Construction toolsThere will be a time in every startup’s or small firm’s life when it will need to dispense with the random HR data management system of excel spreadsheets, word documents, and other randomly associated files and actually invest in some HR systems and technologies to help streamline the people management processes.

In fact, today’s HR technologies not only streamline and automate much of the HR processes, they help you to manage it more effectively and they are infused with HR knowledge—meaning they also educate you and encourage you to follow HR best practices.

So, when exactly should a startup start moving to an HR system? There’s no simple answer, but I’d say anything from five to 10 people, and if you have remote workers or more than one office I’d say closer to five people as you will soon realize the benefits.

There will naturally always be a question about budget in a startup environment, but have no fear, because at this stage of your career you are unlikely to need the full features of a paid system – and so I’d recommend that you at least start out by trying several of the free HR software tools on the market. And below I have outlined a totally free HR software suite/toolkit for startups and small businesses.

1. Employee Records System

Once you start holding employee data you need to start taking care of it, which means storing work-related personal data on your employees in a centralized, electronic database that is secure and can be easily searched and retrieved by approved staff. There are two free/open source fully featured HR systems on the market you can use for this: WayPoint HR and OrangeHRM.

2. Recruiting System

The underlying administration related to hiring staff can be laborious. However, much of the admin related to hiring can be automated with HR software or an applicant tracking system. These systems can automatically upload resumes to a database (removing lots of boring data entry) as well as rank them for relevance, while some can automatically post to jobs boards and others allow you to automate parts of the client communication process. There are several totally free recruiting systems on the market: Smart RecruitersZoho Recruit, Recruiter box, Podio and Ikrut.

3. Electronic Document Signing Software

Electronic signatures are legally robust and are the most efficient way to sign employee contracts, particularly with companies that have remote employees/candidates in different towns and countries. There are several free electronic signature services available online and the most reputable of these seems to be Echosign by Adobe (free for up to five signatures a month) and Hellosign, which is free for up to three signatures a month and has been positively reviewed by the likes of Forbes, FORTUNE and TechCrunch.

4. Performance Appraisal Software

One of the most effective ways to manage performance in a firm is to conduct performance appraisals. However, gone are the days of carrying out paper-based appraisals as there are a range of free (and paid) performance appraisals software systems on the market, which enable managers and employees to conduct effective appraisals. Waypoint HR, mentioned above, has an appraisal module and Small Improvements is a purpose-built, free appraisal system for small firms (with up to 10 people) used by the likes of Atlassian, Pinterest and Quicksilver.

Of course, you may need some technical help to setup some of these systems, but this is something that a well managed intern or your technical team will do in no time.

All these pieces of software were free at the time of writing, but this may have changed since then, along with the conditions; so, please visit the websites to confirm the actual free/fee status.


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