<aside> What’s this about? An HR system (often called an HRIS, or human resources information system) is a software tool for managing employee data.

What do I need to do? Determine a suitable HRIS given your organization’s needs and budget, and configure the system to match your organization’s employment policies and procedures.

Contents

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Further reading

Databases

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The basics of HR

HR broadly refers to the management of personnel policies and procedures.

This includes:

Employee expenses are sometimes considered to fall under HR. In the Nonprofit Playbook we’ve treated expenses as a component of finance — for more information, see Set up an expense management system.

Similarly, team culture, productivity, and team retreats are sometimes considered to fall under HR. We believe these are more suitably captured by the People Operations function — broadly, the management of employee experience, retention, and productivity. Sometimes People Operations is considered a sub-section of HR, sometimes it’s a standalone sibling function. We don’t cover People Operations in the Nonprofit Playbook, as we believe this is a less essential function in the early days of an organization.

What’s an HRIS?

An HR system (often called an HRIS, or human resources information system) is a software tool for managing employee data.

A typical HRIS might offer applicant tracking, contract sending and signature, onboarding workflows, an org chart, payroll and payslips, reimbursement requests, and vacation requests.

The interface for Deel, a recommended HRIS

The interface for Deel, a recommended HRIS

Setting up an HRIS

There are dozens of well-reviewed HRISs in the wild, and it can be difficult and time-consuming to identify one that suits the needs of your organization.

Here’s how we recommend you approach it:

  1. Identify priority features: Not all platforms offer the same sets of features, and not all features are implemented equally well. It’s worth identifying which features are deal-breakers for your organization, and potentially ranking features by priority (or using a weighted factor model). When we analyze HRISs, we’re typically interested in certain features like onboarding, payroll, and leave management. Here’s a template you can use to determine your priority features.
  2. Determine budget: What’s the value of a good HRIS? This will depend on your budget, team culture and size, as well as your working preferences, and whether you’re already using other systems that overlap with the features of the HRIS. (For example, you may already be using a dedicated expense management system for reimbursements, which could make the value of the HRIS significantly lower.) A typical pricing structure for an HRIS is on the order of $9 per user per month. However, there are notable exceptions. Deel HR, for example, is free (although specific modules, like global payroll, come at an extra cost). On the other hand, the more feature-rich and flexible solutions — like Rippling or HiBob — might set you back $20–$40 per user per month (exact pricing is often determined on a case-by-case basis.) Here’s a template you can use to determine your budget.
  3. Create a comparison spreadsheet: An HRIS touches many elements of an organization, from vacation requests to payroll. This means that there are often several stakeholders in play. It’s therefore useful to present the options you’ve considered — with summaries, pros and cons, expected costs, and the presence or absence of your priority features. As you’re doing this, make sure to check out endorsements and see what users of the HRIS have to say about it. Look up ratings on Capterra and Trustpilot — a score of 4.5 and above (ideally based on 100+ reviews) is a good sign. Also, check out our assessment. Popular platforms include Deel, Rippling, Bamboo, and Personio.
  4. See the platforms in action: There’s no substitute for a demo of the HRIS, to get a feel for the user experience, user interface, and the actual implementation of the features you’re interested in. You might begin your investigation by checking out third-party walkthroughs on YouTube — like these walkthroughs for Rippling, Bamboo, Sage HR, Personio, and Gusto. Most providers will have their own YouTube channels with first-party tutorials, but these are often less useful or impartial. As you narrow down your list of contenders, register for demos or trial accounts with the providers directly.

Here’s a template you can use to highlight the differences among platforms, with some suggested platforms listed to get you started. Keep in mind that it makes sense to invest some time here at the start, because switching to a different system later on comes with high costs (it’s difficult to establish new processes in teams once they’ve been established).

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