The 7 best HR software and tool options to consider in 2023
The odds are good your HR shortlist will have some of these well-regarded products on it. Here are the pros and cons of each and advice on setting up a winning buying strategy.
The market for HR software is vast and has something for businesses of every type and size. The key is finding the system that best addresses your priorities and requirements.
The seven vendors included in this list of the best HR software offer comprehensive human capital management suites that are suitable for both mid-market and large organizations that prefer an all-in-one system. These products include core HR (employee records, payroll and benefits), talent management (recruiting, learning, performance and compensation management and succession planning) and other essential HR tools.
When evaluating vendors, it's important to remember that each module in an HCM suite may not be as feature rich as the other modules. For example, one vendor may emphasize the recruiting function while another focuses on performance management. Some vendors may have acquired other vendors to enhance their own HR software offerings, which can lead to differences in the user experience from one module to the next.
While no one can claim to know what software is best without testing all of the contenders, it is possible to identify the leading vendors by consulting analyst rankings and other credible sources. The vendors who made this list are all well regarded in the HR technology market and consistently appear in the leader sections of ratings reports from Gartner and Nucleus Research, user adoption surveys from Sierra-Cedar and market studies by the Josh Bersin Company.
The products named here are each vendor's flagship or most current HCM suite. All are highly configurable and offer key features and HR tools to support complex needs. All the systems are delivered in the cloud via software as a service, relieving your IT team of the responsibility of maintaining the hardware and software. They are listed in alphabetical order.
1. ADP Workforce Now
ADP was founded in 1949 and is best known as a payroll provider, but it also sells a comprehensive human resource information system that offers a full suite of functions. ADP caters to all business sizes, from the very small all the way to multinational conglomerates. It also offers a service that allows you to outsource payroll processing to ADP payroll specialists.
- For companies with offices in the United States and Canada, ADP offers a cross-border system that allows you to store all employee records in one database. The data is easily accessible for reporting, viewing and managing workflow approvals.
- It has decades of experience in the payroll field.
- It has done a good job of building software that is easy to use for employees, managers and HR.
- There is a marketplace of certified partner applications that you can integrate with ADP Workforce Now to supplement its functions.
- A drag-and-drop reporting tool simplifies the process of creating new reports.
- When first looking at the ADP website, you may find that it's not very easy to identify which product is right for your company.
- ADP has made progress in making a staging and test environment available to customers but does not yet offer it as a standard feature like many HR software providers do.
- The software is not as feature rich as products from some of the other vendors on the list.
Why you should consider ADP Workforce Now:
- ADP has invested heavily in Workforce Now over the past few years.
- It is a stable company with a proven track record.
2. Ceridian Dayforce
The Dayforce suite competes directly with ADP Workforce Now, especially in payroll and benefits administration. Ceridian has offered a payroll system that supports multiple countries for many years now, continues to seek input from customers on how to improve the platform and has invested heavily in adding support for additional countries.
- Dayforce Wallet eliminates the long-held requirement to be paid on a regular schedule. With Wallet, employees can receive their pay a little at a time throughout the pay cycle, based on their organization's rules.
- Ceridian has perfected the process of refreshing your staging and test environment.
- The software is not overly complex to administer after go-live.
- Payroll integrates well with Dayforce's time and attendance functions and simplifies making last-minute adjustments.
- The user interface is not as appealing as those of other vendors.
- The security model can be confusing, which is in part caused by Ceridian using common HR language, such as "department" or "division," in a nonstandard manner. On the other hand, it's easy to make minor adjustments to security roles.
- The platform does not offer the same depth of functionality as some others listed here.
Why you should consider Ceridian Dayforce:
- Payroll module supports last-minute changes with ease.
- It has an integrated platform.
- Refreshing the test and staging area is easy.
3. Oracle Cloud HCM
Oracle built Oracle Cloud HCM internally, rather than through acquisitions, which allows for a consistent look and feel for both employees and HR administrators. Like SAP, Oracle is a dominant player in the software industry, with significant financial resources to continue investing in HR software. As with SAP, Oracle offers a full suite of functions in a highly configurable system.
- You can configure the software to support complex business rules.
- Technical support is very responsive.
- Many training options are available for free to customers.
- The software is built with a responsive web design, eliminating the need to install apps on mobile devices.
- Oracle offers additional cloud products you can use to manage all aspects of your business, such as HR helpdesk software and ERP, that are integrated well with the HCM.
- Reporting can be complex, and knowing SQL is recommended for advanced reporting.
- Configuration changes can be complicated and may present a steep learning curve for new system administrators.
- The file format for data uploads is not intuitive and adds complexity when migrating data.
- Department names must be unique, which can present a challenge when you have multiple operating groups with similar departments, such as finance.
Why you should consider Oracle Cloud HCM:
- Oracle has the funds to continue investing in the HCM suite and related HR tools.
- The system is very configurable.
- A full suite of integrated modules is available to support other business needs.
Paycor offers a suite of HR features to automate the entire HR process, including a pulse survey tool to keep in touch with employees and build employee engagement. While Paycor supports large enterprises (often defined as companies with 1,000 or more employees), most of its installed base is at smaller organizations. The HR software is tailored to work in seven verticals, such as healthcare, manufacturing and nonprofits. Paycor focuses on American organizations with full payroll and government reporting features.
- It has a full suite of modules to support the HR team, payroll and employees.
- The software was built entirely by Paycor and therefore has a consolidated database.
- Simple configuration options make it easier to maintain the system as changes are required.
- Offerings are tailored to customer size and vertical.
- Reporting pulls data from a single database and allows you to quickly drill into the data behind charts and graphs.
- It only targets customers with employees in the U.S.
- It has fewer configuration options than other vendors on the list.
- While Paycor offers many modules and features, its offering is not as comprehensive as other vendors'.
Why you should consider Paycor:
- It's an all-in-one system that could meet your HR needs.
- Midsized businesses with less-complex requirements can avoid the challenges of administering one of the larger systems.
- You can integrate third-party software to fill gaps in functionality if needed.
5. SAP SuccessFactors Human Experience Management (HXM) Suite
SAP SuccessFactors was a major player in the early days of SaaS HCM. Following its acquisition by SAP in 2012, SuccessFactors benefitted from renewed investment because it became SAP's main HR offering, replacing an on-premises system. SAP SuccessFactors HXM is a highly configurable, comprehensive suite. Users see a consistent look and feel, which is important since many of SuccessFactors' modules were acquired over time.
- The comprehensive system covers everything companies need from an HR perspective.
- It offers advanced reporting.
- SAP is committed to continued investment and innovation to improve the software.
- It has an appealing look and feel.
- It supports country-specific languages and payroll rules for many countries around the world.
- Many modules were acquired and only partially integrated. While most of this is hidden from users, the system administrator will have to learn how to use different systems when making configuration and permission changes.
- As with any highly configurable HR application, it can be more challenging to make configuration changes.
- When using acquired modules, the data is stored in multiple databases, which makes reporting more challenging.
Why you should consider SAP SuccessFactors HXM:
- The product is offered by one of the biggest software vendors in the world, which has the resources to continue investing in the software.
- The system is highly configurable, which makes it possible to meet complex business needs. There are features that cater to the needs of global companies.
6. UKG Pro
UKG was formed by the merger of Ultimate Software and Kronos in April 2020. While there was some functional overlap, the addition of Kronos' Time and Attendance features to Ultimate's HR software has provided the combined company with a solid feature set. However, because of the merger, there are two databases, one to store time and attendance data and one for all other employee data. UKG continues to be one of the top-performing HR software vendors, and as it continues to integrate the two product lines, the offering will only improve.
- The combined company offers a comprehensive HR system with advanced timesheet functionality from the Kronos side of the merger.
- Transferring time and attendance data from one system to the other has been simplified.
- The interface is user-friendly.
- UKG continues to invest heavily in new features, such as AI and machine learning.
- The software can be configured to meet unique business needs.
- Data is split between two databases.
- Configuration changes have to be made in two systems.
- While the software supports many languages, it does not have the same breadth as products from some of the other large vendors.
- The training provided by UKG is still housed in two different locations.
Why you should consider UKG:
- It includes a full suite of HR functions.
- It offers an advanced time-tracking application.
- It has a modern user interface.
7. Workday Human Capital Management
Workday was founded in 2005 with the goal of building a cloud-based HR and finance system. One of the founders previously started PeopleSoft in 1987, which went on to become one of the top-rated on-premises HR systems. Workday's HCM system serves a global customer base with feature-rich applications. Like Oracle and SAP, Workday's HR software provides an end-to-end system for companies looking to automate the whole employee lifecycle, including payroll.
- It includes a full suite of HR functions.
- Flexible configuration options enable companies to meet global needs.
- The company continues to invest in AI and ML.
- Reporting and analytics features are top-rated.
- Workday built its system from the ground up, providing users with a consistent look and feel, a single database and one security model.
- The learning management system requires continued investment to compete on an equal footing with competitors.
- Workday continues to build up its presence in the Asia-Pacific region, which had been lacking, both in terms of internationalizing the software itself and building a network of certified partners.
- The user interface feels out of date compared to some competitors.
Why you should consider Workday Human Capital Management:
- It offers leadership with a long history of success in HR software.
- A large installed base will ensure the company has the funds to continue investing in new, innovative software.
- The system was built internally rather than through acquisitions.
- The company has an impressive customer list including Walmart, which has approximately 2 million employees worldwide.
General HR software buying considerations
HR software selection and implementation is a large undertaking that involves a substantial commitment in resources by an organization. Early in the project, you will want to consider the following points to validate your needs, build a business case and zero in on the right vendors:
- Build a requirements document.
- Understand your budget, both for annual software licenses and the implementation itself.
- Form a project team that includes members from key stakeholder groups, such as HR, IT, finance and legal.
- Before scheduling a demo, make sure the vendors know what your needs are and what is most important to your organization.
- Keep in mind that often, the more expensive applications come with higher implementation and consulting fees.
Features to look for when buying HR software
While each company is unique, when it comes to buying HR software, you may want to consider the following points:
- Whether the application supports each region where you have employees. That means, for example, ensuring the user interface is translated into local languages and payroll adheres to local tax laws.
- Reporting and dashboards continue to gain in importance. Take a close look at the product's standard reports and dashboards and try to understand how easy or difficult it will be to build your own.
- You may require integrations with other applications that rely on your current HR software. This may be payroll, finance or other systems managed by IT.
- Mobile features are important. Determine if an app is required to access the HR software remotely and whether it supports the types of devices used in your organization.
- Consider whether the software has enough breadth to support your organization as it grows.