HR Software Selection Myths Part 2

In the second part of this series, we’ll look at some more of People-Trak’s Software Myths and Legends (based on this informational article) from an onboarding perspective.


HR Department Job Loss

It’s understandable for HR staff members to feel threatened by the implementation of automation products. After all, there’s a long history in this culture of replacing people with machines that can do the job better, faster, and cheaper. But many organizations have a woefully understaffed, chronically overworked HR department to start with. Employers typically want greater efficiency and strategic improvement more than they want to cut their HR headcount. Automating a process like onboarding simply frees up HR to start using its own human resources more effectively. For example, HR staff can spend more time with each new hire making them feel welcome and comfortable instead of plowing through a stack of forms.

Implementation and Consultation Worries

As the folks at People-Trak mention, a small to mid-sized business shouldn’t have an excessively lengthy implementation for HR software. At Emerald Software Group, our onboarding software clients are typically medium to large sized businesses. However, there’s still a fairly modest time commitment involved for implementing the basics of Universal Onboarding (forms automation, policy acknowledgements, Payroll integration). Further interfaces can be phased in at a pace that is convenient for the client so that everything goes smoothly.

We do recommend collaborating with an HRIS analyst to speed things up. If you have an analyst on staff, that’s perfect. He or she will have a full understanding of your business, HR, and IT processes. If not, we can still work with HR and IT to make sure everyone is on the same page about things like system requirements and functionality. We’ve structured our onboarding products with ease of customization (such as look and feel) in mind. We also have a long list of interface solutions prepared for commonly used HRIS and Payroll applications. If you have non-standard back end systems, that’s fine too. We are always looking for more opportunities to expand our experience interfacing with new products.

HR Software Selection Myths Part 1

People-Trak has an educational pdf available about HR software myths and legends. It offers a look into the mindset of the inexperienced software buyer. It’s definitely a thought provoking piece and worth a read. Here are some of the highlights along with how they apply in the field of onboarding software.


HR Software as the Unlimited Problem Solver

Just as HRIS won’t make all your blues go away, an onboarding system isn’t guaranteed to eliminate snafus. Not every software product for new hire onboarding is created equal. You need one (like Universal Onboarding) that will enforce rules regarding how each data panel is completed. Otherwise, HR will still spend hours dealing with exceptions in new hire forms. You also need to take a close look at all the policies you have new hires sign off on during onboarding. Your software can support you in collecting acknowledgements, but it won’t protect you from litigation if your policies are not compliant with labor laws.

HR Software Complexity and Expense

It is possible to overspend on HR software – if you don’t understand what you need. You should review both the actual functions of an application and how each function dovetails with your organization’s business strategy to determine whether a product is worth its price tag. For example, onboarding that enhances compliance and automates processes has a high value for any business. With SaaS options and a fee based on a “per new hire” schedule, the costs are minimized without sacrificing quality.

Extensive HR Training Requirements

People-Trak suggests that HRIS software should be designed to simply automate tasks and therefore should require little training. We agree that a well-designed system should be easy and intuitive to use. But it’s not true that automation is all an application should offer. If a software product does not actually improve the way you carry out HR processes, it’s probably not a Best of Breed solution.

HR Software Metrics

Now more than ever, HR is looking at hard numbers to make decisions about HCM strategies. This is becoming easier since HR software vendors are incorporating better tools for analysis and reporting into their products. These days it’s possible to measure in detail how a wide spectrum of workforce related decisions impact business outcomes. But evaluating the past in light of the present is just one way to look at the data. It can also be used for predictive purposes. Workforce.com has put together an article outlining how some companies are using workforce metrics for forecasting and planning – the latest strategic implementation of HR technology for employers who want an edge on the competition.


Adequate Staffing Requires Foresight

Predicting the need for and availability of labor is the most obvious type of HR analysis. Recruiters need to understand how a combination of factors such as future growth and potential attrition of key existing employees will impact staffing requirements and capabilities. This makes it possible to create retention and succession strategies targeting positions that are at the highest risk. Appropriate use of predictive HR metrics could also lead to better choices during recessions. Too many employers have found out the hard way that they laid off the wrong people over the last few years. Now, there’s a critical shortage in areas like development and middle management where employees are not easily replaced.

What Could Change for HR?

The emphasis on forecasting may lead to a greater demand for HR statisticians. The ideal candidate would be someone who understands software (like an HRIS analyst) so the best tools are implemented for capturing the right kind of data. This statistician would also have to understand how concepts like employee engagement intersect with hard numbers.

Onboarding is Ripe for Further Analysis

One area that is being studied for its ability to predict turnover is onboarding. According to information compiled by the Aberdeen Group, companies that have a well developed acculturation onboarding strategy fare better than their counterparts in retention of talent. Onboarding software plays an important role in ensuring new hires are fully equipped and engaged. Applications such as our Universal Onboarding and Acculturation Portal provide analytic tools to help HR measure outcomes and identify ways to increase efficiency in onboarding.

What Is Your HRIS Input?

HR software expert Clay Scroggin has an interesting perspective on one aspect of HRIS that some clients don’t think about until after they’ve bought a product – how much input will be required? He breaks down the topic into several different categories. First, there’s the data you will have to transfer as a one-time effort. This could include importing from other existing programs such as from a simple employee database into a full service suite. He points out that benefits data is often not directly transferrable and has to be typed in painstakingly by hand (although this is changing in the age of SaaS applications which often have a high level of built-in interoperability).


Then, there’s the data that needs to be updated on a regular basis. An interface can allow this to happen electronically; but there’s often still some human action required to set the process off. Even if it’s as simple as pushing a button to run the importing function once a week, that’s still something that HR has to remember to do - or IT has to set up a script to run the transfer of data automatically. There will always be differences in content between HRIS and other systems (such as Payroll) in terms of real time data unless they are actually fully integrated with one another. There’s a third type of input, but you’ll have to read Scroggin’s article to find out what it is.

What’s the Input for Universal Onboarding Software?

An onboarding module requires input just like any other aspect of HRIS. The first set of data is input by the new hire. Some of this information may actually be imported from a recruiting module if one is interfaced with the onboarding system – but either way that part of data entry is done by the job candidate or new hire rather than by HR staff. Once the new hire’s part is done, the forms are forwarded to the hiring manager and/or I9 administrator for review and final signatures. Input of information into e-Verify may be required at this time. The distribution of data to other back end systems can be carried out automatically based on internally determined rules. HR may also need to add new forms or update old ones from time to time (e.g. company policies). However, all government forms are kept current in the Universal Onboarding library by Emerald Software Group so HR doesn’t have to worry about that particular input.

How Can Onboarding Software Be Leveraged To Save Money?

Over the last few weeks, we’ve looked at the ways HR software delivered via SaaS and cloud computing is attractive to business owners; but what about onboarding software in particular? Where does it fit in the strategic picture for IT, HR, and business leaders looking to cut costs? Are there any compelling reasons to add an onboarding module to a suite of advanced SaaS HR software that already has recruiting, training, benefits management, ESS, and succession planning functions?


Actually, there are several arguments that can be made for the value of an automated onboarding program no matter how good the rest of your HR software already is. First, the quality of the data in your HRIS database is only as good as the data entry that supports it. New hires often make errors in their paperwork or leave out critical information on electronic forms. If HR notices these mistakes, they may get fixed (requiring extra work). If not, data errors end up going into the system where they may be distributed to other applications.

For example, a W4 with conflicting elections will wind its way to Payroll where it can cause problems with tax deductions on an employee’s paycheck. With an I9, the issues might not become apparent until the ICE auditors show up – and then it’s too late. Automated Universal Onboarding software completely bridges the data collection gap between Recruiting and general HRIS. It eliminates redundant data entry and prevents new hires from making mistakes or leaving required fields blank on their electronic forms.

So, these are 2 of the most obvious ways onboarding software can be used to save money:

1. Eliminating errors and omissions in both initial forms completion and distribution of data to HRIS and other back end systems. This increases compliance with labor laws and with internal company rules.

2. Replacing an inefficient hybrid of paper and electronic systems with a fully automated virtual HR process for onboarding new hires. This cuts administrative costs immediately and supports corporate eco-friendly initiatives.

The SaaS and cloud based versions of Emerald’s onboarding solution also deliver benefits such as vendor-provided maintenance, high levels of data security, constant system availability, pricing based on actual usage, and immediate scalability during peak hiring seasons. Finally, increasing the efficiency of data collection during onboarding permits the implementation of tax credit forms that allow businesses to capture incentives from both state and federal governments.

What Do Employers Want To Know About Buying HRIS?

Compare HRIS.com has an extensive knowledge library on HR and Payroll software topics. Some of their articles are more popular than others. So, they’ve taken a look at the top 10 most frequently read pieces. These offer a sneak peek at what business owners and HR decision makers want to know as they shop for HR software. Most of the topics that get lots of hits fall into 3 basic categories: money, IT, and functionality.

Money

There are two things employers want to know about HR software. First, how much will it cost? Second, how much will it save? Smart vendors generally answer both these questions by answering a third: How much is it worth? Author Chris Scroggin points out that it’s nearly impossible to do an “apples to apples” price comparison for HRIS software with an online search. That’s because companies that offer high value software typically choose to demonstrate that value to a customer before going into detail about price. As time consuming as it may be, it really is necessary for software vendors to consult with HR clients to identify their specific needs. Then, vendors can show how their HRIS software can be leveraged strategically to reduce administrative overhead and speed ROI.

IT

Information about how to work with IT in selecting and implementing HRIS is always a big draw for HR professionals. CEO Shafiq Lokhandwala from NuView HRIS Payroll, Inc. offers a tongue in cheek look at this topic in “IT is from Mars & HR is from Venus”. At Emerald Software, we encourage clients to enlist the aid of an HRIS analyst to help bridge the gap between HR and IT. This does wonders for ensuring successful implementation, integration, and interfacing with minimal conflict.

Functionality

As with any complex buying decision, sometimes you just don’t know what could benefit your organization until you realize what’s available. For example, it’s not unusual for an HR client to look at Universal Onboarding and discover that the application addresses compliance issues they didn’t realize they had. So, HR decision makers are looking for information that educates them about what they need and how to get it. It’s also interesting to look at what is important to other employers when they start shopping for an HRIS system. Check out this breakdown (by company size) of what HR typically views as the most and least critical software features.

What HR Executives Want From SaaS

SaaS vendor Plateau Systems and advisory firm Saugatuck Technology released the results of an interesting survey earlier this year. The 200+ HR executives who participated in the study made it clear that they have compelling reasons to choose SaaS. Plus, they know what they want in an SaaS vendor. Online software access has become common enough that the novelty of the delivery system is no longer a prime selling point. Businesses can source core HR software from among a broad field of competitors. So, executives can afford to make comparisons.


Up front implementation is one area where businesses are looking to save money. By now, human resource execs know that it’s easy for an SaaS product to look great in the slick sales brochure - but that everything will fall apart without appropriate interfaces. HR is are catching on to the fact that they can’t just contract with an SaaS vendor and expect IT to do the heavy lifting in making the application work. Employers expect vendors to provide implementation assistance and troubleshooting. Ongoing support is also a negotiating point at the HR table. In other words, they want the service part of the Software as a Service package to mean something.

Effectiveness Draws HR to SaaS

As the focus in HR turns more and more toward strategic planning, executives are realizing that their business performance is lagging compared to other departments. They have the right priorities but simply don’t have the right tools to improve operations. While core HRIS is a central feature of SaaS for HR, niche products are also being sought to address strategic needs quickly and efficiently. Talent acquisition, management, and retention are all key areas where HR is trying to close the gap.

Onboarding is an obvious area of potential improvement for the mid to large size businesses involved in the Saugatuck survey. From the perspective of service, Emerald Software Group makes it a priority to help clients ensure a successful onboarding software implementation by collaborating with IT and HR. We also address another top HR executive concern (data security) through adhering to industry best practices. For more information, contact us at 770-569-5122.

Can HR Negotiate Better Software Deals?

The HR Capitalist has an amusing and insightful blog post up about why so many Human Resources professionals tend to be poor negotiators. Many people get into HR because they enjoy helping people – not because they enjoy driving a hard bargain. This generous attitude has its place in creating great employee relations, but it doesn’t serve HR well at the bargaining table when money is on the line. HR decision makers need to be ready and willing to negotiate with their software vendors to get the best product and the best deal.
Pricing Isn’t Always Set In Stone

For core HR software that can be purchased from many different vendors, pricing is usually a negotiable point. This is more likely to be the case with on-site licensed products than with SaaS. Vendors that use traditional licensing as their primary business model often have significant wiggle room if their pricing is inflated. Figuring out where the padding is can help HR determine where to ask for price breaks. Pricey ongoing maintenance/service packages allow many of these software vendors to generate a substantial portion of their revenue. This is an area where HR may be able to vigorously negotiate for better pricing.

In the SaaS market, the profit margins are not always as flexible. The vendor is already taking primary responsibility for all the software maintenance, upgrades, security, etc. Plus, these vendors are often pricing their products very aggressively to earn a larger market share in an industry still dominated by traditional licensing. However, with SaaS vendors who require a contract rather than a no-commitment monthly subscription, there is sometimes a potential to negotiate a longer contract term in exchange for a lower fee. It never hurts to ask.

It’s Not All about the Money

Niche and Best of Breed HR software vendors may be less likely to come down on their pricing because they are not in competition with as many other products. However, this doesn’t mean there is nothing on the table to negotiate. For example, your organization might need to interface the vendor’s software product with another application such as your HRIS, ERP, or a third party program.

A savvy SaaS vendor might have a vested interest in helping develop such an interface. Building a track record of successful interoperability with a broad category of applications gives the vendor a competitive advantage and widens their prospective client base. At Emerald Software Group, we are constantly adding to our portfolio of interfacing capabilities for Universal Onboarding. So, let us know your needs in this area – we are ready and willing to negotiate!

Should HR Interface or Integrate Applications?

Spectrum HR has an excellent whitepaper available online discussing the benefits of interfacing vs. integrating various aspects of HRIS. What happens when an HR department is rigidly determined to have as few software vendor relationships as possible? The organization may actually be shooting itself in the foot by choosing a partner that offers an integrated HR system as part of its product offering.


Payroll is obviously a highly specialized field and requires software that makes it possible to effectively manage all aspects of employee compensation from overtime calculations to leave accrual to tax withholding. The state and federal rules for payroll management are constantly changing, so outsourcing this function or hiring a specialist to run an in-house program makes sense. However, payroll software vendors aren’t really the best choice for HRIS. Their products are too narrowly focused and HR simply doesn’t get all the tools needed to manage non-payroll aspects of workforce management. Inevitably, HR must add other third party applications to pick up the slack.

An ERP suite software provider may have a more complex HR offering and the pricing is likely to be attractive as part of a package deal. However, key areas of functionality are still likely to be missing. This leaves HR struggling to develop workarounds that are inefficient and not agile enough to remain compliant with labor laws.

What’s the Answer

The conclusion reached by the authors of the Spectrum paper is that Payroll and ERP vendors simply don’t provide the solutions HR needs for human capital management. The obvious answer is to implement a Best of Breed HRIS product rather than trying to integrate critical HR’s processes with the limited functionality of software that is not designed with HR’s needs in mind. The HRIS can then be interfaced with the Payroll partner and the ERP application as needed to share data.

HRIS Still Doesn’t Have It All

The relationship between HRIS applications and onboarding software is identical (albeit on a smaller scale) to the difference between ERP and HRIS solutions. Onboarding is too often thrown in as an afterthought rather than being designed for compliance, efficiency, and practicality. That’s why Emerald Software continues to offer Best of Breed Universal Onboarding software for our clients to interface seamlessly with their existing HRIS program.

HR Versus IT: Rogue SaaS Applications

One of the benefits associated with greater mainstream acceptance of SaaS is that it reduces the conflict between HR and IT. Business leaders in many different departments are often tempted to implement SaaS solutions without input from IT. That’s because the process of vetting software can seem to take forever. When strategic decision makers get tired of waiting around, they may move forward on their own. According to survey results floating around the blogosphere, IT often has no idea that managers are going behind their backs to contract with SaaS vendors. As you can imagine, when a CIO finally catches on to the presence of these “rogue software applications” this doesn’t go over well.


Why HR Might Circumvent IT

In many HR departments, just getting through the day-to-day pile of work is hard enough. Lobbying for support from IT to get new software implemented can take a lot of time and effort. Often, it seems that any suggestion regarding software improvement that doesn’t originate in IT is summarily rejected. Plus, HR may have a very small budget to spend on upgrading their processes. This makes the use of SaaS applications that don’t require IT involvement very appealing. SaaS vendors know this and will often use it as a selling point for their products.

Pitfalls of this Approach

When an HR director decides to go rogue and sign an SaaS vendor contract behind IT’s back, there may be serious problems ahead. A back door approach to implementation does nothing to strengthen collaboration between HR and IT. That may be bad news later when events transpire that lead to the discovery of the maverick software. This can happen if:

• HR realizes after the fact that the SaaS application requires customization to make it work for their organization

• The application interferes with other company software systems

• The software needs to be integrated with other, existing HRIS applications to make it really useful

• The vendor did not provide adequate security or data backup services and critical employee data is compromised

It may be easier to ask forgiveness than permission. But no HR executive really wants to have to go, hat in hand, to IT for help solving a problem with an SaaS application that IT didn’t approve in the first place. At Emerald Software Group, we encourage HR and IT to work together. We’ve got the expertise to speak their language as well as yours – so you have someone in your corner at the negotiating table.