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What to do before Buying an HRIS
By Greg Howard, Marketing Communications Manager, TriNet
A powerful return
on your initial investment or a money pit-your purchase of a Human
Resource Information System will quickly become one or the other.
What's the best way to approach this complicated business decision?
Do a little research, conduct a little due diligence, and get a
whole lot of buy-in from your company's executives.
The decision to buy an HRIS itself should be relatively easy. You're
probably researching options if you find yourself needing the "Three
C"s: compliance, cost, and control.
A lack of the Three Cs can result in the following problems:
- Your IT department
expends valuable time and resources dealing with your company's
internal human resources issue.
- Your management
or vendors ask you for reports you can't provide
- You don't
have enough HR staff to handle the volume of work, and you may
need to increase your personnel budget.
- You have
compliance issues due to an inability to track hiring, promotions,
and terminations
- You're doing
most of your company's HR transactions on paper
If none of these
situations pertain to you, then you're the envy of your peers-you
have enough internal people and budget to handle your administrative
tasks, and you couldn't be happier. But studies indicate that most
companies don't feel quite so blessed. A survey by Watson Wyatt,
covering the Top 10 eHR priorities for 2003, found that executives
are seeking better optimization of virtual workplaces, better implementation
of web-based employee self service, and new ways to cut HR costs
through technology.
So how do you get there? Here's some things to keep in mind when
shopping for an HRIS.
1. Make sure the HRIS integrates benefits
and payroll.
Some products simply offer payroll processing or benefits administration,
or mix them together haphazardly. Any HRIS worth knowing should
integrate complex processes together seamlessly. When benefits "talk"
to payroll, deductions are simple and legal compliance is a walk
in the park. How often are they synchronized? What data entry needs
to be done on the front end? Don't settle for an HRIS that simply
claims to "integrate"-find out what integration means,
and how it will translate to faster and more efficient HR at your
company.
2. Ensure that the product comes with in-person
support.
The worst vendors drop a piece of HRIS technology down on your office
like a big, ugly anvil from a "Bugs Bunny" cartoon, and
then head for the hills. Do you have support for the platform? Can
it be easily upgraded? What's the price point for licensing and
maintenance? Can it be customized for your company's specific needs?
How will you and your staff learn how to use it?
Outsourcing
the technology can be one way to ensure consistent support. Since
you're not dealing with a one-time only sale, your vendor will consistently
have to show value to you. Furthermore, you can slash your up-front
costs by paying a much smaller monthly charge for the ongoing use
of the platform.
The bottom line:
don't settle for high tech; find a high touch solution as well.
3.
Bring on the web-enabled self-service.
The HRIS will be seen as a money waster by the upper echelons of
your company's management unless it displays tangible benefits in
the form of manager and employee self service. The best online solutions
offer hiring, benefits enrollment and funding, employee administration,
timesheets, and reporting features. Reporting in particular is a
powerful tool, so make sure the HRIS gets it right. For example,
you'll want to access census data and run reports such as EEO1,
birthdays, and hire dates. Make sure the data is integrated into
a single set of reports, rather than spread out over various applications-and
make sure it can be manipulated with Excel spreadsheets and broken
down via pivot tables.
Self service
should also mean that your employees can get quick answers to benefits
and payroll questions. Remember, the more employees can do for themselves,
the less they'll bother you-and you'll have more time and focus
to stay strategic.
4. Make sure you're not feeling insecure.
Entrusting your company's confidential information to a new technology
is not for the faint of heart. Give yourself (and your executives)
the confidence you need to move forward. What security measures
are in place to protect your data? If the HRIS platform is web-enabled,
what protocols ensure that only authorized users can gain access?
Ideally, the CIO of your prospective vendor will be able to walk
you through each layer of security.
5. Bargain for lots of juicy extras.
It's a different world now that the economy has softened and there's
less dollars to go around. The good news: that usually means you
can get more for your money. Don't settle for an HRIS if you can
find a full-service HR vendor that offers help with employee relations,
training, and even Open Enrollment management. A best-in-class HR
vendor can even provide a call center for your employees, which
means your management won't spend time answering basic benefits
and payroll questions. Find out what your prospective vendors have
up their sleeves, and then negotiate. You may find yourself returning
to your company to face a hero's welcome.
6. Develop a case for ROI.
Before any hero worship can happen, of course, you need to convince
your decision makers that an HRIS makes sense in the first place.
Again, that's where your chosen vendor can prove its mettle. Any
trustworthy HRIS vendor will either have standardized ROI case studies,
or be able to customize a case study that speaks to your situation.
(And preferably both.) Any ROI argument should include:
- Time and
cost savings of online self service
- Ability to
service a distributed or multi-state workforce
- Legal protection
provided by better benefits and payroll legal compliance
- Reduced turnover
due to faster and better service to your company's key talent
- Elimination
or streamlining of redundant processes
- Reduced need
to invest in staffing and administrative infrastructure
Outsourcing
to a vendor that provides access to an HRIS platform can achieve
many of these metrics, so be sure to research that approach. Companies
as small as 20 employees may be able to save money with an outsourcing
service.
Cutting the administrative fat out of your company is very likely
going to be a top priority in this brave, new, money-conscious world.
Do your homework first, ensure your vendor can meet your need for
the Three Cs, and help your company's decision makers understand
the numbers. After that, you're ready to do some serious HRIS shopping.
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