What is an HR System?
HR System (Human Resource System)It is a software solution that uses technology to manage human resource processes such as personnel, scheduling, attendance, and payroll. It automates tedious manual operations, helping companies save time, reduce costs, ensure regulatory compliance, and improve operational efficiency.
Simply put, an HR system helps companies handle all matters related to “people”—from employee onboarding, scheduling, attendance to payroll, everything can be done in one system.
Main categories of HR systems
| type | Full name | Core Functions |
| HRIS | Human Resources Information System | Employee data management and basic personnel records |
| HRMS | Human Resource Management System | Covering more HR functions such as payroll and performance management |
| HCM | Human Capital Management | The most comprehensive solution, incorporating talent development and strategic planning. |
| Payroll System | Grain counting system | Focus on payroll calculation, MPF and tax processing |
Why do companies need an HR system?
Five major pain points of traditional Excel management
Many companies still rely on Excel to process personnel data, but this method is no longer sufficient to meet the needs of modern enterprises and faces the following challenges:
- Inefficient, repetitive work:Monthly salary calculation takes 2-5 days, and attendance records and leave management need to be updated manually, making the work tedious and inefficient.
- Prone to errors, high risk:Errors in formulas leading to salary calculation mistakes, failure to update statutory holidays or minimum wage standards, and incorrect MPF calculations may result in fines.
- Data is scattered and difficult to manage.Employee information is scattered across multiple Excel files, resulting in inconsistent versions and difficulty in tracking. Multiple editing by different people may lead to data loss.
- Lack of immediacy:The system cannot provide real-time access to employee attendance records, management cannot quickly obtain labor cost reports, and employees cannot access their pay stubs independently.
- Poor scalabilityAs the company grows, Excel is unable to meet the needs of multiple branches or remote work, nor can it integrate with other systems (such as accounting software).
Which types of companies need an HR system the most?
- Small and medium-sized enterprises (10-200 employees):Smaller companies need automation to reduce the workload of HR.
- Chain retail/restaurant industry:Managing multiple branches and managing high employee turnover necessitates efficient scheduling and attendance functions.
- Fast-growing companies:With a rapid increase in the number of employees, Excel can no longer meet the demand.
- Companies operating under a WFH/hybrid work model:Employees need to access the HR system anytime, anywhere.
Core functions of HR System
Employee data management
- Centralized storage and management of all employee basic information, contracts, and pay history.
- Digitalization of employee files (contracts, educational certificates, identification documents, etc.)
- Supports electronic onboarding processes, reducing paper-based processing.
Scheduling and Attendance Management
- Multiple check-in methods (GPS location, Bluetooth check-in, facial recognition, etc.) prevent proxy check-in
- Shift schedules are generated on demand (supporting shift work and flexible working hours).
- Real-time tracking of employee attendance records and overtime hours.
- View your remaining vacation days in real time (annual leave, sick leave, personal leave, etc.), and apply and approve online.
Strong compensation management
- Automatically acquires attendance/leave data and tracks ADW in real time.
- Automatically calculates salary, including holiday pay, attendance bonus, overtime pay, etc.
- Supports various salary systems including monthly, daily, and hourly wages.
- Automatically generate payment slips and MPF contribution reports.
- Complies with Hong Kong’s Employment Ordinance (418/468/713) and Mandatory Provident Fund (MPF) regulations.
Reports and Analysis
- It offers flexible reporting capabilities, supports data visualization dashboards, and can perform data analysis such as payroll costs and employee turnover rates, providing more accurate decision support for enterprise management.
Employee self-service
- Employees can use a mobile app to check pay slips, apply for overtime leave, etc., reducing the administrative burden on the HR department and improving employee satisfaction.
HR digitalization is key to enterprise transformation
As businesses grow and face challenges such as technological advancements and organizational development, traditional methods of managing personnel information using Excel or paper-based systems are no longer sufficient to meet the needs of modern enterprises. Digital transformation of HR has become an essential path for Hong Kong companies to enhance their competitiveness.
The Transformation from Excel to HR System
Currently, many companies in Hong Kong still rely on Excel to manage personnel data. However, as businesses grow, the limitations of Excel are becoming increasingly apparent, posing growing challenges to business operations.
- Data is prone to errors:Manually entered data is difficult to keep consistent, and modification records are difficult to track.
- Low collaboration efficiency:Excel files cannot be edited by multiple people simultaneously, making the collaboration process cumbersome.
- Lack of automation capabilities:The monthly salary calculation process is time-consuming, error-prone, and cannot effectively handle complex situations.
- Difficulty in generating reports:Excel cannot generate data reports in real time, causing decision-making to rely on manual data organization and analysis.
Enterprise digitalization results (value realization)
After HR is digitized, companies can
Improve efficiency
- Grain counting time:The traditional 3 days have been reduced to just 2 hours.
- Attendance Management:Automated attendance processing saves up to 90% of time.
- Holiday approval:The average processing time has been reduced from 2 days to instant approval.
- MPF Report: Automatically generates MPF reports, saving 100% of your time.
Cost saving
- HR personnel costs: Save 30% on HR personnel costs.
- Paper and printing costs: Reduce paper and printing expenses by 90%.
- Human error cost: Due to automated calculations and processes, the additional cost of human error is reduced by 95%.
Improve employee satisfaction
- Employees can view their payslips anytime via their mobile phones.
- The application and approval process for holidays has become more immediate and transparent.
- Vacation balance and personal profiles can be easily updated, enhancing employee engagement and satisfaction.
Optimize decision-making with HR Analytics
Churn rate analysis
- Which departments or positions have the highest turnover rates?
- What are the main time points when employees leave a company?
- Is employee turnover rate related to salary levels or other factors?
Salary cost optimization
- Are a company’s salary expenditures linked to performance?
- Overtime cost analysis: Which departments have higher overtime costs?
- Comparison of per capita output across different stores provides a basis for salary adjustments.
How to choose a suitable HR system?
When selecting an HR system, it is recommended to evaluate it from the following perspectives:
| Evaluation Project | Key considerations |
| Functional matching | Does the system’s functionality meet the company’s actual needs? Are there any redundant functions that waste resources? |
| Localization level | Does it support Hong Kong regulations? Does it automatically process MPF, IR56B, and labor laws? |
| Ease of use | Is the interface intuitive? Are it easy for employees and HR to use? |
| Data security | Does it have ISO certification? What are the data encryption and backup measures in place? |
| Customer Support | Does the company have a professional technical support team? How fast is their response time? |
| Price transparency | Is the pricing model clear? Are there any hidden charges? |
Top 10 HR Systems in Hong Kong by 2025
The following is a comparison of popular HR System vendors in the Hong Kong market in 2025 to help you find the most suitable solution:
| HR system | Suitable for businesses | Main functions | Pricing Model | feature |
| Workstem | From SMEs to large enterprises | One-stop HR + Payroll | Monthly fee per person | Hong Kong localization is the first choice |
| Talenox | Startup/Small | Basic HR + Payroll | Free to Paid | Entry-level selection |
| HRPro | medium-sized enterprises | Comprehensive HR Management | Quotation system | Full-featured |
| JustLogin | SMEs | HR + Attendance | Monthly fee per person | Strong attendance function |
| YOOO | SMEs | HR+Payroll | Monthly fee per person | Local development |
| Info-Tech | Medium and large | HR+Payroll | Quotation system | Established supplier |
| Workday | Large/Multinational | Enterprise-level HCM | Quotation system | Internationalization plan |
| BambooHR | SMEs | HR Data Management | Monthly fee per person | User-friendly interface |
| Kingdee | Medium and large | ERP+HR | Quotation system | China’s top choice |
| ADP | Large/Multinational | Global Payroll | Quotation system | Applicable to multinational corporations |
Common HR System Issues
Q: What problems can the HR System help solve?
A: The HR system can effectively solve problems such as manual management, erroneous calculations, and cumbersome employee data management. It can simplify workflows and improve efficiency, allowing HR to focus on more valuable work.
Q: Does the HR system support multiple languages?
A: Most HR systems support multiple languages and have Chinese and English versions, making them suitable for companies in multilingual environments.
Q: How does the HR system ensure data security?
A: A proper HR system will provide ISO 27001 cybersecurity certification, encrypt data, back it up regularly, and have role-based access control to ensure the security of employee information.
Q: Can the HR System be integrated with other systems?
A: Most HR systems provide API interfaces, which can be integrated with other enterprise management systems such as accounting software and ERP systems to achieve data sharing and process automation.
Q: What happens to the HR system if an employee leaves?
A: When an employee leaves the company, the HR system will set them to an inactive status and stop billing, but the data will be retained for future query or management.
Start your HR digitalization journey now
If your company is still using Excel to manage human resources, or if your existing on-premises system can no longer meet your needs, now is the best time to transform.
Workstem is Hong Kong’s leading one-stop cloud-based human resources and payroll management system. Since our inception, we have served over 2,000 companies across various industries, including retail, catering, property management, education, and healthcare.
Further Reading
To help you gain a deeper understanding of HR systems and the digitalization of human resources, we have compiled the following extended reading resources, categorized by topic:
HR System Selection Guide
- How to choose a human resource management system (Payroll & HR system)?
- How to Choose a Payroll & HRM System?
- Payroll & HR System VS Excel
Function Details
Digital Transformation in Practice
- Do You Really Save That Much with HR Systems?
- 5 Manual HR Functions That Digital Technologies Can Resolve
HR professional knowledge base
- Complete Guide to Hong Kong Employment Ordinance
- MPF (Mandatory Provident Fund) Complete Guide
- How to handle employee attendance issues?
Industry Special Report
- HR Management Guide for Retail Chains
- A Complete Guide to Salary Calculation in the Catering Industry
- Human resource management in the construction industry
Workstem User Guide
Customer success stories
Workstem Customer Success Stories
How F&B stores solve scheduling challenges
HR Terminology
Download Utility Tools
Weekly work schedule, MPF payment settlement statement, IR56B, etc.