Human resources (HR) professionals are a busy bunch. The task of onboarding, offboarding, training, monitoring, and retaining an entire workforce is a heavy caseload, which is why businesses—even small businesses—need HR management software (HRMS) to help their people management processes run efficiently.

But not all HRMS systems are the same. For example, many of today's all-purpose HR platforms began life as systems with specialized purposes, such as payroll, performance management, or benefits administration. Depending on your specific needs, the same software that works for one organization might not be a good fit for yours.

That's why when we test and rank HRMS systems, we look at multiple factors, including their core strengths. Our top picks, listed with links to our detailed reviews, should be your entry point to navigate the broad market of HR software. If you need more assistance before making your decision, check out our buying advice below.

What Is HR Software?

At their heart, these HR tools let you manage employee records from within a desktop application, a web browser, or even a smartphone app. Some offer you the ability to tie into applicant tracking (AT), benefits administration, and performance management tools so that you can follow your employee's success from recruitment to retirement.

When selecting HR management software (HRMS), you'll want to consider several key elements. Does its user interface (UI) offer an intuitive experience that doesn't necessitate a heavy training burden? Does the tool tie into your legacy software packages, especially when it comes to data feeds? Can it scale as your company grows? Does the vendor offer the kind of service you'll need should the software fail at any point? Once you've determined your requirements and preferences, you can approach any of these vendors with a wish list. Test the solutions that meet your needs and choose the one that fits your ideal combination of price and utility.

HR software specifically designed for small businesses tops out at 1,500 or 2,000 users, while software like Deputy, Namely, and Sage Business Cloud People can accommodate workforces of 3,000 to 10,000 people (or more). Grow bigger than the maximum on most platforms, and you'll migrate to an enterprise-level system. SAP SuccessFactors is one exception; the division of HR tech giant SAP uses the same base software code as its enterprise-level software, so small businesses that outgrow it can switch up without needing to re-enter any data.

HR software and management systems are a welcome step up from the Microsoft Excel spreadsheets that many businesses—especially small ones—may still rely on to store and analyze employee data. Many cloud-based services sweeten the pot by offering a lot of extras along with basic functions at starting prices that won't break the bank. When it comes to picking the best one for your business, consider your budget, location, and what HR software you're already using so you don't pay for duplicate services.

How Much Does HR Software Cost?

Fortunately, HR software systems won't bankrupt your company. As cloud-based HR software became popular, it motivated more vendors to enter the business. The result is that features, functions, and configurability that previously only appeared in platforms for larger companies trickle down to core HR software for SMBs.

Not only are modern software-as-a-service (SaaS) offerings cheaper than traditional on-premises HR solutions, but they're also usually intuitive software platforms that are easy to use and can easily integrate with other back-office SaaS tools, such as accounting and enterprise resource planning (ERP) apps.

The field is so the costs wildly vary. At the bottom are free services, such as those from Zenefits. Paid services typically charge per employee per month, and range from $2 per employee per month (Cezanne HR's plan) to $12 per employee per month (Namely's basic plan). Many vendors charge extra for add-on modules for hiring, payroll, and the like, as well as for implementation. They also offer volume discounts and special packages to companies with larger workforces.

Still, other vendors have taken a page from consumer software by offering simple-to-use HR software that's essentially free. A prime example is Zenefits Z2, which has a freemium business model that revolutionized the category and attracted millions in venture capital (VC). Customers subsidize the platform's costs by paying Zenefits fees to act as their employee benefits broker, as well as fees the company charges for ancillary services.

What Should You Look For in HR Software?

How your company manages HR can be a highly individual affair, but there are certain key capabilities and features you should look for in any solution to make sure it evolves along with your organization's needs. We've described key capabilities below:

• Applicant Tracking (AT). Includes the ability to manage job postings, apps, and even onboarding of new employees.
• Benefits Administration. This is critical for most HR operations. What HRMS software makers offer vary from simply managing employee enrollment all the way to offering specific benefit plans.
• Scheduling and Shift Planning. These are often dedicated tools, but they also show up as part of larger HRMS platforms (or those that focus on businesses where this capability is important).
• Performance Management. This could be the ability to simply keep a record of employee goals, or it can track goals down to the task level and tie success directly to compensation and payroll.
• Online Learning. This may appear as another offshoot of performance management, letting managers provide the training that employees need to achieve their goals and keep the company in compliance if certifications are required for certain jobs.
• eLearning Authoring. Lets your company build its own training materials for internal or external use.

Regardless of its target audience, here are some other key features to look for in any HRMS system:

• Integration. Most of these players (though not all of them) offer either canned integrations or open APIs. For example, Zenefits offers integration with platforms that include Expensify, Google's G-Suite, Microsoft Office 365, Salesforce, and Slack. Canned integrations are simply a list of partner apps with which the HRMS vendor has built direct integration capability that you can opt in to by either paying extra or downloading a connector. Open APIs let your build integrations between whichever systems you like as long as they both support the API.
• Mobility. This still isn't a must-have feature for a successful HRMS implementation, but it's getting there. HR data tends to be information that employees need to access on the fly, especially things such as benefits information and time-off requests. Providing the ability to do that easily and securely on mobile devices means making sure the solution offers client software for both Android and iOS devices at a minimum.
• Security. Make certain that you investigate how the solution protects customer data. Most of these systems are cloud-based software, which means your employee data—including personal information and financial data—ends up stored online. So, it's critical that you ensure that the security tool's adequately protected with role-based access controls and at least the option to encrypt data.
• Reporting. The best HR software takes advantage of the personnel data they store to let company owners, HR executives, or HRIS managers run myriad workforce reports. These include standard reports on headcount, turnover, payroll costs, and staffing allocation. They also include options for creating custom reports that can saved or generated on a regular basis. BambooHR, for one, creates Equal Opportunity Employment (EOE) reports on job applicants by race, gender, and veteran status. Many platforms can turn report data into charts and graphs that can be printed, emailed, or downloaded in Microsoft Excel or other file formats.

Top platforms offer a surfeit of help, including setup wizards, video tutorials, 24/7 live chat, and phone support. Vendors catering to enterprise-level and midsize companies also walk customers through the implementation process (and charge extra for it). Some offer clients dedicated project managers, account executives, or support teams.

What Is Applicant Tracking Technology?

This software type makes sure you don't let your best candidates slip through your fingers because of mismanaged onboarding. The best applicant tracking (AT) tools let you follow your candidates from the first interaction until the day they leave your company. Before you choose a system, it's important to consider your team's specific needs. Do you want AT as part of a larger software ecosystem? Do you want something that can handle an unlimited number of users and job openings? How important is it to you that your system integrates well with your corporate website and email client?

Most of the AT systems we reviewed automatically post newly created jobs to free job websites and premium job websites for which you have paid a small fee. If you regularly hire people, then you'll want to purchase a tool that ties back to your corporate careers page. This enables your system to automatically feed candidate data from the app page directly into the AT software. The best tools available, including Editors' Choice winner Bullhorn Staffing and Recruiting, offer social buttons that let you share postings on Facebook, LinkedIn, and Twitter. Even the most barebones AT software comes with a robust reporting platform. Typical reports include hiring velocity, candidate sourcing, and pipeline reports. These reports are more valuable for staffing firms than for in-house recruiters, but it doesn't hurt to find a system that provides ultra-detailed reporting on attractive dashboards.

Do You Need Benefits Administration in HR Software?

Benefits administration is a core element in any good HR organization. Some businesses may be satisfied with the features provided by some of the highlighted HR management systems, but others have more complex BA requirements and need specialized software. After all, flush benefits packages are a major selling point in attracting top talent to your start-up, small to midsize business (SMB), or enterprise. The ease and efficiency through which your business administers its various benefits packages is how you keep those employees happy, and show them they're valued.

BA software should do two things: It should make it easy for HR administrators to choose and customize plans, and it should make it even simpler for employees to register for those benefits via an automated enrollment process (as well as easily access their benefits and insurance information). The standalone BA capabilities you choose within your HR suite should be able to handle basic medical, dental, vision, life insurance, and disability, with customizable plans.

On top of that, leading all-in-one BA and HR platforms such as Zenefits, the Editors' Choice winner in this category, also add the ability to manage payroll and retirement benefits such as a 401(k), plus additional perks for start-ups such as a stock option module. BA software should make people's lives easier when enrolling in the plans that best suit their needs. It should also add enough special features via an intuitive interface to keep employees confident that their employer is taking good care of them.

What Are the Essential Performance Management Features?

Businesses tend to look at a solution's performance management features when deciding which HR management platform to adopt. That's because there are various popular methodologies for measuring employee performance. Software makers have created a range of packages to suit business needs. Evaluating employees for bonuses and compensation and crediting them for certifications, as well as skill advancement, are all key features to look for.

Our Editors' Choice winner in this category is SAP SuccessFactors, which did a great job of providing effective mechanisms for assigning and tracking goals, feedback, and coaching, and then examining those criteria during the performance review process. Although it lacks a payroll module, SAP SuccessFactors can effectively communicate employee performance results to your existing payroll system. Data integration should be a key feature no matter what system you wind up choosing, as is the ability to define your own custom workflow for the performance review process. This means the system can use email, document routing, and internal workflow routing to let you design an initial performance review, followed by the right number of subsequent approvals and evaluations necessary in your organization.

The Best Online Learning Platforms for Business

A big part of helping employees do well on performance evaluations is to make sure their skills are up to par by using effective training. Enterprise online learning platforms typically fall into two distinct categories: tools designed for training companies that sell courses to third parties, and tools designed for companies that conduct training with staff. How you plan to use your software determines the type of solution you'll need, how you'll be charged, and the available integrations. Enterprise online learning platforms for training companies tend to offer more flexibility in terms of how much content you can store within the system, how many courses and quizzes you can create, how many separate portals (or dashboards) you can create, and how many people can access your content. Conversely, online learning platforms for enterprises and small businesses that conduct their own internal training tend to offer limited access.

Regardless of the kind of system you'll use, we recommend our Editors' Choice winner in this category, Docebo. With it, you can upload content and develop quizzes based on the information in your files. You can also use a Sharable Content Object Reference Model (SCORM) platform to create more interactive, dynamic courses that combine lessons and quizzes. Most novice technology users will be able to access, use, and master the systems we reviewed with no difficulty.

What Is eLearning Authoring?

To deliver custom training content for use with your online learning and training platform, you'll either need to hire an expert to create such courseware or do it yourself using eLearning authoring tools specific to the task. Before testing systems, you should determine how the content will be delivered to your employees or customers. For example, will your software be installed locally and run exclusively on a specific device? Or will the tool be a cloud-based managed service, making it accessible via a web browser? Cloud-based tools in this category tend to be less expensive and more flexible in terms of who uses the tool and where they'll be using it. You should also set a palatable price. Tools in this field range from free and barebones to thousands of dollars a year for nearly limitless course creation functionality.

After that, it's all about determining your must-have features. All of the tools we review in our roundup, including Editors' Choice winners Articulate Storyline 2 and Trivantis Lectora Inspire, provide basic apps that you should consider must-haves for the eLearning authoring tool you ultimately choose. For example, the ability to include video in training content is a no-brainer. You should look for a tool with drag-and-drop functionality, and a What You See is What You Get (WYSIWYG) editing platform; both of these features improve the speed with which you can create courses.

What Are Scheduling and Shift Planning?

For operations dependent on managing multiple shifts of workers, scheduling and shift planning features are must-have tools. Although this is often done by using dedicated apps separate from the HRMS, there are suites that include this capability, as well. Whether you want to opt for one of those or a dedicated shift planning solution is dependent on the features you need (and possibly whether you can integrate a dedicated solution with your overall HR software platform).

In small operations, shift scheduling is often handled using just a grid built into a spreadsheet. But opting in to a dedicated scheduling solution gives you much greater flexibility than any spreadsheet can provide. The ability to directly tie scheduling into both attendance and payroll is a basic benefit. Still, the ability to provide scheduling across mobile platforms, while allowing shift participants to pick up, drop, or swap shifts without manager or IT intervention, is something you should test to see if it really fits into your day-to-day workflow.

How to Choose the Best HR Software for Your Business

Picking HR software that's best for your small, midsize, or large business depends in part on your size, needs, and budget. Companies that are happy with their existing setups for applicant tracking, onboarding, shift scheduling, or performance reviews might not want or need a core HR platform that includes those options. Other vendors target niche industries or company types.

Zenefits' platform, for example, is especially well-suited to fast-growing, venture capital (VC)-backed start-ups because of its built-in benefits modules for health benefits, employee stock options, and 401(k) retirement savings plans. Established companies that are happy with their existing payroll provider can sign up with Zenefits or BambooHR, which are set up to share payroll data with national processors such as ADP, Gusto (previously ZenPayroll), and Paychex.

Companies with a slightly larger workforce and not a lot of time to spend rolling out new software will appreciate the free data upload service that Cezanne HR provides as part of getting started on its platform. Business owners who want a lot of hand-holding through the setup process can use the many tutorials, setup wizards, and other help functions offered by Cezanne HR, Namely, Sage, or SAP SuccessFactors. If you have employees or offices outside of the United States, you can customize Cezanne HR and Sage Business Cloud People to use specific languages, currencies, or country-specific holidays.

Many HR software platforms have companion Android and iOS apps with a limited number of mobile-friendly functions, such as looking up a co-worker in the company directory or asking for or approving time off. In fact, Namely and Sage Business Cloud People are upgrading their mobile apps to include all or almost all of the functions of their web-based services. A few others still lack apps, but they're working on fixing that. If you're comparing vendors, and giving employees mobile access is important (and it is for many companies), check out a platform's mobile apps before you commit.

For more on business tools, check out The Best CRM Software and The Best Email Marketing Software.