As the holiday season comes into sight, no one wants to be thinking about buying business software. It’s understandable if your thoughts are more focused on striking the right balance of Turkey and Tofurkey at the office party, managing family logistics come Christmas, and making sure things are running smoothly so you can focus on life outside of work. Before you check out for the holidays, it’s worth taking a look at what’s coming afterward: A new fiscal year, a new hiring season, and new opportunities to make your year easier!
As you wrap up your year, it’s helpful to start considering what your requirements should be for you next, or your first, HR management software. Knowing what to look for in an HR management software isn’t necessarily a straightforward process, so we’ve provided some guiding questions you should ask yourself first. These 9 questions will help you determine what your requirements are for an HR management product when you’re ready to start your search in earnest.
Questions to ask about Your Business
1. How big is your company?
Like most software types, certain products are scaled to certain user sizes. Some products are designed for startups instead of enterprises, and vice versa. Where various products fit in this spectrum is usually evident both in a product’s marketing and reviewer demographics on their TrustRadius profiles. While these trends aren’t a hard and fast rule if you’re looking for ways to narrow the range of options, find products that are targeted at your business’s size.
For instance, if you’re a bigger company with a large workforce, having different HR processes integrate with each other can save you and your team a ton of time from handling the flow of data between different HR processes, such as recruiting to onboarding to payroll. HR management has become fairly adept at this, even between different product lines. However, the bigger the use case, the more impactful any manual steps are for your workload, and the more beneficial a well-integrated ecosystem like an HCM will be beneficial.
2. How big is your HR team?
Do you have dedicated HR personnel managing your HR processes? Is it one primary person with other department managers sharing the load on the side? Are you the business owner and HR department all in one overworked body? The answer impacts both what you need from the software and the software vendor.
According to our research, implementation is frequently the biggest challenge HR pros face when using HR management software. On one hand, having strong support from the vendor during implementation can make the process much less painful. On the other hand, implementing software that’s a heavier lift than your team is ready to manage makes the problem immeasurably worse. Have a conversation with your HR team (even if it’s a mirror) to have a good idea of how prepared they are for implementing new software, and look for a vendor that can help cover the extra distance.
The size of your HR team also impacts the value of certain software post-implementation. If you have a larger team, it may be easier to manage a product that requires more routine input and work from your HR personnel but can deliver results at scale. In contrast, a smaller or 1-person team may be more value out of a simpler product that focuses on automation and giving you time back in your schedule that would otherwise be spent on important-but-routine HR tasks like payroll.
Questions to ask about Your HR Functions
The goal behind these questions is to determine how extensive a feature set you need, and ideally which features are most important to you. You may just need a Human Resource Information System (HRIS), or some strategic HR functions, or a centralized platform to handle all your HR needs from start to finish.
3. Do you just need the basics?
Here, the “basics” refer to payroll, employee data storage, and benefits management—the HR processes that virtually every business needs. If you’re looking for a more barebones HR operation, a core HR product will likely be a good fit for you. Some examples include TriNet and RUN Powered by ADP.
4. If you want to use strategic HR features, which processes matter the most to you?
HR management software has been consolidating as many HR processes as possible onto centralized platforms with the option to pick and choose which modules you want to use. While not every software includes support for every process, the market is approaching that point. However, not all feature sets are of the same quality or robustness. You should determine what strategic HR functions you need to implement, and which of those are the most important. Some options to consider:
5. What’s your approach to recruiting?
Some businesses are able to hire on an ad hoc basis with cobbled-together document tracking and interview processes. This gets old quick if hiring becomes more common, and you risk quality talent falling through the cracks. Using the right applicant tracking system (ATS) makes all the difference in running a clean recruitment operation that also attracts talent.
A key differentiator between ATS products is their support for recruiting passive candidates by building up brand awareness in the job market and enabling long-term Candidate Relationship Management (CRM). This functionality isn’t universal and isn’t appropriate for all industries, but if you’re playing the long game to attract top talent, finding HR management software that offers CRM capabilities starts you off on the right foot.
6. How do you want to keep an eye on company culture?
Data over the last few years has shown businesses struggling to keep employees engaged and committed to the organization, with employee experience identified as a prime cause of the trend. There are multiple avenues to addressing this shortfall, ranging from better identification of problems before they become crises, to better responsiveness from leadership when addressing said problems.
If you think your business is experiencing engagement problems, or want to preempt the possibility, employee engagement functionality can play a crucial role. While these capabilities won’t replace action from leadership, survey tools and reporting can help identify what steps leadership should take.
7. Is it time to commit to long-term employee growth?
Your answer will depend largely on what industry you’re in. For instance, service-sector and hourly positions may benefit less (but more than you’d think!) from the more intensive talent management features.
For knowledge and skills-based industries, continuing to invest in the talent you have is more effective, and cheaper, than hiring new personnel with every growth and advancement in your field. In that case, talent management features make retaining and developing employees past onboarding more efficient and successful.
The tools that manage talent span the employee lifecycle. For instance, performance management and learning management help develop career skills and measure performance against expectations more transparently. From the business’s side, succession planning and goal setting allow your company to implement long-term personnel planning and forecasting, including spotting and addressing future talent gaps before they hit your workforce.
8. Do you want all your HR processes centralized on one platform?
The question behind the question is, “Do you need an HCM?” One of the main benefits behind an HCM suite is it’s usually centralized onto one platform, and often one interface. This can make HR processes much simpler and more straightforward than having to coordinate across multiple products and vendor interfaces.
On the flip side, if you opt into centralizing everything onto one HCM platform, you’re also limited to the quality of the various features and functions of that particular product. For some, particularly large businesses and enterprises, it’s a worthwhile risk every time. However, if the unified platform isn’t a selling point inherently, take a good look at what each function you need would look like for you before investing your operation on the product.
9. What reporting do you need?
Data driven insights are all the rage in leading HR management products, as Workforce Management and analytics capabilities are being incorporated more heavily into broader suites. However, better access to data doesn’t mean that a software’s reporting functionality can effectively use it. While the quality of reporting varies by product, it’s the lowest rated feature for over half of the leading products featured in the Buyer’s Guide to HR Management software.
In order to make the most of a product’s reporting capabilities, have a clear idea of what reporting you want on the front end. For instance, what specific reports are you using currently and which metrics do you need to collect data for? If reporting is a frequent and intensive activity for, you will also benefit from software that can automate routine reporting to ensure that reporting is a value adding activity, rather than a pain point!
Answering these questions will get you on the right path towards selecting the right HR management software for you. If you found the different areas and types of HR management confusing or vague, check out our guide to the “HR management turducken”.