When you consider purchasing a new HR solution, it’s important to approach the process as an informed buyer. But, software vendor jargon and marketing lingo can make an HR tech buyer’s job more challenging than it needs to be. To help you sort through the noise and find the perfect HR software solution for your business, we’ve put together this HR technology buyer’s guide, complete with all the HR technology terms and definitions you need to make an informed buying decision and ensure you pick the best HR tech for your needs.
Here’s a closer look at the terms any HR buyer should know when picking out a new HR software solution:
AI (Artificial Intelligence): Artificial intelligence refers to computer systems and applications that can collect, analyze, and use data to learn how to perform tasks that would traditionally require human problem-solving. It allows businesses to automate tasks and improve the accuracy and speed with which they accomplish specific projects. Uses of AI in the HR space include automated programs that sort through applicant resumes, schedule candidate interviews, and analyze employee survey responses.
API (Application Programming Interface): An API allows two or more computer programs to communicate with one another, allowing them to seamlessly share information across platforms. APIs also make it easier for software developers to customize solutions to fit your business’s exact needs, without having to build from scratch.
ATS (Applicant Tracking System): Talent acquisition teams use an ATS to streamline the hiring process by simplifying tasks like posting jobs, screening resumes, scheduling interviews, and more. This HR tech solution not only speeds up time-to-hire for your business but also gives your applicants an exceptional candidate experience.
Benchmarking: Benchmarking is a process of comparing your business’s data to aggregate data from businesses that have a similar size, location, or industry, among other factors. This allows you to understand how your business compares to other similar companies.
Benefits Software: Benefits software simplifies selecting and administering the right benefits for your employees, like health, dental, and vision, as well as retirement plans, paid time off, and stock options.
Blockchain: A blockchain spreads transactional records across a network of many computers to maximize security. Since the blockchain doesn’t have one central point where all information is stored, it’s difficult for an entity or individual to hack into the system and change information, making it a desirable way to store sensitive employee and payroll information.
Candidate Assessment Tool: Candidate assessment tools allow recruiters to assign tasks and aptitude tests to potential job candidates to evaluate their skills and potential. These solutions help businesses with a large number of applicants quickly identify the most qualified candidates and move them forward in the hiring process.
Chatbot: In the HR space, chatbots can be used to support current and prospective employees. Chatbots can help answer common employee questions, surface helpful information or People support articles, and even handle employee referrals. Plus, job candidates can use your business’s HR chatbot to find answers to their questions, check the status of their application, and schedule interviews.
Compensation Management Software: Compensation management software allows businesses to securely set and update employee compensation packages, which can bolster pay clarity and consistency across a company. Some solutions, like Lattice Compensation, combine performance and compensation data to ensure employees are properly rewarded using performance ratings, compensation ratios, and more.
CRM (Customer or Candidate Relationship Management): A candidate relationship management solution allows HR professionals to maintain relationships with past job applicants and keep a healthy candidate pool for future roles. Recruiters can use the CRM system to send personalized emails and text messages, invitations to recruiting events, candidate surveys, and more to current and prospective applicants.
Employee Engagement Software: Employee engagement software helps businesses collect and act on employee feedback (often via eNPS, engagement, onboarding and exit, and pulse surveys), recognize and reward employee achievements, and analyze data to identify key areas of development. This can help your business proactively improve the employee experience and boost retention in the process.
Employee Portal: An employee portal, also called a company intranet, is a secure site where employees can log in and access company-specific information and news.
Employee Recognition Platform: An employee recognition platform allows businesses to celebrate their employees’ hard work by sharing written praise or monetary incentives.
Employee Referral Software: Employee referral software helps get current employees involved in the recruitment process. It makes it easy for employees to recommend individuals for open roles, share job postings to their social media accounts, and receive incentives if one of their referrals becomes a successful hire.
HCM (Human Capital Management): Human capital management is designed to support businesses across the entire employee lifecycle, including hiring, managing, retaining, and developing talent. A unified HCM solution offers the most extensive suite of talent management tools compared to HRIS and HRMS, with applications for recruitment, onboarding, payroll, time and attendance, benefits, learning and development, reporting, and global compliance.
HRIS (Human Resources Information System): An HRIS streamlines core HR processes — like payroll, benefits, and compliance — by sharing and synchronizing employee data across all of these tools. While HRIS solutions are a great software choice for small to mid-sized companies, they lack the more robust talent and performance management offerings that HRMS and HCM systems are known for, which can be better suited for larger enterprise businesses.
HRMS (Human Resources Management System): Like an HRIS, an HRMS provides most core HR processes, but this system also offers additional functionality like in-depth reporting, as well as talent acquisition and employee development tools. But as technology advances and more HR vendors try to build all-in-one software, the differences between HCM, HRIS, and HRMS solutions are becoming less apparent.
Implementation: Implementation is the process of moving from one HR system to another, or adopting an HR solution for the first time. Implementation time varies by provider and depends on the complexity your business requires. For example, adopting a new employee recognition software for the first time should be fairly simple, while onboarding a new HRIS will require secure data transfers, custom template build-outs, and more.
Integration: An integration allows two of your HR systems to work together and exchange data back and forth. This can be especially valuable if you have multiple HR point solutions, such as integrating your HRIS and payroll provider to seamlessly share employee information like updated addresses and name changes.
Interview Scheduling Software: Scheduling and rescheduling candidate interviews can be immensely time-consuming for recruiters. Interview scheduling software makes it easier for prospective employees to share their availability with hiring managers and recruiters, so your team can choose an interview time more efficiently.
LMS (Learning Management System): An LMS empowers businesses to develop employee training opportunities and evaluate the success of these initiatives. While some learning management systems come with pre-designed courses, most allow organizations to build custom training programs to target specific internal education and growth needs.
Machine Learning: Machine learning is a form of artificial intelligence that teaches computers to “learn” by using historical data, identifying patterns, and making logical assumptions.
Onboarding Software: Your employees’ first few days at your company set the pace for the rest of their time there, so you want to provide a good first impression. Employee onboarding software can give your employees a warm welcome and ensure they complete required compliance training and forms, gain access to any systems they need, and watch any additional company- or department-specific training videos, as needed.
On-Premises Software: On-premises software, or on-prem, requires an organization to purchase, install, and run a version on your business’s devices or servers in order to use it, as opposed to a SaaS application which can be accessed via the web. On-premises software is more secure than SaaS applications, as it is stored within your company’s computing infrastructure and is less susceptible to cloud computing hacks.
Payroll Software: Payroll software helps businesses manage accurate employee payments, process paycheck deductions, and maintain compliance with local and federal tax laws.
People Analytics: People analytics involves collecting and interpreting HR data to inform data-backed workplace decisions, like predicting turnover, identifying internal development opportunities, and making equitable compensation changes.
People Success Platform: People success platforms like Lattice combine performance management, engagement, goal-setting, development, compensation, and analytics in one platform. This HR tech solution empowers People leaders to build engaged, high-performing teams, inspire winning cultures, and make strategic, data-driven business decisions.
PEO (Professional Employer Organization): A PEO is an outside firm that handles HR, payroll, and benefits administration on behalf of another company. Typically, smaller companies without the headcount or resources to perform these tasks on their own outsource them to a PEO.
Performance Management System: Performance management systems do so much more than just help administer performance reviews. They track employee performance, collect and store feedback, help managers become career coaches, and ensure individuals have targeted professional development goals.
SaaS (Software as a Service): Software as a service is a way to deliver an application that’s available over the internet, instead of having to install software or hardware. SaaS products update automatically and may be able to integrate with any existing HR solutions in your tech stack.
Sandbox Environment: A sandbox, or testing environment, allows HR professionals to experiment with a solution without worrying about disturbing the employee view. It’s a helpful feature that can let your team familiarize themselves with the tool and play around with new updates without disturbing your current setup.
SSO (Single Sign-On): Single sign-on technology allows employees to use one email and password to access multiple applications. This makes it easy for employees to sign on and access your HR tech suite, without the hassle of remembering multiple website URLs, logins, and passwords.
RFP (Request for Proposal): A request for proposal is a formal document that asks prospective vendors to bid for a project. It typically includes information like project scope, budget, deadlines, and key stakeholders.
Video Interview Software: Video interview software allows recruiters to speak with and evaluate candidates remotely.
Workforce Planning Software: Workforce planning software gives businesses visibility into current headcount, employee resource allocation, future headcount needs, and staffing budget estimates. Together, this information empowers HR teams to make more informed hiring and budgeting decisions, which in turn allows the organization to stay on track to meet its targets.
Workplace Wellness: The employee wellness space has transformed in the last few years to include significantly more offerings than were traditionally available in the past. Now, many businesses choose to invest in wellness providers in the fertility, mental health, fitness, financial counseling, and nutrition spaces.
Now that you’ve brushed up on this inclusive list of HR technology buying terms, the next step in your buyer’s journey is to determine exactly what type or types of HR software your business needs.
When it comes to choosing the right vendor for your organization’s current and future needs –-– Don’t compromise. Check out our HR Technology Requirements List for guidance on how to build a purchasing criteria that finds the perfect solution for your business.