Ten Step Guide to Selecting Human Resource Software

Ten step plan for HRIS Software Selection

1. Improve your HRIS software knowledge
2. Determine your Needs
3. Create a detailed HRIS software needs and requirements spreadsheet
4. How much can you spend?
5. Pick a handful of HRIS software systems to evaluate
6. Demo advice
7. Research the short list
8. Determine the implementation scope
9. Make the decision
10. Getting approval

1. Improve your HRIS software Knowledge

Before you can determine your needs, budget, or anything, you have to understand what the overall capabilities, features, and options are of the various HRIS software applications. There are a number of ways you can educate yourself on these capabilities. One is to look up articles, such as this one. There are tremendous online resources and articles created on this exact subject. There are also a number of sites that show a number of HRIS software applications and provide helpful information for your education, as well.

2. Determine your needs

Everything you read about buying HRIS software is going to say exactly the same thing. Telling you to determine your needs is nothing new. The concept is used so often it is almost considered a cliché. The point of this section is to tell you what this statement means and why this step is extremely important when starting your search for HRIS software.

There are currently hundreds, if not thousands, of HR software providers doing business in North America. There are numerous vendors who list themselves as either an HRIS vendor or as an HRMS vendor. There might be as many as 100 of these companies. When creating your needs and requirements for either HRIS Software or HRMS software, you need to think of your job as narrowing this list from 100 vendors down to 10 or fewer.

I have reviewed a large number of these HRIS systems. In my opinion, these vendors offer 60% of the same functionality. So if you approach 100 of these companies and state that your requirements are to have a system that tracks job history, performance review dates, birthday report, turnover reports and other reporting capabilities most, if not all, of these applications will show you the same capability. This would be like looking for a house and telling the realtor that you need any number of bedrooms, any square footage, and in any neighbor hood.

When creating your needs and requirements, look at it from the perspective that if you were to design an HRIS software application what would you include in the software. Exactly what reports do you need, what data do you need to track, how would you populate the database fields, and would you need to interface with any of your other software applications?

In this process of determining your needs and requirements, make sure to also confer with other departments who might end up utilizing portions of your HRIS product, as well.

3. Create a detailed HRIS software needs and requirements spreadsheet

You will likely look at a number of systems and, like looking for a house, eventually you are going to forget which system did what and offered what advantages. I recommend creating a detailed spreadsheet to assist with this process. Down the left side, list your needs and across the top, list each vendor. If you want to offer more detail, you might end up reviewing each HRIS application to score each product.

4. How much can you spend?

Now that you have improved your HRIS knowledge and you have a detailed list of your needs, you need to determine how much you can spend before deciding which applications you want to evaluate.

How much you can spend can be a little tricky because of the various pricing options vendors offer. Hosted solutions will offer their applications at so much per employee per month. The advantage is that over the short term, your up front investment is going to be far lower with these applications than purchasing an application, where the investment is largely made on the front end. Even with purchase options, you might look at a lease to own contract where you pay for the software over a five year time frame and you own it at the end of the contract.

5. Pick a handful of systems to evaluate

The first thing to do is find the short list that seems to meet your needs. Perform a few searches and you will find a hand full of sites that list a number of HRIS systems on their sites. Some even offer the capability of filtering the products by options or features.

The hard part is figuring out which systems not only meet your needs but also match your budget. In a perfect world, buying HRIS software would be like buying a car. With a car you can go to a web site, type the kind of car you want, the price range, and you get a list. This is, unfortunately, not the case with HRIS software. The less expensive systems will gladly provide their prices. The more expensive systems are, in general, going to expect you to run through the whole dog and pony show before providing the prices.

The sales people for those companies, while they might not offer the prices up front if you call and tell them what your max budget is, will at least tell you if that is possible or not. At the end of this process, you should have your list scaled down to four or five systems of which you will want to see a demo.

6. Demo advice

With each demo, have your spreadsheet in hand and make sure that each need or requirement you have identified is shown during the demo. With your score spreadsheet in hand, provide a score for each need. This step is actually pretty easy because you did your homework up front.

7. Research the short list

After reviewing the four or five products, you will likely cut this list in half. From here, do a little research on each company. Ask for references, see how long the company has been in business, and how many installs they have. To receive unbiased opinions, hit the SHRM technology boards and post a message asking if anyone else has used the product and see what their opinion is. Add scores, the prices, years in business, and the number of installs to your spreadsheet.

8. Determine the implementation scope

You will know exactly what you are paying for the software, service and/support. Some companies may fix cost the implementation costs. Others will provide an estimate of time to complete the work and training. In either case, if the scope of the project is not determined in detail before the project begins, this is where you are going to go over budget. Make sure you receive an implementation quote that shows hours for each phase of the project. Look it over and make sure that each of your needs is met with the process.

9. Make the decision

Looking over your spreadsheet is the easiest step in the entire process. By now, you have likely narrowed your list to two or three systems and there is no confusion because the best solution is scored the highest on your spreadsheet. Of course price, references, and your company research will play a part, as well. Congratulations on a successful search!

10. Getting approval

Sadly, many companies view HR as a cost center. As a cost center, it can be difficult to get approval for a system that may benefit a single department. This is part of the reason, under determining your needs, I recommended involving other departments. Determine what the company objectives are and try to tie your case for HRIS software to these objectives. A system that benefits the entire organization makes a stronger case for need.