Essential HR Tools for Every Business

Human resources (HR) tools are software programs used by human resources professionals to help them perform their daily tasks and responsibilities. For example, an HR professional may use specific HR tools to reach out to prospective candidates, onboard new hires, or complete payroll.

According to Fortune Business Insights, the use of HR technology is on the rise, with a market size valued at $40.45 billion in 2024 and the potential to reach $81.84 billion by 2032 [1].

Learn more about essential HR tools, such as talent management systems and human resources information systems (HRIS), and how they may add value to your business.

What are HR tools?

HR tools are programs used to make the role of a human resources professional easier. For busy professionals, human resources tools typically become a worthwhile investment with time-saving benefits. To determine which HR tool is right for you and your business, you may want to consider which features your company values most, such as automated payroll or learning management software. From there, you can explore your options and find HR software that has multiple functions or specifically handles one aspect of human resources.

Do HR tools for small businesses exist?

Yes, you can use human resources software for your small business. In fact, many programs offer subscriptions specifically for small businesses, such as Gusto for beginning HR professionals or BambooHR for performance management.

Human resources tools examples

HR tools serve the purpose of completing automated tasks like tracking an employee’s hours, pay, or performance. As a human resources professional, you may rely on HR tools to select candidates from a pool of applicants, train and onboard them, and ensure each employee receives their correct payment and wages. 

Discover examples of popular HR tools and how they work:

Human resources information system (HRIS)

HR departments frequently rely on a human resources information system, also known as an HRIS, to perform automated tasks like attendance, benefits administration, and payroll. While other HR tools may perform specific functions, an HRIS includes multiple functions in one software program. 

Some of the features of an HRIS include comprehensive data analysis, employee time tracking, and recruitment services. You can choose the right HRIS for your business based on factors like your company needs and the size of your business.

Applicant tracking system (ATS)

When it comes to hiring and onboarding new candidates, you may use an applicant tracking system (ATS) to streamline the process. An ATS can help you find the best candidate for the role by reviewing applications and sorting applicants based on their qualifications. You can program your company’s ATS to look for specific keywords on a candidate’s resume to determine if they meet your needs for the role.

Performance management system

As an HR professional, you may use performance management systems to ensure that employees know their roles and goals within a company and that they meet said goals. These systems can help you track objectives and gather data on individual employees and teams. You can then use that data to give employees feedback on their performance.

Payroll system

A payroll system is an HR tool that ensures that employees receive financial compensation for their work. Not only does a payroll system make sure employees get paid, it also helps businesses operate smoothly and follow all legal labor and payroll requirements. Using payroll software instead of manually completing payroll-related tasks may increase efficiency and accuracy, saving you time and money in the long run.

Time and attendance software

Businesses may invest in time and attendance software to track employee productivity and automatically handle vacation requests. Additionally, HR professionals may use time and attendance software to schedule employees and enable them to trade shifts depending on their preferences.

Learning management software

Companies use learning management software as an HR tool to encourage employees to explore continuous learning experiences. Employees can access learning management software to complete training or courses based on their individual skill sets and knowledge.

Why are HR tools valuable?

Human resources software programs are essential to the success of a human resources department, due to their automation functions that can often enhance productivity and reduce the risk of mistakes from manual data entry work.

Benefits of HR tools

HR tools provide multiple benefits to a company, including increased productivity for HR professionals and user-friendly experiences for employees:

• Increased efficiency: The implementation of HR tools in a company offers professionals the opportunity to increase their efficiency, particularly when it comes to recruiting and onboarding new employees. HR tools make the process of finding qualified candidates quicker and simpler, in part because these tools utilize artificial intelligence (AI) to screen resumes and applications.

• Ensured compliance and regulation: Automated payroll and compliance features take the pressure off human resources professionals and ensure that a company is following all labor laws.

• User-friendly: Many HR tools are user-friendly for both HR professionals and company employees. This allows employees to log in to the HR tool on their own time and access their benefits, pay stubs, and shifts without having to go directly to a human resources professional.

• Cost-effective: When determining the right HR software for you and your business, it’s important to consider the cost. Many HR tools prove to be worth the investment because of the assistance and efficiency they provide within a company and HR department.

• Employee satisfaction: With accessible and easy-to-navigate HR tools, employees can effectively communicate their wants and needs, such as time off requests and schedule changes. Having access to features like employee surveys may lead to happier, more productive employees and an overall positive impact on the workplace culture.

Start a career in human resources with Coursera

HR tools, like talent management systems or payroll and attendance software, help human resources professionals onboard new employees and keep track of valuable company information.

Consider a career in human resources that utilizes common HR tools with the HRCI Human Resources Associate Professional Certificate on Coursera. You’ll have the opportunity to strengthen your understanding of how performance management and feedback impact employee relations in an organization.

HR management professionals can explore the University of Minnesota’s Human Resource Management: HR for People Managers Specialization, where you’ll discover how to apply best practices for hiring and rewarding employees, and for managing employee performance.