How to choose the right HRMS for your company: 7 rules
If you are seeking to make an investment into the latest HR technology in hopes of achieving higher productivity, right hires and minimized expenses, then stay on a cloud-based HR management system. This is an all-in-one solution for streamlining general human resource processes within your company including attendance, payroll management, performance appraisal, and absence management, to name a few.
Companies which have already been using core enterprise HRMS are making the massive switch to SaaS solutions, as the latter offer better flexibility and a wider range of options. But not every HRMS solution will be helpful. With the variety of HRMS vendors available out there, the problem of choice arises. How do you assure that you’re getting the best value for your money? In order to ensure the full automation of the HR processes and avoid overpaying for functions and features that won’t be used, it’s sensible to start with determining your human resource goals and strategy, and taking the time to research existing HRM systems.
To choose the software that can bring you maximized benefits, you can take the following steps prior to making a purchase decision:
1. Reconsider or Update Your HR strategy
Planning the purchase of HR management system is an excellent reason to review and make adjustments in your overall HR strategy for the next few years. Why? Because HRM systems provide a means for you to automate the processes which earlier were done in an old-fashioned way, which in its turn will save the time of HR managers and help make a breakthrough in the areas where the staff may have been underperforming.
So, start by defining how you’d like to organize the work of the HR department and which HR goals to reach, and only then get down to considering possible software solutions. The right HRMS is not the one that has the most positive feedback from other companies, but the one which best fits your strategy.
2. Define your software needs
After you’ve completed step 1, you have a long-term action plan for your company’s HR and it’s time to determine the tool that will help you accomplish your goals. So, define your software needs, and be as detailed as possible. The majority of HRM applications offer the following functions:
Performance and compensation management
Recruitment and onboarding
Leave and absence management
However, this list is too generic and might not reflect your organization’s bespoke needs. To clarify your requirements, create a list of the functions you actually need and then ask 2-3 questions for each point. For instance, if you need the Pay History option, you might clarify it as follows:
What period of time should be tracked or should the history be unlimited?
Will there be an analytics or reporting option?
As soon as your requirements are clear, it’s time to create a spreadsheet that will be your tool for vendors’ comparison.
3. Set the budget
Before you can actually start searching for vendors, it’s essential to determine how much money you are ready to spend and seek for management’s approval. Usually, the HRIS charge includes one-time payment for software, a monthly or quarterly fee, and costs for implementation, support, etc.
4. Choose 4-5 vendors for review
As the main criteria for picking the HRIS is set, it’s time to browse different vendors and fill out the spreadsheet to analyze how they meet your requirements. There are dozens of vendors offering their solutions, so the task is not so easy. Actually, it will be helpful to pick up to 10 vendors to have reserve options in case the primary vendors will be screened out after further dialogue or demo.
5. Research the company or talk to support
To make the process of choice less time-consuming, it’s better to research more about the company policies and talk to a support team before setting up a demo. Some vendors provide updates on a quarterly basis – will this be convenient for you? It’s also helpful to clarify their information security strategies and find out whether they back up the data.
When finding out more about the company, pay attention to how many years they have been in business. More years mean more successful products, more satisfied clients, and less bugs and technical issues that might occure from a less expensive company.
6. Conduct the demo
Now it’s time to test the software, either online or installed version. Invite the people who will be using the HRMS on a daily basis, so they could see from the inside how the software works and make their remarks. During the testing process, make notes in your spreadsheet about the various functions and how they satisfy you; if any questions arise, note them as well to ask a support team later. One of the key features to be evaluated at this stage is usability; don’t choose software with a complex interface that may slow down the speed of work and possibly cause errors in the future.
7. Making a purchase decision
If you’ve strictly followed the above points, by this step you’ll have a handful solutions that best fit your technical needs and expectations. The final step is to get the approval from management and start using the HR management solution organization wide.
An HR management system can be just what your organization needs to optimize current processes, provide you with analytical data to improve productivity, and streamline communication between management and staff. However, to achieve your goals set, you should start with determining the critical HR needs of your company and the tools which will serve your goals. If you’ve taken the time to first identify your needs, then the result of using an HRMS can even exceed your expectations.