HeroLab is not required. That's the easy part.
HeroLab is a poweful tool. It is not perfect, of course, and the longer time goes by, the more expensive the "buy in" to get everything for a game system becomes.
HeroLab can make running games easier.. but it is not going to be the right answer for everyone.
Honestly, for me, the HeroLab character sheet is irrelevant. HeroLab IS a character sheet.. a live, interactive one that can be used to apply and remove spell adjustments, skill adjustments, and other ability effects to the PC in real-time.
My experience is mostly Pathfinder, with some D&D 3.5 and Mutants & Masterminds thrown in.
HeroLab's Tactical Console does some useful things, but not enough to suit me. There is an active thread in the Pathfinder forum discussing desired improvements right now.
Returning to Realm Works, if HeroLab is useful for you then Realm Works aynergizes with it for campaign management. Realm Works itself is still "growing" into its promised features, and has a ways to go.
Realm Works is more about managing what your characters know about the campaign and the world setting.. what clues have been found, which ones are still out there to find, who knows whom, who works for whom, who lives where, who works where, and so on. None of that is in HeroLab, or requires HeroLab.
If you are not using HeroLab, the only thing you really miss out on in Realm Works is the ability to place HeroLab encounter portfolios in the encounters for easy access during play.