Give yourself a raise

Spend less on HR—and send the rest to the bottom line. Web-based services cut paperwork, streamline benefits, and help employees help themselves.
Written by Joyce Slaton, Contributor
Spend less on HR—and send the rest to the bottom line. Web-based services cut paperwork, streamline benefits, and help employees help themselves

Your human resources department has enough worries—baby-sitting your workforce shouldn't be one of them. Sure, it's important that someone remind new hires to sign up for an insurance plan, but wouldn't you rather see your top-level HR people recruiting the best talent and handling sticky employee issues?

A Web-based human resources management solution can help. These services let you automate time-consuming HR responsibilities like running weekly reports, drafting employee handbooks, orienting new hires, and even tracking vacation time. Better yet, employees can take control of their own benefits—without ever contacting the HR department.

"Any company with at least 100 employees can and should have an [HR system] in place," says John Ryder, chairman of the Human Resources Technology Management Committee, a professional subgroup of the Society for Human Resource Management. "A good one can reduce the number of HR employees needed to keep a company running, as well as the administrative hassles that have traditionally gone with the job."

Web-based human resources services are on the rise. Thirty-five percent of the application service provider market focuses on HR solutions. Of those, 10 percent of the HR systems purchased are truly Web-based, according to Ben Pring, a principal analyst with market research firm Gartner.

While the number of businesses using Web-based human resources systems is still relatively small, some companies, such as One Workplace, an office space design firm and furniture retailer in Milpitas, California, are catching on. "We've reduced our administrative workload by about 65 percent," says Jeffrey Crocker, executive director of human resources. "Now we can focus on more proactive tasks, such as developing training profiles for each position in our organization. I'm paying good wages to our HR people to do senior-level work and now I'm letting them do that rather than forcing them to focus on boring paperwork."

Top 5 Reasons To Use Web-Based HR Systems

  • Give employees access.
    No one wants to do the HR grunt work. Let workers enter their own data and view their own records.

  • Centralize your files.
    Replace redundant employee databases with one Web-based information source.

  • Blitz through paperwork.
    Move the paperwork off your HR team's desk. Web-based reports keep all necessary information on tap.

  • Reduce workload. Let templates and online orientation features give your HR team more time for strategic planning.

  • Put managers in control.
    Give managers the tools they need to analyze employee performance without involving HR.
    Cut the time your staff spends sorting through piles of paperwork by automating repetitive tasks.

    Web-based HR solutions offer more advanced options by transferring tedious paperwork online. Julie Boisselle, office manager for Genalytics, an e-commerce marketing software firm in Newburyport, Massachusetts, used to keep a spreadsheet to track employee vacation time—a method she admits wasn't working. "We kept having the problem of people using up more vacation time than they'd accrued and then leaving the company," she says. But with help from eBenefits' VirtualHR service, Genalytics' employees no longer vacation on borrowed time. "Now the system automatically calculates vacation time each month and my only job is to deduct time when they take it," she says.

    Web-based tools also update managers on key milestones. For example at BuildNet, a construction management software developer in Research Triangle Park, North Carolina, when an employee is due for a raise, the reporting tools in NuView Systems' MyHRIS notify the correct supervisor. "Before, when using an Excel spreadsheet, it involved a lot of tracking employees down to ask them questions and filling out forms," says David Russo, executive vice president of human resources. "Now it's much more click-and-go because there's just one place to input and manage all your HR information—it's like having an extra, efficient employee."

    What's more, when an employee leaves the company, an HR system can expedite the paper-intensive process, including issuing final paychecks and tallying vacation compensation. For example, when a claim comes in from COBRA—an insurance extension program—One Workplace's Crocker doesn't need to search his files. The company's MyHRIS system takes care of it. "The idea of not having to remember—if I called this manager, made sure I got this letter back, and signed off on this or that—is so reassuring," he says.

    Put them in charge: Let workers manage their own benefits.

    Many HR management tools also include features that let your employees complete company forms, organize and control their own benefits, and even change their 401(k) account setup—all from their own desks.

    "We've integrated our payroll information so employees can manage their paychecks, withholdings, and benefits," says Anthony Damaschino, vice president of talent for Groundswell, a Pleasanton, California–based portal consultancy group that uses Simpata. "The days of filling in paperwork and waiting for HR to get back to you are over."

    Thanks to the VirtualHR online orientation program, Genalytics' Boisselle now saves at least a half-day's work with each new hire. "When a new employee starts, now I simply set up a file for them with all the electronic forms needed," she says. "They go in on their own time and fill everything out. It's routed where it needs to go and I've saved all that time."

    For Phoenix Resource Group, a Walnut Creek, California–based staffing company, the self-serve Simpata system makes short work of handling new hires. "Our employee base is continually changing. Keeping track of who's eligible for benefits and who wants what is a real headache," says Al Cremeen, director of business support. "We want our employees to be notified when they're eligible and be able to choose their own HMO, choose their own dental or vision coverage provider, and sign up for it themselves."

    Track employee information easily with the help of Web-based systems.

    Web-based HR tools make standard reports much easier to complete. "In HR, a manager may come in and ask how long it's been since an employee was reviewed and will want to couple that with the training he or she has in an area of expertise," says BuildNet's Russo. "The ability to generate those reports on the fly and not manually search through a spreadsheet or go to the IT department to ask how to do it is pretty amazing."

    Managers can also easily stay on top of an employee's progress through the company. For example, One Workplace offers training programs as a means for promotions. MyHRIS lets managers instantly see exactly where employees are in the process. "Within 15 seconds you can say to that employee, 'I see you've taken this class and this one. When are you going to take this one so you can move into that job you want?' " says Crocker.

    There's another necessary evil on any HR professional's to-do list: creating and updating the employee handbook. Web-based tools let you know who's read the handbook and who hasn't. The HR department at San Francisco–based Web content company iSyndicate keeps track by using Simpata's service. "We link to our handbook and include a general statement online that you've read and understood the employee handbook," says Paul Vagadori, director of iSyndicate's people team. "Then I can run a report, find out who hasn't read it yet, and use [Simpata] or our internal e-mail system to send a mass e-mail to everyone whose name comes up on the report and bug them to read it."

    How'd they stack up? Our panel of professionals rated the top four Web-based HR systems.

    We put four of the top full-service Web-based HR systems—eBenefits' VirtualHR, HR One's HR Desktop Gold, NuView's MyHRIS, and Simpata's service—to the test in the Ziff Davis Smart Business Labs to find out how they stacked up. Our testers either work in HR management or need a Web-based HR tool in their profession.

    During the course of the trials, testers added newly hired employees, made modifications to a database, sent a notification of that change, and finally generated and printed a report.

    Of the four services tested, eBenefits' VirtualHR made a clean sweep to victory. The package includes standard and custom reporting tools, automated employee files, and company recruitment initiatives. Employees can log in to view company orientation presentations, track vacation time, and even ask for time off. The service also provides links to state and federal government employment law sites. Virtual HR costs US$3 per employee per month. Companies with fewer than 10 employees pay US$30 a month.

    Overall, testers said VirtualHR's intuitive navigation and clean design put it above the other services. Tabs labeling each area made it easy for testers to complete the required tasks. Adding an employee went quickly. Users gave high marks to VirtualHR's cross-referenced database, which automatically routes employee information to the correct file.

    While editing the database was straightforward, VirtualHR's small buttons and checkboxes initially confused some testers (eBenefits has since redesigned VirtualHR's interface to address navigation problems). Running reports also went smoothly, although one tester wanted better defined reports and another wanted to be rerouted back to her working page after running a report.

    HR One's HR Desktop Gold was the first runner-up. The service offers a series of automated features including company reporting, employee handbooks, and new-hire orientation tools. Additionally, employees can track their own benefits and vacation time. The service also provides a section for employee surveys and feedback, as well as performance recognition. Companies with up to 10 employees pay US$40 a month, which ratchets up to US$350 a month for companies with more than 100 employees.

    Most testers liked the look and feel of HR One's home page. The site offers not only HR tools but news and industry information as well. Link placement and tab descriptions make HR tasks easy to complete. Testers found adding a new hire fairly easy, although some had difficulty navigating through the input fields. Users praised HR Desktop Gold's monitoring feature, which tracks employees who have read and signed off on company policies. They also liked the range of available reports.

    When testers updated information in the database, however, they experienced mixed results. One tester had no problem changing an employee title, but another couldn't complete the task. Modifying security access levels also proved frustrating. Some testers gave up. Most problems stemmed from HR Desktop Gold's online help tool. The Live Assistant feature crashed for one user and another tester tried for five minutes to connect before calling it quits.

    Second runner-up Simpata features hiring and firing modules, payroll management, benefits administration, employee profile management, and vacation tracking. The new-hire feature lets employees fill out company forms online—and then sends an instant report to the HR department. It also lets employees view and modify 401(k) and other benefits plans online. The service costs about US$5 a month per employee.

    Simpata initially scored well, thanks to its easy navigation and consistent, colorful graphics. As testers dug deeper into the system, however, Simpata proved more difficult to use. Although search functions made changes painless, when some testers went back to check entries, the information was missing. While testers praised the variety of reports available, they found that generating reports delivered inconsistent results. Some took too long to complete, while others took only a few minutes. Testers were also confused about security levels. They couldn't tell who had access to sensitive employee information.

    NuView's MyHRIS offers standard employee information and profile management, vacation tracking, compliance management, and benefits administration. You can build profiles of the education, experience, and training needed for each position within a company. Pricing ranges from US$4 to US$8 per employee. Companies can also buy NuView's software and host it themselves. The package costs from US$18,000 to US$148,000, depending on the number of employees.

    But despite its wealth of features, most testers expressed only disappointment with MyHRIS. Several testers were unable to add a new hire. Additionally, testers complained about confusing field names and cryptic error messages. These and other shortcomings make MyHRIS difficult to recommend.

    Web-based HR tools can save companies an enormous amount of hassle and paperwork as well as time spent on the administrative duties that typically bedevil your staff. None of the services we tested was perfect. But their ability to streamline difficult and paper-loaded tasks more than outweighed their shortcomings. Given the low cost of these Web-based HR systems, almost any company can afford one.

    Of the four Web-based HR systems we tested, one clearly outshined the rest.  

    Service Pros Cons Verdict
    eBenefits VirtualHR
    (800) 859-5038
    US$3 per employee per month; US$30 per month for fewer than 10 employees
    Easy to find exactly what you're looking for; clearly defined menus. Occasionally vague instructions; some difficulty with reporting tools. 5 stars
    Smart design puts everything you need at your fingertips.
    HR One HR Desktop Gold
    (866) 473-3758, ext. 224
    Starts at US$40 a month for up to 10 employees, increasing to US$350 for over 100 employees
    Straightforward design; useful verification tool; broad scope of services. Online help difficult to access and use; confusing security levels and internal message system. 4 stars
    A gentle learning curve for new users, but online help should be front and center.
    (877) 477-4675
    About US$5 per employee per month
    Easy to add and verify information; handy search function; variety of reports to choose from. Difficult to produce and print reports; access levels confusing; less-than-intuitive navigation. 3 stars
    Consistent layout makes changes easy, but reporting is much too painful.
    NuView Systems MyHRIS
    (800) 244-7654
    US$4 to US$8 per employee; US$18,000–US$148,000 to buy the software
    In-depth reports; sophisticated range of advanced features. Confusing site navigation; adding new employees is difficult; frequent cryptic error messages. 2 stars
    It's long on the features HR pros need—but first-timers will find it frustrating to use.
    5 stars 4 stars 3 stars 2 stars 1 stars
    Excellent Good Fair Poor Unacceptable

    Don't need or want an end-to-end HR system for the entire company? Here are other HR add-ons that you can rent, purchase, or use free online to solve a specific problem.

    HR professionals will find scores of original recruitment, payroll, benefits, and employee management checklists and forms here.

    More than 150 tools, checklists, and forms for HR pros looking for information on hiring and firing, benefits and compensation administration, legal compliance, and safety.

    HR One
    Its HR Desktop products wrap up all tools in one end-to-end package. However, HR One also provides such stand-alone products as an employee attendance tracker, an employee records file, online employee handbooks, online performance reviews, and payroll outsourcing.

    Information on and forms for such fundamental HR areas as hiring, benefits, payroll, training, and compliance. Also recommends partnered companies for those seeking insurance carriers, job posting sites, and other services.

  • Editorial standards