What Is an HR System of Record, and How Do You Create One?

It’s hard to imagine today, but there was a time when we didn’t talk much about company culture or its impact on an organization or people. And it wasn’t all that long ago. Then, somewhere in the early aughts, a few visionary HR leaders at influential companies began to double down on supporting the workplace and the people who inhabit it by focusing on culture. Lazlo Block, the former head of People Operations at Google, was one of them. Credited with first coining the phrase People Operations, Block saw the connection between driving company culture and organizational success. And today, People Operations — the people-centric business approach to decisions that focuses on maximizing results and optimizing workforce productivity by making work engaging — is the outgrowth of traditional HR at the most future-facing companies.

Creating an HR system of record is the first step to automating HR tasks.

But to shift away from HR and toward People Ops, businesses must rethink how some of the most fundamental tasks of the function are handled. Creating an HR system of record is one of the first steps.

Power People Ops by automating HR

HR is responsible for maintaining records of some of the most vital components of the business, like:

• Recruiting and hiring
• Onboarding
• Payroll
• Benefits

Yet without the right tools in place, filing forms, updating sheets, and storing records manually is burdensome and tedious work. The good news is that these tasks can be easily automated with technology. An HR system of record is a complete digital warehouse that stores the employee record for every member of the organization, including full-time employees, part-time employees, and contingent workers. With an HR system of record in place, HR can begin to focus on what really matters — your people!

Start by creating digital employee records

An HR system of record is the backbone of automating the rest of your HR tasks and starts with the employee record. Employee records are updated and maintained by employees, decentrally, but stored in the centralized system. This enables People Ops to:

1. Digitize the org chart

Since employee records are maintained by each employee with updates pushed in real-time, the business will always have an up-to-date org chart with the correct contact information, like personal email addresses, phone numbers, and job titles. This makes it easy for employees to quickly figure out who’s who and reach out with ease.

2. Centralize employee documents and e-signatures in the cloud

Use a system like DocuSign to easily collect signatures from all parties.

An HR system of record allows HR to easily manage documents from the cloud. It acts as a central repository for all the most important employee-centric company information like:

• Confidentiality agreements
• Employee handbook
• Policy updates

The right system will allow administrators to select which employees need to receive what information and then send the documents automatically. You’ll also be able to collect approvals and e-signatures and store them securely. Since employees will be able to access company policies easily, they’ll always be in the know, thus preventing litigation.

3. Manage permissions with care

HR data is some of the most sensitive and important data in the company. It’s HR’s responsibility — and legal obligation — to securely store and protect this information. When setting permissions for your HR system of record, do so prudently. The best practice is only to provide as much access as people genuinely need. A good rule of thumb to follow is:

• Administrators: HR leaders, C-level executives, board members, accounting team members, and auditors
• Editors: Managers
• Users: Employees

Then automate hiring and onboarding

Offload the HR tasks that can be automated so your team can focus on what really matters — engaging candidates, new hires, and employees.

Use an HR system of record to streamline and automate HR tasks required for hiring and onboarding.

Since you’ve already built or purchased an HR system of record, you can use it to streamline HR tasks and outsource manual actions to the system or new hires.

Templates can make it easy to automate hiring

Consider creating them for:

• Offer letters: Write it once, use it forever. Create a template and use the customizable fields of your HR system to populate employee-specific details, like name, job title, start date, hiring manager, and starting salary.
• Confidentiality agreements: Employees with access to specific data may need to sign confidentiality agreements or NDAs. Create a company template that makes it easy to plug-and-play individual details.

Automate the process further by sending them through the system and collecting e-signatures.

Automate onboarding by building an onboarding flow

Technology makes it easy to create a repeatable onboarding flow for all your employee types — full-time, part-time, contractor, and contingent worker. This looks different for each company but will likely include:

• Completing new hire paperwork
• Signing employee documents
• Filing in the personal details of their digital employee record
• Familiarizing themselves with certain aspects of the business

HR system of records improve efficiency

With HR technology, like an employee system of record, your HR and People Operations teams can automate the day-to-day minutiae and free up time for what really matters — your people.