Enterprise Resource Planning (ERP) systems are designed to provide a ‘single point of truth’ concerning a company’s resources. However, Human Resource Management Systems (HRMS) have often evolved as separate software solutions from the rest of the company’s ERP system.
How to accomplish effective HRMS & ERP integration
For many years, ERP systems such as Oracle and SAP have provided the backbone for core HR data storage, together with financial, CRM, manufacturing and supply chain data. While these large systems offer the convenience of having the data in one location, separate standalone HRMS systems offer a ‘best of breed’ approach and are often preferred by the HR business users due to their robust, HR-centric focus. How do you handle these differing system needs? HRMS-ERP Integration to the rescue!
Integration involves the sending of data back
and forth between systems. These days, it’s a rare situation to have a single
HRMS or ERP that does everything, especially if you’re in a global environment
with local systems in place too. In addition, many companies send data to
non-HR systems too, such as finance or expense systems, in addition to the
usual integrations such as payroll or time-keeping applications. There may also
be a need to send data into your primary ERP from external systems, which adds
another level of complexity.
Integration of HRMS
software and ERP is a key area to acknowledge in HRMS implementation, as well
as from a support perspective. It requires both functional and technical
resources, to define how systems should integrate and to work through all of
the data decisions such as HRMS data mapping and integration frequency along with the technical steps
required to enable the systems to talk automatically. Each time that you HRMS
software connects to another system, there is a possibility for something to go
wrong, which is why having appropriate support structure defined is so
important in relation to this topic.
Speaking from the
perspective of a large, global company environment, while having the best software applications for your
business needs makes the
HR users happy, in a practical sense, integration adds to your HRMS landscape
complexity. A usual HR landscape is to have ERP or HRMS housing the core HR
data and acting as the system of record, and then to interface data out to all
the downstream systems such as payroll, recruitment, learning management, etc.
In a global environment, most of these cannot be real-time interfaces but
instead are daily feeds. However, living in a 24/7 environment means that
someone is always in a system. When can we interface data when everyone’s
workday ends at a different time? Who gets priority if all of these
integrations cause performance issues? Most global companies end up with a very
small window of system downtime or for patches due to the constant stream of
running integrations. Such complexity requires documentation, coordination and
strong system ownership to ensure that this vast web of data integrations can
deliver on all of the system benefits on a daily basis.
Author: Wycliffe Otieno
Information Scientist | WordPress Editor | ICT expert