RSM Australia

HR systems – the benefits for small businesses

As a small or medium sized business, you might be thinking that implementing a HR system is unnecessary or irrelevant for your business. After all, HR systems are just for large corporations, only accessible by a limited number of HR and payroll administrators, and used to electronically store an endless number of personnel files, right? Wrong!

If your idea of managing employee data involves saving your employee’s most sensitive information into a folder on a shared drive or relying on spreadsheets to record employee leave balances, it’s time to get serious about your HR processes!HR systems - the benefits for small businesses

There are serious risks involved with the mishandling of employee information. Should any contracts, remuneration details, tax file numbers or bank details end up in the wrong hands, your business could be looking at some serious penalties due to a breach of the Privacy Act.

Aside from risk mitigation, there are actually many advantages that come with implementing a HR system into your small business.

But first, what are HR systems and what do they do?

The truth is HR systems are no longer clunky, desktop-based programs that run your budget into the ground.

Modern day HR systems are cost effective and suitable for even the smallest of businesses, providing business owners with the ability to do complete life-cycle on-boarding and ongoing management of employee information from any device and any HR systems - the benefits for small businesseslocation.

With your data stored securely within the cloud, a HR system will provide you with instant access to your payroll information, employees leave balances, attendance records and employee benefits information.

The benefits of implementing a HR system into your small business

All businesses, regardless of their size or number of employees, should have a reliable and efficient way of managing employee contracts, personal information, and all on-going employee data.

I find many of my clients use spreadsheets to organise their employee data, schedule follow-up review and store other private information about employees, however this method is not reliable or efficient.

There are two primary benefits small businesses receive when implementing a HR system:

1. Employee on-boarding cost and time saving

On-boarding a new employee can be a time-consuming process.

After typing out a new contract, mailing or emailing it to your new recruit and waiting for them to sign and return it, you have already spent more time than necessary on a process that doesn’t have to be so tedious. Not to mention the data entry that comes with setting up a new employee – entering in their bank account and superannuation details, tax file number… the list goes on.

Many HR systems these days will allow you to automatically generate a new contract from a range of approved templates and instantly forward to your new employee. What makes this even more amazing is that your new employee can electronically accept your offer and instantly populate their personal details into your system, basically on-boarding themselves!

2. Efficiencies in-going HR maintenance

HR systems - the benefits for small businessUnfortunately on-boarding your employees is not the end of the HR process, it’s only just the beginning.

As a small business owner, there is a good chance you don’t have your own in-house HR administrator, which means you’re responsible for all the on-going HR maintenance yourself. When it comes to managing your employee’s leave balances, monitoring sick days, conducting annual reviews… these tasks can become overwhelming, which lead some employers to avoid them altogether!

The great news is that HR software these days contain modules that are built in to assist you in managing these tasks, and most HR systems have mobile applications as well as desktop applications that you and your employees can instantly access from any device.

This means that next time you have an employee taking annual or personal leave, they can open up the app on their phone and apply at the click of a button, eliminating all double handling of data!


For more information

Contact your local RSM office for more information on implementing a HR system into your business. Every business is different and your advisor will discuss your situation with you to ensure you receive the best package to fit your business’ needs.