Selecting new HR software can be a stressful process for most HR professionals. Although companies tend to be aware that their HR software isn’t working efficiently, many organizations will still put off software evaluations due to how overwhelming the process can be.
A typical process can involve time-consuming requirements list building. Cultivating a shortlist opens Pandora's box of follow-up sales emails. Comparing vendors can be challenging when all claim to be "the best option on the market". And, getting executive sign-off can require threading a tight needle of want, need, and vision.
Having helped hundreds of teams with their buying processes, here are a few practices OutSail uses to make the process less overwhelming, more efficient, and more effective.
The most common HR software purchase these days is the HRIS. If you don't know what an HRIS, read this guide: What is an HRIS
1.) Start High-Level
It's easy to start this process with features and functionality, but a better practice is not to get bogged down in the details too soon.
In the early stages, it's important to zoom out. Take some time to imagine what a better operational experience would look like.
Here are some of the questions you'll want to think about: "Where is the business heading?", "What processes are holding us back?" "What are our buying priorities - design? automation? support? integrations?"
If you want to see some of the high-level questions that we ask during a buying process, you might like this article: 8 Questions To Answer When Evaluating HR Systems.
2.) Build Out Your Requirements
Once you have a sense of your high-level priorities, it's time to translate those priorities into actual functionality.
The first step of the process is to think about which modules you want included. Here are the broad categories we consider: Payroll, HRIS & Employee Files, Onboarding, Benefits Admin, Time & Attendance, Performance, Compensation, Engagement, ATS & Recruiting, and Learning
Once you have your high-level categories established, it's time to start building out your required functionality. Our team has developed a simple Requirements Builder tool that can help teams do this in 3-5 minutes. Once you complete the Requirements Builder survey, our team will send over your list of features and requirements.
3.) Curate A Shortlist
Now that you have a sense of what your winning solution looks like, it's time to head into the marketplace and see who stacks up.
You won't be able to pick winners just by their websites, but you can start to eliminate vendors based on a few things:
- Missing functionality. Go to a vendor's website and see if they make all of the modules you need.
- Size match. Ask about a vendor's target market and look at their showcase customers. Do they work with companies your size and in your industry?
- Reviews. Online reviews can be as misleading as they are helpful. But make sure your finalists have at least a few dozen reviews with some positive takeaways.
By eliminating vendors without getting on sales calls, you'll save yourself a ton of time in the evaluation process. You can request OutSail's team to give you free recommendations, or you can learn more about how to Rule Out HRIS Vendors Without Having to Take Sales Calls
4.) Start With Only Three Finalists
Don't overwhelm yourself at the start. Begin with three vendors that look to have the highest probability of success. If you don't like one, you can always add more later.
Also, make sure you're standardizing the review process and asking questions that are important to you. You don't want a vendor to go on and on about a shiny new feature that distracts from your real needs.
We've found that HR teams who come into evaluations with scorecards can increase their chances of finding a winning solution. A good scorecard can help keep track of functionality, make sure you ask the right questions, and automatically weigh certain priorities more than others.
5.) Check Reviews and References
Once you're moving close to a decision, it's always a good idea to ask your vendor of choice for references. Specify that you want to speak with customers who are of a similar size and industry and have been active on the system for over a year.
In addition to getting references through your vendor, you'll also want to do some research on your own too. Look to online review sites, such as G2Crowd or Capterra, where you can narrow reviews down by industry and size.
Also, be sure to dig around in your network and social circles to see what peers have to say!
6.) Negotiate the Agreement
Negotiations are the most underutilized step in the HRIS buying process. Buyers just assume that the list price is fixed and can't be moved.
But in our experience, almost every single buyer who negotiates ends up with a far better deal.
We've built a long guide detailing how to negotiate, but a few of the key things to keep in mind are:
- It's a give and a take, so if you want better terms, you'll likely have to agree to sign a contract by a certain date
- Your sales rep is your ally, so arm them with what they need to bargain on your behalf
- Annual software fees are always more valuable than implementation fees