals: These portals enable employees to manage their personal details, leave applications, and payslips, lightening the administrative load on HR departments.
  • Reporting: Advanced reporting features allow for generating detailed insights, such as turnover rates or employee performance evaluations.
  • Training and Development: This functionality helps monitor training sessions, ensuring employees are consistently upskilled and aligned with organizational goals.

Benefits of Using HR ERP

By integrating ERP systems into their operations, HR departments can promote smoother workflows and strategic advantages:

  • Streamlined Operations: By centralizing functions, ERP cuts down redundancy. For instance, without ERP, the HR team might manually track an employee’s leave. But ERP automates this, eliminating duplicate work.
  • Data-Driven Decision Making: An ERP might produce a report highlighting a higher turnover rate in a specific department. HR can then strategically focus on that department, identifying underlying issues and working on retention strategies.
  • Enhanced Employee Experience: HR ERP software can facilitate quicker response times to employee queries and accurate data handling, boosting employee trust and satisfaction.
  • Cost Savings: Automating payroll processing, a critical HR function, minimizes human errors (like overpayments), resulting in significant savings over time. Also, by automating, HR can handle more tasks without additional personnel, reducing overhead costs.


Which ERP systems have the best HR capabilities?

Infor CloudSuite Industrial (Syteline): Professionals consider Infor CloudSuite Industrial robust due to its powerful talent, performance, and workforce management. It provides facilities for employee onboarding, e-learning, and skill development.

Oracle NetSuite: NetSuite handles complex payroll requirements, integrating seamlessly with the finance module for accurate and timely payments. It also offers tools for goal setting, performance reviews, and 360-degree feedback.

Dynamics 365 Business Central: Its integration with the familiar Microsoft ecosystem and an intuitive interface makes Dynamics 365 Business Central’s user experience seamless. This is especially true for HR professionals familiar with other Microsoft tools. HR professionals can also track metrics like turnover rate, absenteeism, and more using its embedded Power BI integration.

What is the difference between ERP and HRIS?

ERP Software:

  • Is an integrated system managing various business processes across an organization.
  • Encompasses multiple departments, from finance to supply chain.
  • Offers a holistic view of an organization’s operations.

HRIS Software (Human Resource Information System):

  • Is specifically designed for HR functions.
  • Handles tasks like payroll, recruitment, and employee management.
  • Is more focused and in-depth, catering solely to HR needs.
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