Is an HRIS compensation module enough for effective compensation management? 

If your HRIS already handles payroll, performance, and reviews, it’s tempting to manage compensation there too. But convenience often comes at the cost of accuracy, insight, and control.

There are good reasons why teams use HRIS for compensation management, such as:

• Budget: Benchmarking data is often bundled with the HRIS add-on. For instance, HiBob’s compensation module includes Mercer Comptryx data.
• One-tool simplicity: Using a compensation module centralises performance, finance, and goals data in a familiar system. 
• Customisation: It feels easier to tailor since it already connects to existing approval workflows.

But here’s the thing: an HRIS compensation add-on can only support basic compensation planning.

It typically relies on outdated benchmarks, offers limited peer segmentation, and lacks advanced tools – like dynamic salary bands and scenario modelling – that growing teams need for fair, competitive, data-driven pay decisions.

HRIS compensation modules are also difficult to use. For example, there’s no benchmarking platform to map the third-party survey data they offer to your internal job roles and use it for internal compensation processes like salary bands or comp reviews – essentially making the data unusable.   

This guide walks you through how to choose between an HRIS compensation module and specialised compensation software. You’ll learn:

• What HRIS compensation modules offer and where they fall short
• What dedicated compensation software helps you do differently
• How to decide (or combine both) for a setup that balances efficiency and depth. 

What is HRIS compensation?

HRIS compensation is an add-on module within your Human Resource Information System (HRIS) that helps you make salary decisions using the employee data your system already holds. It typically draws from:

• Employee profiles (e.g., job title, location, level, and salary)
• Payroll transactions like bonuses and pay history (when connected to your HRIS payroll module)
• Performance reviews and tenure data (when tracked in your HRIS or integrated from your performance system. 

By automatically pulling everything directly from your HRIS, the module reduces manual work. But it also means your compensation planning insights are limited to internal data, with no built-in market benchmarks for comparison.

To bridge that gap, some HRIS compensation modules let you upload salary survey data, and some like Hibob compensation also integrate with third-party salary data providers like Mercer.

The downside to using third-party traditional salary survey data is that they tend to be error-prone and update typically annually rather than in real-time, making benchmarks unreliable. 

It’s also difficult to use said data. Hibob compensation add-on, for instance, lets you download third-party Mercer Comptryx data with a PDF containing descriptions of job levels. But there’s no salary benchmarking platform to map that data to your internal job roles or use the data for your internal comp processes like bands or compensation reviews.

 As a result, managing compensation in your HRIS can work well for administering straightforward merit cycles and tracking pay changes, but is less effective for competitive compensation benchmarking or strategic planning – both essential for fast-growing companies aiming to stay market-aligned and retain talent. 

What is compensation software? 

Compensation management software is a dedicated platform designed to help companies create, manage, and optimise pay strategies, beyond what HRIS compensation modules help with.

Many of these platforms connect with your HRIS to combine live employee data with real-time market benchmarks, giving you an up-to-date view of how salaries, bonuses, and equity compare across roles, levels, and locations.

Building on that data foundation, modern compensation software like Ravio also provide advanced compensation workflow tools such as dynamic salary band creation and pay equity analysis.

These features let teams model different scenarios, maintain pay equity, and make fair, data-driven decisions – all in one place, without relying on spreadsheets.

Put simply, specialised compensation software helps companies move beyond administrative pay planning and turn compensation into a strategic advantage – keeping high-growth, global teams competitive, compliant, and market-aligned.

HRIS compensation vs dedicated compensation management software [at a glance] 

HRIS compensation modules offer the benefit of integration across HR functions, but they’re designed to support broad HR administration. In contrast, dedicated compensation software is built specifically for strategic compensation planning.

It’s the difference between getting Japanese food at a buffet and going to a Japanese restaurant: the first is broad, the second is built for depth.

The table below shows how that difference plays out in practice, with a detailed breakdown following it in the next section: 

When is HRIS compensation not enough? 3 reasons why HRIS falls short

The moment compensation planning needs to go beyond basic salary adjustments, the limits of an HRIS compensation module start to show.

The challenge is that HRIS platforms are designed to support broad people operations. Their compensation modules aren’t built for the depth, accuracy, and flexibility required to run competitive compensation programs. 

That’s why HRIS compensation typically falls short in three key areas:

1. Limited and outdated market benchmarks

HRIS compensation modules use your internal employee data to help you make salary decisions. For external benchmarks, they either let you manually upload compensation benchmarks you buy separately or give you third-party benchmarks (commonly from Mercer). 

The problem here is that most third-party providers typically offer broad and outdated benchmarks – meaning you end up making compensation decisions from historical snapshots rather than a real-time view of how the market is moving and whether your pay ranges are still competitive.

Additionally, HRIS tools don’t usually offer the level of peer segmentation People teams need – such as filtering by company stage, headcount, funding round, or industry. Without that context, comparisons can end up too broad to reflect your actual talent market. 

The result is a benchmark view that may look precise on the surface, but still feels “off” when managers question it, candidates push back, or finance asks for justification. And without current, contextual data, it’s harder to defend ranges or show pay equity alignment, which introduces both retention and compliance risks.

2. Poor functionality that makes benchmarks unusable

Essentially, HRIS platforms are broad HR software, so they don’t give you a benchmarking platform to map the third-party data to your internal job roles. 

You also have to manually import and create salary bands with limited to no vendor support. And because these salary bands aren’t tied to real-time market data, they quickly become outdated. So if you run a promotion cycle, for example, you’ll need to manually update ranges and confirm the right salary band each time rather than seeing those adjustments happen automatically.

The result? Salary bands remain static rather than market-responsive. You also can't use them within your compensation workflow tools or reviews since you need real-time benchmarks in the review process to inform which employees should receive a market adjustment.

3. Limited workflow flexibility 

Because HRIS compensation modules are built for administrative consistency, not compensation nuance, they often can’t support real-world pay structures centered around multiple bonus types, equity components, variable pay, and cross-region pay rules.

As a workaround, teams end up relying on spreadsheets and manual steps for core structures like salary bands or complex processes like pay equity analysis or running a customised compensation review. 

Altogether, this slows compensation cycle reviews, requires more manual oversight, and makes it harder for you to defend pay decisions – especially when they need to be explained to managers, leadership stakeholders, or employees.

3 reasons to consider a dedicated compensation management software

HRIS compensation works well when your pay structures are simple and stable – meaning salaries don’t vary much by role, region, performance plan, or equity mix.

In those cases, using HRIS for compensation management can help you administer pay changes smoothly and keep basic records consistent.

HRIS compensation is also enough if your priority is cost control. In that case, it can be more cost-efficient to purchase an add-on to a software you already use, especially if the cost includes third-party benchmarks (for example, Mercer via HiBob). However, be mindful that the benchmarking data often comes at an additional cost.

The major trade-off to be mindful of, though, is that the salary benchmarks are refreshed infrequently, so they don’t reflect current market movement.

Put simply, HRIS compensation has limits, and those limits surface quickly once compensation becomes strategic, not just administrative.

 In fact, HRIS modules start to fall short as soon as compensation decisions involve multiple stakeholders and the emphasis shifts from just calculating pay to explaining and defending it, staying competitive, and maintaining pay equity compliance.

Meaning, a HRIS compensation module is typically not enough when:

1. You need real-time, context-specific total compensation benchmarks (filtered by company stage, size, sector, or funding round), rather than annual survey snapshots or generic pay ranges.
2. Your compensation structure varies across roles, regions, or pay components (e.g., salary, variable pay, equity, benefits), and your HRIS can’t support representing all the planning complexity without spreadsheets.
3. You need to model scenarios before making decisions – such as adjusting raise budgets or bonus pools and understanding cost and pay equity impact across your organisation. 
4. Your compensation processes involve many stakeholders. HRIS compensation modules often have limited workflow flexibility and basic user permissions, making it harder to run and defend core processes like benchmarking or compensation reviews.

What does a dedicated compensation software offer that an HRIS compensation add-on doesn’t? 

If your goal is to build fair, competitive, and scalable compensation structures, you’ll need a tool designed specifically for strategic pay planning. 

To that end, here’s how dedicated compensation software deliver the data depth, modelling capabilities, and workflow control that HRIS modules can’t support:

1. Real-time market benchmarks for competitive compensation

Unlike HRIS compensation modules that rely mostly on internal employee data and third-party benchmarking data, dedicated compensation software offers real-time, peer-relevant market data (global or region-specific).

Compensation management software Ravio, for example, sources accurate global market data across total rewards (salary, variable pay, equity, benefits) directly from 1,400+ companies via HRIS and ATS integrations. You can also import third-party data if needed.

What’s more, certain specialised software also support job mapping. At Ravio, for instance, the team helps level your employees into the Ravio dataset upon onboarding. This way, your benchmarks are comparable – Head of Engineering mapped against the right benchmark, not to the CTO data, for instance.  

All in all, this makes sure your benchmarks are both up-to-date and relevant to your hiring market. In turn, helping you make competitive, market-aligned compensation decisions across job roles, levels, and locations. That level of accuracy also makes it easier to explain and defend pay ranges.

2. Tailored, end-to-end compensation workflows for faster, fairer compensation decisions

HRIS compensation modules tend to follow a one-size-fits-all approval path and static pay structures – which works when compensation is simple, but breaks down once pay varies by role, region, or component (e.g., bonus, equity, variable pay).

Dedicated compensation platforms, on the other hand, support the full decision-making process, all tied to reliable market data:

• Create and update compensation bands in line with live market benchmarks so your ranges stay up-to-date, competitive, and in-line with your compensation philosophy – never static.
• Identify pay gaps, calculate remediation costs, and generate compliance reports to maintain pay equity and meet regulatory requirements.
• Model compensation budgets, bonus pools, and equity allocations to instantly see cost and pay-equity impact before you roll anything out.

This brings all compensation decisions into one dedicated platform – reducing manual coordination, improving transparency, and helping teams make faster, fairer decisions while staying confident in the reasoning behind them.

3. User-friendly interface for easier adoption

Compensation management isn’t an HRIS’s core focus, so its compensation modules tend to feel clunky and less intuitive. 

One HiBob user, for example, shares there are “occasional UX quirks” in the platform, and a Workday user notes, “the layout and format of the website and application are tricky at best.”

Dedicated compensation software, on the other hand, is built specifically for compensation planning – making it far more user-friendly and easier to navigate.

Ravio users, for instance, say the platform is “easy to use and very helpful,” while others recommend it as a “simple but very effective tool” that “you probably don't understand quite how much time [it has] saved us.”

You can see context like pay ranges, compa ratios, guidelines, and notes directly within the compensation review workflow. Automated features like Ravio’s automated job mapping make setup intuitive too – reducing the manual spreadsheet work of matching and updating roles to benchmarks.

The result is less back-and-forth, easier adoption, and more consistent decision-making across teams.  

Ravio vs HiBob vs Workday HRIS compensation

Finally, as we wrap this up, let’s take you through a showdown between Ravio, specialised compensation management software, and two HRIS compensation modules, HiBob and Workday. 

You can also dig through other compensation management software here. Let’s get on with a quick overview now, followed by the details: 

HiBob's compensation module

HiBob is a broad HR platform with tools for performance management, payroll management, and basic compensation management available as add-ons.

Because it’s built for wide HR functionality, HiBob’s compensation module lacks the flexibility and depth that growing and large teams need.

Users also often note the compensation module “still has a long way to go before it can fully support complex pay structures and processes.”

What’s more, salary band creation is manual. Benchmarking data is also outdated and prone to errors because HiBob relies on Mercer Comptryx, a salary survey dataset that is reported to be updated quarterly, not continuously.  

The main upsides are convenience and easy customisation. 

You can make compensation decisions within a tool you’re already familiar with, and tailor it easily since the platform already includes your goals, performance, and finance approvals.

HiBob's compensation add-on setup

For a simple compensation structure, the module’s setup for HiBob users is moderately simple for HR administrators.

However, if you hire globally in multiple currencies and offer custom pay components, you’ll likely need external or vendor implementation support to map job levels, import data, and train managers. 

Who is HiBob's compensation module ideal for?

Given its basic compensation management features, HiBob compensation is ideal for SMBs with simple compensation needs that want to manage pay decisions directly within their HR platform.

Workday's compensation module

Workday is another broad HR platform that supports deep integration across compensation, performance, talent management, and succession planning.

Like HiBob, it offers basic compensation management tools with manual band creation, no live view of how pay changes affect budgets during cycles, and third-party benchmarking via Carta.

Compared to HiBob’s Mercer integration, Workday’s Carta partnership offers real-time data, but the dataset is limited to privately held startups in the US.

Additionally, as a cap table management platform first, Carta’s strength lies in equity benchmarking, while its salary data is less robust. It also lacks live market trends, competitive intelligence, or hiring rate insights – all essential for modern compensation decisions.

Users also report unintuitive navigation with one saying, “​​The layout isn’t always intuitive, and you sometimes have to click through several menus just to complete a simple task.”

Workday's compensation add-on setup

Workday compensation implementation is highly technical and time-consuming, requiring vendor support or an internal HCM team, with deployment timelines of 3-6 months.

Users repeatedly note “costs” and “implementation time” as the biggest shortcomings.

Who is Workday's compensation module ideal for?

Because its setup and upkeep are complex and require dedicated resources, Workday compensation is ideal for large global enterprises looking to connect HR, finance, and talent management in one platform.

Ravio's compensation management software

Ravio is a specialised compensation management software that gives you advanced compensation review tools with verified, real-time salary and total rewards benchmarks covering base salary, variable pay, equity, and employee benefits.

Compensation workflow tools include salary bands, pay equity analysis, and compensation reviews with fast onboarding, automated job mapping, and an intuitive interface.

One user goes on to say, “Great platform. Biggest wins are: [It] easily integrates with our HRIS, so readily checks and updates our starters and leavers. [And] automatically puts our people into the correct job families (there were a very small number of manual amends).” 

Ravio integration with your HRIS

Ravio integrates with 100+ HRIS systems, including HiBob, which can be a time saver according to the Tiqets’ team that uses them together:

On your end, you’ll need to set up the integration within your HRIS to bring your employee data into Ravio. Our onboarding team supports this process and helps match your job levels to our framework for consistent, like-for-like comparisons.

This user explains the process best:

“Ravio is very user-friendly and easy to implement. You just integrate the system with your HR system, and the team then matches up the roles with what they suspect the right leveling is. After that, I just had to confirm/edit on the system.

It is great to finally have insights into tech companies rather than just very broad corporates. I've also had great customer service at all times, and everyone I dealt with from Ravio has been super helpful, knowledgeable, and quick in responding. I also like that you get insights into benefits.” 

Who is Ravio ideal for?

Ravio is ideal for high-growth, global tech companies that need structured pay frameworks, relevant, reliable, and real-time market benchmarks, and advanced compensation tools to manage complex pay mixes – from base salary to bonuses, equity, and variable pay. 

The best part? Ravio offers a 30-day free trial so you can easily evaluate the software and see if the data fits your needs (for companies with 100+ employees only). 

HRIS compensation vs. dedicated software: How to decide what’s right for your company?

Choosing between an HRIS compensation module and a specialised compensation platform depends on how complex your pay-planning needs are.

On the surface, adding a compensation module makes budgetary sense and keeps setup simple since it already connects to your employee data, goals, performance, and finance data.

But beyond that, all-in-one HR systems typically don’t support strategic compensation planning – like building salary frameworks, modelling pay scenarios, or benchmarking in real time across roles and locations. It also doesn’t automate job mapping, salary band refreshes, or compensation recommendation logic – all of which are typically built into specialised compensation platforms like Ravio. 

That said, here are five factors to weigh as you choose between an HRIS compensation add-on and specialised software:

• Team complexity: How many managers, pay components, and locations are involved in your review cycles? The more variables you manage, the more flexibility you’ll need to keep reviews accurate and efficient.
• Data needs: Do you need access to peer-relevant, trustworthy, real-time total compensation benchmarks to stay competitive, or are periodic snapshots enough for your market you’re in? Is comparing those benchmarks to your roles/levels essential to your compensation planning? Your data requirements will determine whether an HRIS add-on is enough.
• Advanced compensation tooling: Do you require salary-band creation and automatic refreshing, scenario planning, or budget forecasting to inform pay increases? If so, check whether your current system supports those workflows natively.
• Governance and workflows: How complex are your approval chains and permissions? Who is involved? Teams with layered roles, multiple currencies, or total rewards components often need more granular workflow control and audit trails.
• Strategic goals: Is compensation purely administrative or part of a broader equity compensation and retention strategy? If it’s becoming a strategic lever, consider whether your current tools can support that shift.

Many growing companies find that the best setup combines both: using the HRIS to manage core people data – such as employee records, performance, and payroll – and a dedicated compensation platform for deeper insights and planning.

This approach centralises employee information while giving People and Reward teams the flexibility and accuracy they need for effective compensation planning.

Take the team at Tiqets, for example. They use Ravio integrated with their HRIS, HiBob, and value the combination for its real-time data insights and time savings:

“I think what is also really useful is that there's a connection between HiBob and Ravio, so that there's real-time data working for us. That saves us a ton of time as well.” – Maartje Koopman, Head of People and Culture, Tiqets.

FAQs

When is HRIS compensation not enough?

HRIS compensation modules aren’t enough when you need real-time benchmarking data and advanced tools – like automated salary band creation or pay equity analysis – to move beyond basic planning and build structured compensation frameworks that cover salary, bonus, and equity.

Is compensation the same as salary?

No, salary is just one part of compensation. Compensation includes everything an employee earns: base salary, variable pay (like bonuses or commission), equity, and benefits. Salary is the fixed amount paid regularly, whereas, total compensation reflects the full value of pay and rewards a company offers for a role.

What is the purpose of a compensation system?

A compensation system ensures employees are paid fairly, competitively, and in line with business goals. Its purpose is to define how salaries, bonuses, equity, and benefits are structured – so companies can attract and retain talent, maintain pay equity, ensure legal compliance, and align rewards with performance and budget.

What is compensation management software?

Compensation management software helps organisations create, manage, and optimise pay strategies with tools for processes like benchmarking, salary bands, review workflows, and pay equity compliance. Unlike HRIS compensation modules that rely on outdated, error-prone benchmarks and basic review tools, specialised platforms use real-time market data and automated workflows to make compensation planning faster, fairer, and more strategic.

Do you need a compensation management system?

You need a compensation management system if your needs go beyond basic salary planning. For example, when you need real-time total rewards benchmarks, multi-country or multi-component compensation structures, and dynamic salary bands to make fair, competitive compensation decisions – without relying on spreadsheets.

How does compensation data quality differ between HRIS add-ons and specialised tools?

HRIS add-ons rely on internal employee data and static third-party surveys that typically refresh annually. Specialised tools integrate live HRIS feeds from thousands of companies, giving you real-time, role-level market benchmarks filtered by location, company size, and industry – ensuring compensation decisions are current, accurate, and defensible.

Can specialised compensation software integrate with my HRIS?

Yes. Modern compensation platforms like Ravio connect directly with HRIS systems like HiBob, Workday, or Personio to automatically sync job, salary, and employee data. This keeps compensation data and structures up to date without duplicate entry – so your HRIS remains your core people platform, while compensation planning runs in a dedicated, purpose-built tool.

What’s the ROI of switching from an HRIS compensation module to a dedicated tool?

Dedicated compensation management platforms cut hours of manual work, reduce pay-decision errors, and improve equity and retention by using accurate, real-time benchmarks. They replace static spreadsheets with automated workflows, freeing People teams to focus on strategy. The result: faster reviews, better pay alignment, and measurable time-and-cost savings each cycle.

What risks come with relying only on your HRIS for compensation planning?

Relying solely on HRIS compensation modules risks outdated market data, inconsistent pay bands, and manual spreadsheet errors. Without real-time benchmarks or modelling tools, you can’t review the impact of your pay decisions during planning. This also makes it to justify to managers, candidates, or auditors – leading to equity gaps, compliance challenges, and missed retention opportunities.