Intro to HR Technology
A primer for curious, action-oriented leaders
What’s in this knowledge article?
What is HR Technology?
Why invest in HR Technologies
How to Get Started with HR Technology
Resources
What is HR Technology?
Human Resources (HR) technology solutions are designed to organize, streamline, and automate various HR functions and processes. The landscape of HR software encompasses a wide range of applications and feature sets that assist HR professionals in managing and empowering their workforce. Perhaps the most commonly understood software category is the Human Resource Information System (HRIS). In addition to HRIS, there’s a plethora of HR software solutions and vendors in the space spanning all areas of the human resource discipline including people management and worker productivity tools.
The list below highlights the most predominant software application areas, which may have more or less HR analytics and integration capabilities:
There are three approaches to consider when implementing HR technology.
Point solutions focus on a singular business process. Point solutions are often procured as a stand alone tool. For example, Applicant Tracking Systems (or ATS) help you manage hiring and recruiting data (like interview schedules, candidate information, job requisitions, and their stage in the hiring process).
All-in-one platforms allow the user to manage multiple processes in a single system. Platform solutions have function-specific applications (or modules) provided from the same vendor that share a common database and consistent user interface. For example, Rippling is an HRIS platform that contains modules for payroll, recruiting, onboarding, and offboarding.
Best-in-breed solutions are considered the category leader in its specific niche. Websites like G2 and Capterra are frequently used by HR practitioners to discover market standing, customer reviews, and competitors within the HR software space. “Best-in-breed” solutions are often integrated with API connectors to build a unified HR technology stack.
When considering which particular approach to take, the best solution depends on your organization’s unique needs.
Why invest in HR technology
Centralize HR Data and Analytics. Instead of managing your workforce from numerous spreadsheets, HR software provides a centralized platform for managing employee data. Many HR software solutions offer reporting and analytics capabilities which enable users to make informed decisions about their workforce.
Process Automation for Time Saving and Increased Efficiency. Reducing manual, time-consuming, and low value tasks like data entry is a key benefit HR tech offers every company. HR tech automates data collection and business processes, eliminating or reducing manual tasks and human error. This frees HR professionals and managers to focus on more strategic, value-adding activities.
Enhanced Employee Experience through Self-service. Modern HR software often allows employees and managers to get the support they need without help from an HR professional through portals, user access levels, and/or system permissions. These self-service capabilities let employees and managers contribute to up-to-date employee records and business processes (like requesting time off, enrolling in benefits, submitting performance evaluations, etc).
Improved Accuracy and Compliance. Automation often reduces the likelihood of human error in HR processes (e.g., payroll calculations). Additionally, most HR software include features to track and manage compliance with labor laws and regulations which help the organization stay compliant and avoid legal issues.
Cost of neglect
Increased Administrative Burden. Without HR software, businesses may spend a significant amount of time on manual administrative tasks, limiting their capacity to focus on strategic initiatives.
Data Inaccuracies. Relying on manual data entry increases the risk of errors in employee records, payroll processing, and compliance management, leading to potential legal and financial implications.
Inefficient Processes. Lack of automation can result in inefficient HR processes, leading to costly delays in areas such as a recruitment, onboarding, and other critical HR functions.
Limited Access to Insights. Without analytics provided by HR software, organizations may lack the necessary insights to make data-driven decisions, hindering their overall business strategy.
How to get started with HR Technology
Generally, business critical operations are the first to be managed using HR technology, and they are usually transitioned early in the company’s development. These often include HRIS, payroll, benefits administration, time and attendance management, applicant tracking systems (ATS), and onboarding. Before embarking on the journey of buying HR software, do the necessary pre-work to ensure you choose the right solution that aligns with your organizational needs, business goals, and budget. Here’s a few recommendations to get you heading in the right direction:
Define Needs: Evaluate your current HR processes to understand your HR workflows and pain points. Next, define the ideal future state after the HR software is implemented and how you’ll measure the tools’ effectiveness and return on investment (for example, generating a report on time-to-hire each month). Identify the specific features and functionalities the software must have to meet your current and future needs.
Define Budget and Resources: Determine the financial resources available for the HR software, considering both one-time implementation costs, subscription fees, and cost of maintenance. Identify the internal resources, including personnel and time, available for the selection, implementation, and post-implementation maintenance of the HR software solution.
Market Research and Vendor Evaluation: Explore the HR software solutions on the market, considering both established vendors as well as emerging technologies. Create an initial list of potential options and refine those options by eliminating those which poorly fit your defined requirements and budget constraints. If you need to narrow the resulting shortlist further, use other criteria to evaluate the remaining possibilities (see step 4 below for sample criteria).
Request for proposals (RFPs) and Demos: Develop an RFP to gather information from prospective vendors using the list of criteria below. Request and participate in product demonstrations to see the HR technology in action and assess its suitability. It’s important to include a representative group of key stakeholders to the vendor demos to incorporate a variety of viewpoints in your decision making as well as begin creating “champions” for the project.
• User interface: Evaluate the technology's user interface for simplicity, intuitiveness, and ease of use for various users across the organization.
• Employee experience: Consider features such as self-service portals and mobile accessibility to enhance the overall user experience.
• Regulatory compliance: Ensure the technology complies with relevant labor laws, data protection regulations (such as GDPR), and industry standards.
• Data security: Assess the technology's security features, data encryption, and privacy measures to protect sensitive employee information.
• Vendor Support: Evaluate the vendor's customer support services, training options, and ongoing assistance provided post-implementation.
After selecting a preferred vendor but prior to purchase, perform final checks to prevent buyer’s remorse.
• Perform an online vendor background check. Research the reputation and track record of your vendors, considering customer reviews and testimonials.
• Speak to other customers. Ask your vendor to schedule conversations with a few current clients whose industry, use case, and challenges are similar to yours. These client interactions can reveal additional pros and cons of the technology and vendor as well as lessons they learned during their implementation.
• Request a pilot or trial period. A trial period lets you test the technology in a real-world environment with a limited user group to ensure the technology, vendor, and vendor’s support is sufficient for your needs.
The selection, implementation, and adoption of HR technology can be complex and require a heavy lift for your team. If any step in the journey isn’t executed well, the ramifications can be a costly mistake for the organization and may cause a loss in confidence among employees.
We can help! Whether you’re seeking help selecting the right tool for your needs, implementing a new HR software, or looking to realize your current solutions full ROI potential, we can help guide you through each step of your journey. Our consulting services include:
• End-to-end software deployment
• System optimization services
• Proven implementation methodology
• Integration strategy consulting
• Change management and adoption support
Contact us at support@alotten.com.
